SPEECH BY MR ONG YE KUNG, MINISTER FOR HEALTH AT THE DEBATE ON THE MOTION OF THANKS FOR THE PRESIDENTIAL ADDRESS, 20 APR 2023
20 April 2023
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Super-aged Country, Superb Singapore
Mr Speaker Sir
I rise in support of the motion.
2. Every generation needs to confront their unique challenges. For this generation, it has to grapple with climate change, geopolitical tensions and uncertainties the Prime Minister talked about yesterday, rapid technological advancements that can disrupt jobs and industries.
3. Domestically, the biggest social transformation for this generation will be ageing, which is the topic of my speech today.
From Aged to Super Aged
4. Ageing is unlike other elements of health - it is a human condition which we can neither prevent nor cure.
5. The United Nations defines a country as ‘ageing’ if the share of its population aged 65 and above crosses 7%. It is considered ‘aged’ if the share exceeds 14%. Once the share reaches 21%, it is ‘super aged’.
6. France took 115 years to transit from ‘ageing’ to ‘aged’ in 1980; Sweden took 85 years and became ‘aged’ in 1975; US took 69 years to become ‘aged’ in 2013.
7. Singapore took only 19 years and became ‘aged’ in 2017. The gap between ‘aged’ and ‘super aged’ is estimated at only 9 years, which means we will attain ‘super aged’ status in 2026.
8. Today, we are one of the fastest ageing countries in the world. We are not alone. Many countries, such as Japan, South Korea, Germany and UK are already where we will be in 2030.
9. The impact of being a super aged society is profound. Let me cite some of them.
10. First, it causes population dispersion as young people gravitate to cities to seek better jobs and opportunities, leaving rural areas old and depopulated.
11. This is happening in Japan. It is projected that by 2040, close to 900 municipalities, nearly half of Japan’s total, could disappear. To counter this demographic polarisation, Japan is taking some aggressive measures, including giving cash incentives to encourage young people to move to rural areas and introducing town mergers.
12. Second, when people get older, the way they consume, save, learn and work changes, and this has significant economic consequences.
13. One immediate concern is a shrinking workforce. China has confronted this issue for some years already, but it came into further prominence when China reported a fall in their population by 850,000 in 2022 –the first time China’s population shrank in the last 60 years.
14. Notwithstanding, with a large population, China is in no danger of running out of workers. It still has 8 million or more graduates every year. But the demographic shift has probably prompted China to rethink its economic development path, away from growth in labour intensive, export-driven industries, to higher quality, higher productivity activities.
15. Third, ageing has cast a big question mark over the sustainability of social welfare systems. Many pension systems around the world are becoming no longer viable. Because there are more and more older people drawing from the pension pool, and fewer and fewer younger people contributing into it.
16. France has projected a pension system deficit of ten billion euros a year. In response, the country has enacted new laws only recently to raise its official retirement age, and hence also pension age, from 62 to 64. It led to massive public protests.
17. Finally, ageing is driving the ballooning of healthcare spending, especially in OECD countries.
18. The UK National Health Service is facing a crushing patient workload. It is described as facing the ‘scissors of doom’. One blade represents patient load and disease prevalence and is going up; another blade represents budget and resources and is going down.
19. In Singapore, we have been thinking about the problem of ageing for a long time. We first started thinking about changes to the retirement age and CPF system with the Howe Yoon Chong Committee 40 years ago.
20. The Government set up the Committee on Ageing Issues almost twenty years ago and formalised it into the Ministerial Committee on Ageing in 2007.
21. So far, the Ministerial Committee has coordinated and launched two comprehensive action plans.
22. Because of this strong foundation, we are in a position to cushion the impact of ageing, and perhaps even reap dividends from it. Sir, today, I will speak on how we are preparing for an ageing society.
23. If we continue pressing on along this journey we started, we will have a bright, dynamic, vibrant and happy future. While Singapore will inexorably become a super-aged country, it can also remain a superb country.
24. My speech will cover five areas of impact. Together, they are the enablers for Singaporeans to live a meaningful and happy life, whatever their age.
Aged-Friendly Living Environment
25. First, in the area of urban development, we fortunately do not face the challenge of population dispersion like Japan. We do not have many rural areas.
26. We also have a significant advantage in that 80% of our population live in public housing, where HDB can play an active central planning and development role in ensuring inclusive communities.
27. A few years ago, SPS Eric Chua hosted me for a constituency visit to Queenstown. It is one of our oldest towns, with more than 20% of its residents aged 65 and older. Queenstown at that time was almost a super aged town, just 1 percentage point short.
28. Queenstown is like a time machine that gives us a glimpse of what the future would look like in every town in Singapore. By 2030, most towns in Singapore will be like Queenstown, in terms of residents’ age profile. Last week, I made another visit to Queenstown.
29. I can see that the place is transforming. It is now a Health District, an initiative that I launched with Minister for National Development, Mr Desmond Lee some time ago. As a Health District, many agencies came together to implement various initiatives to improve the health and wellbeing of Queenstown residents.
30. This includes integrated planning, evidence-based design of the living space, and many community initiatives, including physical activities, befriending programmes, and healthcare services, to support seniors.
31. What left the deepest impression on me was HDB’s effort in planning ahead. To ensure inter-generational mixing, HDB is redeveloping old areas, launching new BTO projects to inject a younger population into an old town.
32. A BTO project (SkyResidence@Dawson) now occupies what used to be the former Queenstown town centre. Stallholders from the former Commonwealth Drive Food Centre have moved into a new two-storey Margaret Drive hawker centre located in this development.
33. Another BTO project (QueenswayCanopy) integrates a block of Community Care Apartments for seniors and is strategically located beside the soon-to-be redeveloped Alexandra Hospital.
34. As we redevelop and rejuvenate older towns, we continue to encourage inter-generational mixing in younger towns, such as in my constituency, Sembawang Central.
35. HDB has incorporated a range of flat types, including studio and two-room flexi apartments, into the new BTO developments, catering to singles and seniors. As a result, we have a more inclusive town.
36. The Proximity Housing Grant, priority schemes for parents and children to live with or near each other, and larger 3-Gen flats, further encourage inter-generational mixing in all our housing estates.
37. These are changes at the town level. At the neighbourhood level, the physical environment is becoming more friendly and liveable to all ages, all over Singapore.
38. Wherever possible, active ageing centres, 3-generational playgrounds, and childcare centres are located side by side. Such facilities are a mainstay in HDB estates. .
39. There are visibly more congregation and rest points, exercise parks, and lifts at pedestrian overhead bridges to allow barrier-free access, and roads redesigned to slow down traffic through implementation of more Green Man+ and Silver Zones. When I was growing up in living in an HDB estate, I could see the traffic circles disappear, and replaced by traffic junctions because they are more efficient in carrying heavier traffic. Now, at this age I am seeing the junctions being replaced by circles again to slow down traffic to cater to a more senior population.
40. At the flat level, HDB has selected more than 300,000 flats built up to 1986, for the Home Improvement Programme. It has been a massive effort and HDB is now moving on to select the newer flats built in the following ten years.
41. HDB also announced earlier this month that the EASE programme will be expanded to include more features, such as customised ramps and wheelchair lifters.
42. You can see our living environment is bending its form to suit today’s society’s shape. All these are deliberate efforts to help us prepare for an older society.
A Vibrant and High Productivity Economy
43. Second, we need to adapt our economy to an ageing population.
44. The most imminent impact is on the labour force. The growth rate of our resident labour force has already slowed down. Between 2002 and 2012, it grew by 30%, but in the next decade, it only grew by 15%.
45. But the fact is that we still managed to continue to grow the workforce, despite the onset of ageing in the past two decades. This is due to a few reasons.
46. One, more Singaporeans are able to stay economically active for longer. The labour force participation rate for resident seniors aged 65 and above has almost tripled over the past two decades to about 32% now. We should continue to support the aspirations of older workers to continue contributing.
47. We have also been gradually raising the retirement and reemployment ages, from 60 and 65 in the past, to now 63 and 68. MOM aims to raise them to 65 and 70 by 2030.
48. It is worth noting that raising our retirement and re-employment ages does not affect the retirement savings that people have built up in their CPF accounts, unlike in France and many other developed Western countries.
49. Hence, the main impact of raising these ages is that workers are protected from being dismissed due to their age by their employers. Workers can choose to retire early should they want to. Hence raising this retirement age in Singapore is an unmitigated good to workers.
50. Employers must certainly do their part, for instance, through job redesign and reskilling, and learn to benefit from tapping the silver workforce.
51. Two, and equally important, is female participation in the labour force. With universal education and greater opportunities, labour force participation rate for women increased from about 51% to 63% over the last 20 years.
52. This House debated the White Paper on Women’s Development last year. Our work to ensure equal opportunities between men and women must continue, so that our wives and daughters can fulfil their full potential.
53. The Workforce Singapore has launched the herCareer initiative to support women to return to work. By 2024, we will give this a further push by introducing the Tripartite Guidelines on Flexible Work Arrangements.
54. Three, we complemented our local workforce with foreign workforce. The quality of the Singapore workforce is world class, but there are simply not enough Singaporeans.
55. So in many labour intensive industries, we will continue to need foreign manpower. Some of these, like construction, are sectors which locals are less likely to join.
56. Others, like healthcare, need more manpower to take care of more seniors. We will need more foreign manpower to complement the local core, which will remain the majority.
57. For Employment Passes, the Ministry of Manpower (MOM) will continue to calibrate its policies, to bolster our local talent pool with an international pool. The COMPASS evaluation system is more sophisticated, sensitive to both economic needs and the social impact of foreign manpower.
58. Four, our economy will continue to upgrade and evolve, to rely more on brain than brawn, to enable machines, computers and AI to augment the ability of the human worker, and indeed, drive growth through productivity improvements.
59. That is why we are driving research and development through the National Research Foundation, implementing Industry Transformation Maps, and growing high technology and high value sectors, such as biomedical, financial services, and information technology.
60. Governments around the world have two common manpower worries. We are concerned that technology will replace human workers and if that happens on a large scale, there will be too many workers and too few jobs.
61. We are also concerned about the imminent shortage of manpower due to an ageing population, and there will be too few workers and too many jobs unfilled.
62. Instead of losing sleep over contradictory worries, one perhaps may be the solution of the other. The confluence of both major trends, AI and technology and ageing, can be an opportunity to elevate our economy.
63. Education, training and a personal responsibility to evolve our attitude towards our career with age, will be key to unlocking this potential and possibility.
64. Sir, Finland has a per capita GDP of over US$53,000 – lower than Singapore, but high. It is already a super aged society, as more than 20% of its population is 65 and above.
65. Yet pre-COVID-19, it had been growing at around 2% to 4% a year, had produced several world class companies, and had a vibrant start up sector.
66. Singapore will become older, but wecan remain economically dynamic and vibrant, as long as we continue to remake our economy and prepare our people for it.
Assurance in Retirement
67. The third major aspect of preparing for a super aged society is retirement adequacy.
68. I mentioned the pension crisis earlier. Many pension systems were designed when life expectancy was much shorter, between 50 to 70 years old. Now, with people getting older and fertility rate falling, pension systems have become unsustainable.
69. Some governments have had to borrow to plug the funding gap. The accumulated national debt is then passed to the next generation to shoulder.
70. In Singapore, we are fortunate to have the CPF system. For many Western developed countries, the starting point is ‘defined benefits’. This means there is a national pension pot. Everyone pays into the same big pot while working, and after retirement every retiree dips into the pot to draw their defined pension benefits.
71. The starting point of a CPF system is ‘defined contribution’, where workers save up in their personal accounts, employers and the Government contribute into the accounts too, and workers draw down from their own personal account when they retire, until the funds run out.
72. With the CPF system, we avoided the major problems faced by pension systems around the world.
73. The CPF system is not without its challenges. One challenge is that life expectancy differs from person to person. People who live longer may see their CPF savings run out before they pass on.
74. Hence, in 2009, we introduced the CPF LIFE scheme. Singaporeans turning 65 in 2023 who meet a stipulated level of savings in their CPF accounts are automatically enrolled in CPF LIFE. When they retire, CPF LIFE uses risk pooling to provide a steady stream of monthly pay-outs for as long as they live.
75. Another challenge is that some segments of society do not save enough in their CPF accounts.
76. Hence, in 2007, we introduced Workfare, to top up salaries of lower-income workers so they can save more for retirement. In 2016, we implemented the Silver Support Scheme, which provides cash support for seniors who have accumulated less retirement savings in their working years. The scheme was enhanced two years ago.
77. MOM will continue to look at ways and means to improve retirement adequacy of Singaporeans.
Creating Health in Homes and Communities
78. The fourth area is to reform the healthcare system what I feel is probably the most important.
79. Like pension systems, most health systems in the world are designed when life expectancy was much lower. These systems focused on hospital care, which is the most costly part of the whole healthcare ecosystem.
80. So long as the population is young, the system works fine. .
81. But as life expectancy rose, so did the disease burden, the old design starts to break down. It’s like you have been training very hard for a sprint, and you realise your race is a marathon..
82. The situation is like an overflowing kitchen sink. We can mop and soak up the water on the floor, but the work is endless and the effort increasingly trying. At some point, we need to figure out how to turn down the tap.
83. In healthcare, this means slowing down the onset of severe diseases and making people healthier. If this cannot be done, the sheer disease burden driven by ageing will overload the healthcare system. Worse, it can cripple the finances of governments.
84. Hence, building on the foundation established over many years, we develop Healthier SG, our preventive care strategy which will be launched in July this year.
85. Healthier SG delivers preventive care by building up primary care – family physicians in community and polyclinics – as it becomes the foundational layer of healthcare.
86. But at this level, family physicians in primary care cannot work alone. For the minority of more serious cases, they need to escalate the care upwards, to secondary and tertiary care, in our hospitals.
87. For the great majority of less serious cases or even healthy residents, they need to devolve the care downwards to community and family care.
88. The communities we live in, the families we hold dear to, are places that create and sustain health. Studies show that 60% of health is determined by social factors, within communities and families.
89. It is about having a good family environment, hygienic living conditions, nutritious food, quality education for children, good employment opportunities, and public amenities like parks, libraries and sports facilities.
90. And where health interventions are needed, they are more social than medical, and in fact often verge on common sense – sleep and eat well, rewarding relationships, exercise, don’t smoke, undergo periodic health screening and vaccinations.
91. However, it is the common-sensical easy things that always get put off because there are no immediate consequence and therefore, they fall prey to inertia. Community support can help us overcome the inertia.
92. In particular, with community support, there are great opportunities for seniors to age healthily in communities. This is the next area where big changes need to take place.
93. Hence, beyond Healthier SG, the next area of priority for MOH, is to build up community care, to get us all to do what is right for our health, and to support ageing in communities and I’m glad that quite a number of Members have spoken about this.
94. It will be a continuation of Healthier SG, and a national programme as ambitious and extensive as Healthier SG.
95. Forward Singapore has been described as a refresh of our social compact. A social compact is usually understood as an unwritten contract between the individual and the State – the responsibility of the individual to contribute to the larger good, and the obligation of the State to provide assurances and opportunities to its citizens.
96. So under Healthier SG, how does this concept apply? The Government will provide the support and structure for individuals to take care of their own health. But beyond the relationship between individual and state, the community is at the core of the healthcare social compact.
Good Governance
97. Finally, the fifth area, there is also the significant factor of good governance.
98. Preparing for ageing, be it in the areas of urban planning, economic development, retirement adequacy or healthcare reforms, requires anticipatory policy making, which is a hallmark of the Singapore government.
99. We have made preparations for an aged society in these areas well ahead of time. We have had more than a decade of head start before the problem caught up with us.
100. Good governance also involves responsible stewardship. I described how the pension systems in the western developed countries are contributing to significant national debts, which burden future generations.
101. So, inherent in the pension crisis is the government’s inability to look after both the current and future generations of their people.
102. We consciously avoided those problems, and in fact have built up a national nest egg in our reserves. We are drawing income from it and want our future generations to continue to benefit from it.
103. Sir, since we are on the topic of governance, let me respond to the points made by Mr Leong Mun Wai and Mr Leon Perera on Tuesday.
104. Mr Leong Mun Wai alleged that the Progress Singapore Party’s (PSP) concerns and questions were often dismissed by the PAP Government, and there were occasions where the PSP was painted as ‘xenophobic, nativist and racist’.
105. The Government has always acknowledged the concerns raised by various members of the House, including by the PSP members.
106. This includes Singaporeans’ anxieties about jobs and competition in a globalised and fast-changing economy. On affordability and accessibility of HDB flats, etc, we have always acknowledged those problems and it is raised by Members of the House regardless of your party. And we are working hard to adjust policies, and make deliberate efforts to address these issues.
107. But I hope Mr Leong will also acknowledge the serious concern we have in the way he raises and debates issues. I was personally involved in a couple of these issues.
108. This House would recall that we had a debate on CECA – our FTA with India – in July 2021. Running up to the debate , there was much demonising of CECA, that it allowed unfettered entry of Indian nationals into Singapore. The discourse took on a worrying racial undertone.
109. As a former FTA negotiator, I asked to deliver a Ministerial Statement in this House.
110. I acknowledged the concern amongst Singaporeans on jobs and livelihoods, explained to the House how FTA works, in particular the Chapter on the Movement of Natural Persons, and how CECA preserves our right to immigration policies and setting work pass conditions for foreign nationals who want to work in Singapore. I also had a fairly long exchange with Mr Leong.
111. But when Mr Leong had filed a motion on foreign talent policy in September 2021, he continue to refer to CECA as a cause for the widespread anxiety among Singaporeans on jobs and livelihoods and did little to reduce the raw emotions and misimpressions on CECA that had been stoked.
112. It was as if my Ministerial Statement and explanation in July 2021 did not .take place.
113. I recall during that Motion debate, he eventually conceded that some people would think that his statements on CECA had racial undertones, against the Indian community.
114. In January 2022, Mr Leong made an allegation that teachers in MOE were treating vaccinated and non-vaccinated students differently. As Multi-Ministry Taskforce (MTF) chair I got very worried that vaccination-differentiated safe management measures got inadvertently imposed on young children.
115. Because this was a serious allegation, Minister Chan Chun Sing stood up to ask for details. Mr Leong then clarified that his information source was a Telegram chat, where there were no details.
116. All of us, including Mr Leong and the PSP, know that race issues can be played up, especially in multiracial Singapore.
117. We can debate, we can spar, but we should not pit one group against another, over and over again, always looking to tear at the seams of our society. If we keep doing that, it would sow disunity and divide our society. In multiracial, diverse Singapore, our harmony is hard earned. Let’s not take it for granted, and in fact let us be very careful to preserve it.
118. Mr Leon Perera had asserted that the Government tries to push a single “dominant narrative”, without regard to the alternatives raised by the Workers’ Party (WP).
119. This cannot be true. If not, we would not be having such extensive debates on so many issues in this House and hearing each other out.
120. Further, every political party will have its own dominant narrative based on its manifesto and values. PAP has it. WP has it. It is part and parcel of political contestation.
121. Many MPs, including WP MPs, have raised many ideas in this House. We welcome them, and where appropriate, we take those ideas in when formulating or reviewing our policies. And where we have a different view, we explain why.
122. I would say many of the ideas raised in the House, including by the WP, are not fundamentally at odds with existing policies. They build upon the policies that we already have and make them better, cover more areas.
123. Sometimes they are shades of the same policy, and we need not exaggerate their differences.
124. In the case of preventive healthcare or carbon tax, WP’s proposals are actually similar to the Government’s policies.
125. Very often, the WP as opposition wants more of what is already being done. Whatever the Government proposes, ask for more. So here is one difference between our two parties– I do not think it is a major one - and is again part and parcel of political contestation.
126. But a fundamental difference arises when it comes to the WP’s ideas for the budget. Why is that so?
127. Because to do more, one has to spend more, and one has to say where the money is to come from. However, the WP never supported the GST system. An alternate budget without the GST simply cannot work and is not a viable alternative.
128. The sums just do not add up. You cannot give up a major source of revenue and yet want to spend more in so many areas.
129. I may have misunderstood WP’s position. Perhaps it has changed its long-held position and now accepts that GST is needed, but merely objects to the increase from 7% to 9%.
130. To make up for the loss of two percentage point of GST revenue, the WP has proposed, amongst other things, changes to the Net Investment Returns Contribution (NIRC) formula. Instead of drawing half of NIRC for government spending, WP proposes to draw a higher percentage at 60%.
131. The PAP government will not agree to it and this is a fundamental difference. It has to do with our beliefs and values.
132. We debated this issue in the Budget Debate last year, and DPM Wong has explained the government’s position. Let me try to explain again in my own words.
133. Our view is that the reserves belong to all generations of Singaporeans, current and future, even though they are not born, cannot vote and their voices have yet to be heard. As responsible stewards, we will nevertheless safeguard their welfare and interests.
134. To achieve this, the current formula is deliberately designed to divide the NIRC equally – half for current generation to spend, and the other half adds to the savings for the future. The half-half apportionment formula is simple, fair, and wise.
135. It is very tempting, even seductive, to say let’s shift half-half to 60:40. But we debated and enshrined the fiscal rules in our Constitution not that long ago. We should not at the first sign of need, push for changes in the rules, just to take the easy way out.
136. We should hold on to the equal apportionment principle for as long as possible. This is good stewardship and it is the PAP’s position and that is why there is a fundamental difference here.
Closing
137. Sir, I mentioned earlier that ageing is the unique challenge of this generation.
138. But previous generations had their unique challenges too, be it the plague, the industrial revolution, the World Wars, unravelling of the global monetary system, threat of nuclear holocaust, Cold War.
139. Specific to Singapore, this and earlier generations had to weather the threat of communism, racial riots, becoming an independent nation, severe recessions, COVID-19 – but we overcame them all.
140. It is the overcoming, and not the problems and challenges, that define a generation.
141. I had earlier said that ageing is a part of the human condition. As someone who is one Zodiac cycle away from becoming an “aged”, and as a health minister, I consider ageing a stage of life to be greeted like an old friend, and certainly not a pathology.
142. Sir, I spoke about Finland’s positive economic performance earlier, even though it is a super aged society. Another interesting fact about Finland is that the World Happiness Report ranked the Finns as the happiest people in the world, six years in a row.
143. A recent New York Times article, which caught my eye, reported that the reality of the state of happiness in Finland is more complex. Finnish people are happy about the strong social safety net of the country, but they also worry a lot about their security and domestic political situation.
144. The report went on to say that “the happiest people in the world aren’t that happy…more like content.” It went on to say that there is a way of life in Finland called ‘sisu’, which roughly translates to “grim determination in the face of hardship”.
145. You can understand how ‘sisu’ came about, given Finland’s harsh climate living condition and sense of insecurity due to a long common border with a big and historically unfriendly neighbour in Russia.
146. When you have such a long yet inaccurate English description struggling to translate a specific concept, you know this is a unique characteristic embedded in the DNA of a particular people – and in this case the Finns. .So for Singapore, what is it? They have ‘sisu’, I do not think we want to say kiasu.
147. For Singapore, a small island along the equator, in the middle of Southeast Asia with a diverse population at the intersection of the world, I think we have a different trait, a quiet unity, optimism and stout heartedness that we can together overcome all challenges.
148. Sir, it is ironic that the challenge of ageing came out of good things – people living longer due to medical advances and better quality of life, fertility rate coming down as aspirations changed and women get more educated.
149. But perhaps the state of being a super aged society can ultimately be an overall a good thing too – where people live long fruitful lives; where there is health longevity; where there is warmth and care in every community and we look out for each another.
150. And perhaps one day, after we tackle the challenges of a super aged society with our Singapore spirit, we can reach the stage where society treats age as nothing but a number, and 65 need not be the artificial line that divides the two sides of the dependency ratio. One may be advanced in age, but still feel young, or even if the body feels old, the heart feels young.
151. Thank you, Sir.
151. Thank you, Sir.