Saturday, September 28, 2013

More poor people in S'pore than figures show

Sep 25, 2013

'Working poor' among those highlighted by panel at NUS forum

By Andrea Ong

THERE are more poor people in Singapore than the numbers seen in official figures, said speakers at a National University of Singapore forum yesterday.

To get to grips with the issue, more needs to be done to understand poverty here and tailor measures to the circumstances people face in their daily lives, they said at the forum on building an inclusive society.

To highlight the urgency of addressing the poverty issue, Nominated MP Laurence Lien and labour economist Hui Weng Tat cited sobering figures that show rising income inequality and stagnating wages of the bottom 20 per cent in the past decade.

One problem, said Mr Lien, who heads the National Volunteer and Philanthropy Centre, is the absence of an official definition of the poverty line in Singapore.

The closest measure, he said, is the Statistics Department's Absolute Household Expenditure on Basic Needs. It looks at average expenditure on essential needs such as food, clothing and shelter.

The Trade and Industry Ministry pegged this figure at $1,250 for a four-person household in 2011.

About 4,830 such working households - or about 2 per cent of all households - had income below this sum. But, Mr Lien said, this measure does not explicitly include transport, education and medical costs.

It also excludes what he called expenditure on "social inclusion", in which people spend on items or experiences to feel part of a group. "According to the State, we have about 4,800 poor households and that's about it. I don't think that's acceptable."

Associate Professor Hui, of the Lee Kuan Yew School of Public Policy, highlighted the plight of the "working poor" who struggle to make ends meet, saying: "Having a job does not guarantee that a person is not poor."

A graduate earning $4,000 a month could be poor if he were the sole breadwinner with many dependants, he said.

In the European Union, for instance, the working poor refers to those with a disposable income that is below 60 per cent of the national median household income, adjusted for family members.

Mr Lien cited a local study that estimates 6 per cent to 8 per cent of working households here - or 70,000 to 90,000 households - earned below $1,500 a month and can be called the working poor.

With NUS social work professor Irene Ng, who rounded off the panel, the speakers called for more targeted measures to help the poor.

Prof Hui and Mr Lien criticised the Workfare Income Supplement (WIS), saying it "lets employers off the hook" as the top-up comes from the Government. There is thus little incentive for them to upgrade workers or raise their productivity, they said.

[This is a simplistic answer to a complex issue. Before there was WIS, workers were also not upgraded, and productivity was not raised. So maybe WIS doesn't incentivise upgrading of workers or raising of productivity, but it is NOT a problem of its creation.]

Both were in favour of minimum wage, which Prof Hui said could complement WIS by pushing up wages at the bottom while nudging employers to send workers for training.

[So you criticise it, then you want to complement (not compliment) it?]

He suggested pegging it at half the median income, which was $3,000 a month last year, excluding employers' Central Provident Fund contribution.

The need for more help for the poor also emerged in a new survey led by Associate Professor Ng.

More than 60 per cent feel the amount spent on aid to the poor is too little. While most feel government programmes make things better and jobs are available for aid recipients, only 15 per cent feel the jobs pay enough to support a family.

While the sample is not representative, most respondents - including the higher income - empathise with the poor. Seven in 10 feel individuals are not to be blamed for being poor as it is caused more by circumstances beyond their control.

[This is good. If we do not blame the victims, then we are more likely to help the victims.]

This runs counter to other societies with high income inequality, where the rich are more likely to see poverty as the individual's fault, said Prof Ng.

"So we must catch hold of this chance now, when there is empathy and we can do more."

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