National University of Singapore (NUS)—A widening of the rich-poor gap will be one of the key concerns for Singapore as it embraces globalisation, Dr Vivian Balakrishnan said.

This is because globalisation—which is inevitable in Singapore—will benefit those who possess skills while sidelining those without, the minister for community, youth and sports said Friday evening.

Terming the issue “class warfare”, he said: “One of the economic outcomes of globalisation is that if you’re smart, hardworking, creative, and connected to the high-value networks of the world, your income will be stratospheric.

“If you’re not skilled, if the skills you have are irrelevant because things can be done by a robot or someone else in another country very cheaply, there’s downward pressure on your wages.”

Indeed, income inequality may have already reared its ugly head in Singapore. A February report by the Department of Statistics found that while the household income of the average family rose 9.6% last year, the wage increase was skewed in favour of richer families.

Figures showed that income per family member in the top 10% income bracket jumped 11.1%, compared with only 3.3% for families in the lowest 10% income bracket.

Dr Balakrishnan was speaking on the topic of globalisation at the Kent Ridge Ministerial Forum organised by the NUS Students’ Political Association. The event saw a turnout of about 300 students and members of the public.

The income divide, he believes, will figure prominently on the political agenda of the government—including its tax policies—and pose a “paralysing” problem.

“No politician, except in Singapore, can win an election from raising higher taxes, and even in Singapore it’ll get harder,” he said to laughter from the audience.

“Class warfare will pose a paralysing political discourse and will probably limit the ability of politicians in the future to do the right thing, because for every policy you come up with, people will say, ‘Does this benefit me, or penalise me? Is it good for the rich, or good for the people?’”

He cited the example of the American presidential debates, where both Republican candidate John McCain and Democratic presidential hopeful Barack Obama sparred over who had the better plan to keep taxes low.

“Yet if you look at America, they need so much money to fix their social security, healthcare and education systems, and military adventures,” he noted. “The honest politicians in America need to stand up and say, ‘We’re all going to have to pay for these, and that means higher taxes’.”

Dr Balakrishnan also responded to a student’s question on Singapore ministers’ pay. He acknowledged that although the ministers are very well-paid, the pay scale is made transparent to everyone.

“Yes, we’re the highest paid ministers in the world, but we’re not the wealthiest,” he said, alluding to corruption that takes place in other countries.

“The system is totally transparent,” he said. “So if and when we really get to the point where the wages that are paid to civil servants and political office holders are completely off the scale, then that alone would lead to a revolt at the election.”

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• Minister shouldn't have politicised forum

  —Oct 20th, 2008, 1.39am

• You can't have your cake and eat it too

  —Oct 18th, 2008, 6.06am

• Everyday concerns not addressed at forum

  —Oct 18th, 2008, 3.34am

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