Hard Living in Singapore – Speech by Jamus Lim on Poverty

Imagine for a moment, if you will, being a teenager again. The awkward parties, the search for self, the facial breakouts. But one of the feelings that many of us will find inextricably linked to our adolescent years is one of exclusion. Now imagine the same feeling, only that you are now supposed to be a fully functioning, fully-participating adult in society.

Mr Speaker, Singaporean incomes present themselves as somewhat of an enigma.

By some measures, we are among the richest countries in the world. Measured in terms of a common currency, Singapore comes in at 5th in 2022, ahead of Qatar and the United States, and just shy of Switzerland. When adjusted for actual purchasing power, we climb even higher: to 3rd, just behind Ireland and Luxembourg, two European countries often used as tax shelters.

But amid this wealth, we also see sharply dissonant scenes: of the elderly picking up cardboard or selling tissue packs or clearing plates at hawker centers, of an underclass of workers who live in dingy, overcrowded rental flats and rely on food handouts, of people who quip that in Singapore you can be poor or you can be sick or you can die, but you cannot stop working.

In her address last week, Madam Halimah urged us to improve our social compact and strengthen our social safety net, emphasizing how “the fruits of progress must be shared fairly.”

I support the President’s sentiment, and the motion, but in this speech, I will speak more about the apparent economic success declared by the headline numbers, versus the economic precarity felt by a large group of Singaporeans. I will go on to discuss hard living in Singapore, especially after the pandemic, before concluding with proposals that can help us improve the circumstances of those struggling the most.

The high and low cost of living in Singapore

Living in Singapore isn’t cheap. Look around. The market price of a 4-room HDB flat—all 970 square feet of it—ranges from $460,000 (in Jurong East) to a whopping $860,000 (in Queenstown). Sengkang—the district I represent—recently saw flat change hands for close to a million dollars, and islandwide, close to a dozen four-room flats sold for more than one million mark in the first quarter, and observers expect this trend to persist.

The cost of a new Japanese sedan—like the Honda Civic that I drive—is $180,000, around 5 times the price of what it goes for in the other advanced economies. Put another way, buying a car would cost close to three years’ salary of a typical middle-income individual here, compared to around 14 months in the United States.

Our decades-old aspiration toward Swiss standards of living have, alas, also brought with it Swiss-style prices. Reports routinely place Singapore (tied with New York) as the most expensive city to live in the world. While this government has argued that such metrics do not reflect the typical experience of a Singaporean household—who consume different things and have access to (taxpayer-funded) grants and subsidies for big-ticket items, like purchasing an HDB flat—the sting is that many things the rest of the world deems affordable is, for us, not.

That said, by some measures, Singapore is eminently affordable, at least when compared to other advanced economies. Delicious hawker meals—which we rightly celebrate as a part of our intangible heritage—can be had for a few dollars (plus a dollar more if you happen to live in Sengkang). Our public transportation system is excellent, and many of us commute on a day-to-day basis by paying relatively affordable—albeit rising—fares. Most of us are able to send our kids to school without the need to resort to expensive private schooling that would break the bank.

Whence the discrepancy? It stems from the fact that for those among us that do not own or have access to capital, life is exceedingly hard. It is one of working long hours but barely getting by, of living out each day with little hope for the future, of seeing the enormous prosperity our country has achieved but feeling that somehow that has mostly passed you by. But for those who own assets like stocks and bonds, who run or inherited a business, or were fortunate enough to get on the housing ladder early on, it is possible to enjoy the fruits of this wealth, and rely on high asset prices to cushion the effects of high prices of goods and services.

Hard times after COVID-19

Moreover, the challenges of the poor would likely have been compounded by the pandemic. Across the globe, economically-vulnerable households have tended to fare poorly as a result of the COVID-19 shock. Detailed surveys from economies—both Western and Eastern—suggest that lower-income groups experienced greater job market losses. In Singapore, two separate studies by DBS on account balances revealed that close to half of lower-income groups suffered significant falls in income—with around half within that group experiencing income drops of more than 50 percent—and had less than a month of emergency funds available.

This may seem particularly unfair, since the less well-off were often also our essential workers, and had to continue on the front lines, even as the rest of us sheltered at home.

Unfortunately, the poor did not find much relief after the pandemic. Inflation hit hard, reaching peaks of 7.5 percent in August and September last year. While this has come down, inflation—in excess of 6 percent—continues to eat away at incomes. A more recent survey by DBS found that wage increases have failed to keep up with inflation, and for the lowest income group, expenses have grown close to five-and-a-half times faster than their salaries. Even by the government’s own statistics, household real wages decreased in 2020 and 2021, and the small increase last year does not fully make up for the losses.

In contrast, those of us who have been lucky enough to have sufficient savings to invest have (in some cases) been able to tap on higher interest rates offered by the market, to shore up finances. But such discrepancies only serve to further exacerbate the gap between the wealthy and the rest.

Two schools of thought on poverty

Researchers who have devoted their lives to studying poverty tend to believe that its causes may be broadly classified into two groups. The first argues that low incomes constrain the ability of the poor to save, eat well, and pursue educational opportunities. Since poverty causes poverty, the solution is to offer one-off transfers that help the poor extricate themselves from their plight. A second group believes that are poor are limited by their God-given abilities, talents, or motivation; they will always be among us, and the solution is to provide small but repeated income support.

I believe that there is merit to both these perspectives on poverty. Inasmuch as we want to offer opportunities for those among us to escape a poverty trap—the basis of most of the government’s antipoverty policies—there are those endowed with less potential, stricken by physical or mental disability, or face persistent discrimination, who require the support of society at large. And in a rich, advanced economy, I believe that doing so is the correct and compassionate thing to do.

Are there poor in Singapore?

Regardless of which school of thought one subscribes to, the fact remains that, if we are to help the poor, we must know who they are. But in Singapore, we have yet to establish an official poverty line. This is both puzzling and exasperating. We take pride in ourselves as people that are quantitatively sophisticated and highly efficient; we make and meet KPIs. Targeting the poor is impossible (or at least, imperfect) without an official, transparent benchmark.

We have, instead, a confusing mishmash of thresholds that have been applied to different agencies at different times. We sometimes see reports for the lowest quartile or quintile being treated as the poor, or simply halving median household incomes. The HDB income threshold for rental is $1,500, while the ComCare threshold is closer to $1,900. The Department of Statistics instead pegs the Average Household Expenditure on Basic Needs at $1,250, albeit this low figure was from two surveys ago, and the calculation does not seem to have been updated.

Other unofficial lines, based on ensuring social inclusion or allowing for relative, not just absolute, poverty would suggest higher amounts: these range from $2,500, to as much as $6,400. One may quibble with these numbers—and this government has certainly done so—by arguing that the high-end estimates overstate what are needs, versus wants, in the household.

A poverty line is defined as the lowest income level that would be deemed adequate in a particular country. This leaves a tremendous amount of latitude in terms of what “adequate”; what may be regarded as an absolute minimum necessary to purchase goods and services for basic needs in a poor country may be shockingly low when set against expectations of needs in a rich country. Indeed, there is clear evidence that as countries get richer, the value of what is conventionally regarded as a basic need rises.

And the fact is, we are no longer a developing country. The sort of things we need to be a participant in Singaporean society has changed. Smartphones may seem like an unnecessary perk to some, but without one, many basic government services become incredibly difficult to access. A holiday may strike others as a luxury, but for large families cooped up in tiny apartments, a brief getaway to Malaysia offers an important respite that can ensure the mental health of parents. And money spent on angpows and gifts and celebrations aren’t frivolous spending; they represent rites of passage and acts of reciprocity that speak to a moral economy and societal norm, which cannot be reduced to dollars and cents.

It is, in my view, an insult to suggest to a family that the supplemental tuition that their struggling kids need to stay afloat in our overcrowded classrooms isn’t sufficiently “basic.” Or that spending on deodorant in our hot and humid climate, particularly before an interview or big date, is truly “discretionary.”

Part of the problem is a disconnect between what the government has claimed to be basic, versus what Singaporeans themselves perceive as necessary for human flourishing. But if we can all agree that a good life includes opportunities to education and decent healthcare, employment with work-life balance, and a sense of inclusion when one participates in social, cultural, and religious activities, then why do we not extend these to the most economically vulnerable in our midst? Life is not just about making it day to day, but about thriving. All humans—poor or not—have aspirations.

It is time for an official poverty line. This line should be established based on components that go beyond just crude “basic” needs of housing, food, and clothing. Set up a committee, with representatives from not just the MSF  but also leaders from civil society and experts from academia, to figure out what this should be. Then peg all thresholds for government assistance—especially ComCare—to this line, or higher (but never lower). The Local Qualifying Salary—effectively our minimum wage for Singaporeans—should likewise be tied to this line.

Making ComCare care more

Even after we have established a new threshold for ComCare, we need to recognize that the system be refined. At this year’s Committee of Supply debate, I suggested that the ComCare approval process can be intrusive, onerous, and demeaning. While I agree with the principle of being responsible with public monies, we should not become overzealous in the opposite direction.

It is tempting to design a public welfare system that attempts to sieve out the those we deem “unworthy” of support: so-called welfare kings or queens. Such individuals exist—we may even have some regulars in our meet-the-people sessions—but they are few and far between. Most of my residents possess a lot of self-respect, and feel uncomfortable seeking help from the state, even when they are going through a tough situation not of their own making. A system that is stingy about financial assistance to the 8 or 9 folks that just want a little bit of support in a particularly trying time—just to deny the 1 or 2 abusers—strikes me as excessive, especially since all that effort translates into only a modest payout.

Furthermore, support is often granted for an unbearably short time; 3 to 6 months in the first instance. With precious few exceptions, how can someone’s lot alter dramatically in 3 months? Even when we make reappeals to agencies such as ICA, we are often told that we should wait for 6 months before trying again, since life circumstances are unlikely to change much in the interim. And even if they did, providing some additional months’ support would help them partially fill up the hole that they find themselves in.

As my honorable friend Leon Perera has argued in this House, poverty imposes a nontrivial “bandwidth tax”: the cognitive burden of poverty, in and of itself. Being in dire financial straits not only imposes mental stress as one searches for job opportunities; it can affect our handling of an all-important job interview, or our performance in our jobs during the probation period. It steals mental resources that are better spent on improving our situation, or providing care for our dependents. It even reduces the pleasure we receive from the little that we are able to consume.

Think back on the last time was when you had a tight budget before your next paycheck came in, and how you had to worry about whether you could make the rent or mortgage, pay for your meals next week, or clear bills that would keep the lights on. Play out that exercise every single day and week, and you sense how it’s like to be poor. Now layer on that the need to “prove” that you’re indeed poor every few months to an SSO officer, who has the power to snatch away the fragile lifeline that you have.

We can reduce the need for such burdensome and intrusive pre-approval scrutiny by obtaining many documents directly from the public and semi-public agencies, such as rental or utilities. We can deploy conditional cash transfers (CCTs) in exchange for desired behavior—such as supplementary educational expenses, or preventative healthcare spending—and use the fulfillment of the condition as sufficient evidence to qualify for support. We could set a default that automatically qualifies all Singaporeans in rental flats for an extended period in the Keystart Home Ownership Program, as recently suggested by a local social sector leader.

Nor should we be working to prove our worthiness

The government might argue that, beyond ComCare, there is the Workfare Income Supplement (WIS), our other key antipoverty program that is also aligned with incentives. But as I suggested before, not everyone who is poor is able to work, and even when they can, circumstances may constrain how much they can.

The WIS is based on an earned income tax credit (EITC), which in turn is a refinement of a negative income tax. Without going into technical details, it is sufficient to note that our scheme tends to be viewed more as a grudgingly-offered financial supplement conditional on one putting in sufficient work hours, rather than an antipoverty tool aimed at lending additional support to our low-income earners.

This is, in part, because the amounts offered by the WIS are paltry, the majority of which isn’t even accessible for meeting daily needs, since it goes straight to CPF. Even with the most recent revision, top-ups amount to $350 a month at best, and can be as little as half that. While any additional help is undoubtedly welcome, I’ve had many residents share that the support hardly makes a dent in high-cost Singapore. This is exacerbated by our low income thresholds—$30,000 a year—before one is disqualified (in contrast, the maximum income for the U.S. program is closer to twice that).

The $500 minimum monthly income requirement—introduced last year—may also inadvertently exclude workers who are most in need of the flexibility afforded by part-time employment. While the ostensible reason for the requirement is to exclude more well-off families from benefiting from the program, it seems like the more tried-and-tested tools—total household or spousal income, or the AV of one’s residential property—would be sufficient to rule out the nonpoor.

Indeed, while we are reassured that those who are already on ComCare will automatically receive Workfare, I am sure we are aware of poor families who, for various reasons, aren’t on ComCare (perhaps because of onerous documentary criteria, or if an estranged child happens to be a high income earner). Were these individuals to work only limited hours, perhaps due to health or age, the limited additional support Workfare promises would nevertheless not be available to them.

Workfare also seems to be blind to the differential needs of parents with children; the WIS is, to put it bluntly, independent of dependents. This is in contrast to the approach in other jurisdictions, where support is significantly higher if the household has one or more children. This approach makes absolute sense, since parents not only have more dependents to support, they also need to make arrangements for childcare were they to enter the workforce.

Finally, it is worth pointing out that there are age conditions associated with the WIS, where those who are younger receive less support than the elderly. But this is curious: Why would the youthful poor necessarily need less money than the elderly? This becomes even more off when taking into account how Silver Support is available only to those aged 65 and above.


We have been remarkably recalcitrant in our willingness to support our poor. We can do more, much more, and if we want to call ourselves a First-World nation, we surely must.