Thursday, March 5, 2015

14 per cent of those who start off at the bottom end up at the top: Tharman

MAR 5, 2015


SINGAPORE - More than one in 10 young Singaporeans who start off in life in the lowest 20 per cent income group, end up in the top 20 per cent of the population later in life.

Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam revealed these figures in Parliament on Thursday to highlight the state of social mobility here, saying that society is more fluid in Singapore than in other developed countries.

Wrapping up the Budget debate, he listed the ways in which the Government has been taking steps to ensure such movement, saying social mobility "has to be part of our Singapore identity".

"It's a challenge all over the world. In fact, social mobility is the defining challenge in every advanced country today," he said. "We're fortunate that Singapore has so far done relatively well. It is actually still a more fluid society than most."

In Singapore, 14 per cent of those in their mid-20s to early 30s, and who started out in families in the lowest 20 per cent income group, moved into the top 20 per cent income group themselves, said Mr Tharman.

By comparison, only 7.5 per cent of those in the lowest income quintile in the United States managed to move to the top 20 per cent, he noted.

Even in the Scandinavian countries, reputed for their comprehensive social welfare programmes, only about 10 per cent to 12 per cent of those in the lowest income quintile move to the top one-fifth.

Pointing out that social mobility will be harder to sustain as society gets more settled, Mr Tharman said that the Government has taken major steps in Singapore to keep pathways open for all.

[EXACTLY! Those in their mid-20s to early 30s were born 25 years or so ago. 1990. LKY was still PM or had just handed over to GCT. We were moving from 3rd world to first. The MRT was only a few years old. Those over 30 were born before the MRT ran. It was a younger Singapore, society was less settled, the people and the SG government were firmly opposed to Casinos. Social Mobility in a young country is EASY. 

The remarkable thing is that old countries like Scandinavia still have 10 - 12% social mobility.

He added: "We want to give the best chance for someone who starts off with a low income background or middle income background to move up, make sure it remains a fluid society."

[You do realise that the flip side of this is that SOME kids from the top quintile will have to fall into the lower quintile...]

The Government has done so through investing in education for the young, promoting home ownership, encouraging adults to build on their skills, tempering inequality through social transfers and providing support for the old, he said.

The sum of all these measures, said Mr Tharman, is a social compact that is "not just about stronger collective responsibility but seeks to encourage personal and family responsibility".

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