Opening Address by Minister Desmond Lee at the St Gallen Symposium Singapore Forum on 13 Jan

Jan 13, 2023

Mr Beat Ulrich, CEO, St. Gallen Foundation
Your Excellency, Frank Grutter, Ambassador of Switzerland to Singapore
Fellow Panellists


1        Good evening. This year’s theme - “A New Generational  Compact” reflects a crossroad that the world has now come to, amidst rapid technological changes, social and demographic shifts, and a worsening climate crisis. This brings with it challenges and opportunities but also risks.

Forward Singapore & Review of Social Compact

2        The social compact in Singapore has evolved over the decades, as our society, economy and the world around us changed. For instance, there was a very strong emphasis on individual responsibility and self-reliance in the post-independence years, as very limited resources were focused on basic universal needs such as housing, healthcare, education and job creation. The older generation will remember what self-reliance and individual responsibility meant in terms of the interface between policy and lived experiences on the ground. And so charity, religious institutions came onboard, partnered the government to provide support for groups of Singaporeans who needed additional income.

3        As our economy grew, our social compact evolved to include a greater sense of collective responsibility and participation, with more targeted support towards the lower-income and vulnerable. This reflected Government’s and society’s concerns about the widening income gap and those who may be left behind due to the rapid shifts in our local and the global labour market and economy.

4        Today, the challenges faced by countries around the world, including Singapore, are more profound and complex than ever. Switzerland and Singapore are very vastly different in terms of size and geography but there are many things that bind us together – common challenges that this Symposium can bring young people together to tackle.

5        Globally, we are in a period of greater geo-political contestation, economic bifurcation, and face the risk of a recession and slowdown with impact on jobs and livelihoods. Domestically, Singaporeans’ aspirations are becoming a lot more diverse than in the past, family sizes are shrinking, our economy is maturing, and our population is rapidly ageing.

6        So it is timely that my colleague DPM Lawrence Wong launched Forward Singapore last year. It aims to take stock, bring Singaporeans together, examine where we are as a society, as an economy, as a nation; examine our society’s values and aspirations, and to build consensus to refresh our society compact for a new generation. Today, I will share some brief thoughts about the inter-generational compact in Singapore and how it impacts the way we design and plan our city-state and use our limited land and resources. And I look forward to listening to your ideas and reflections and those of my fellow panellists later. Of course this sets the stage for us to bring ideas to St Gallen in May to engage the youth of Switzerland and of Europe.

Singapore’s Land Constraint and Stewardship as a Core Value

7        Our starting point is that we are a diverse, multi-cultural, cosmopolitan Asian society living in a small city-state. To put it into context, Singapore, with a land area of about 730 square kilometres, is less than 2% the size of Switzerland, but with about two-thirds the population.

8        Hence, we have to make difficult choices between the many needs and the unlimited wants of today, versus setting aside enough space and resources to meet the uncertain challenges of tomorrow. There is always a temptation to exhaust all our land and consume our fiscal reserves to make popular choices to meet the needs of today’s generation. But that was not the approach our pioneer leaders took. Instead, they were disciplined and far-sighted to make the difficult trade-offs and long-term plans that have set our generation up for success. They made those choices in the context of a Singapore that was just newly independent with few resources and a whole lot of problems.

9        A case in point is our Marina Bay business and financial district, with its iconic Singapore skyline. They started planning for Marina Bay as far back as the 1970s, shortly after independence. When our city planners foresaw that our city centre would need to be expanded if Singapore was to succeed as a business and financial hub. It took more than 30 years of painstaking planning, investment, and preparation, before developments in Marina Bay started taking shape in the new millennium. Some who envisioned Marina Bay knew that they might not see the fruits of their labour, but that did not affect their determination to keep improving Singapore. 

10       Another critical principle that our pioneers set out, was the protection of the State’s reserves, which enabled us to build up a rainy-day fund. We tapped on these recently to fund five Budgets to tide us through the biggest crisis of our generation. It is a principle that we must continue to uphold, especially as we head into a future fraught with challenges such as climate change and greater geopolitical uncertainty. This spirit of stewardship is a defining feature of the social compact we inherited that is core to our Singapore identity. That this city and its resources are not for us to just use and consume in our generation, but that we have a duty to steward it wisely, grow it, for the next generation.

11       Similar to how our pioneers planned for Marina Bay, we have started planning and preparing for the development of the Greater Southern Waterfront (GSW), amongst others, which we announced in 2013. It will open up a large stretch of prime land along our southern coastline for future generations to live, work, dream and play. GSW will be developed progressively and is expected to be fully realised after the 2040s. This is a major multi-decade effort. It’s not just drawing some lines on the map. We really make a deliberate effort to move, do land preparation, land reclamation – and a lot of work – to make that land available for generations that may not yet be here. We are undertaking this now to create the space we know that our future generations will need.

12       We also innovate in our housing and land use solutions. My colleagues are here from the URA. Our Long-Term Plan Review which concluded last year and engaged more than 15,000 people spawned a whole range of creative ideas. As stewards, these are not just your resources to use but to plan and use them in the best interest of the next generation. You have to be innovative. It spawned ideas such as public housing flats that will be offered with open plans to allow homeowners flexibility to configure the spaces according to their own needs as they change over time, and a “vertical zoning” concept in our industrial estates to allow a mix of different but complementary uses within a single development.

13       Another aspect of stewardship in the context of social compact is the need to make sure that we do not unnecessarily indenture future generations through debt that we incur for the needs of our own generation. Nevertheless, for development of significant infrastructures that will generate yield and benefit future generations, such as the Terminal 5 expansion of our airport, it is equitable to expect future generations to share in the costs, as much as they will the benefits. And this can be achieved, for instance, through the issuance of infrastructure bonds. However, we recognise that the context and challenges we face today are different from those of our previous generations and require different sets of resilience. Our social compact will need to evolve to be fit for our time. But we remain responsible and disciplined to acknowledge and make difficult trade-offs. 

Our Homeownership Approach

14       Our approach to homeownership is one example. Today, our city-state has one of the highest home ownership rates in the world, at close to 90%. This is higher than the United Kingdom and United States at 63% and 65% respectively, More remarkably, around 85% of low-income households own their homes. Something not commonly seen in countries around the world. But demand for housing is broad-based and will continue to grow, even if the foreign population doesn’t grow as fast, and this is driven by social trends such as family nuclearisation, more singles, ageing and active longevity, and sheer aspiration for more space.

15       Even as we try to meet the growing housing demand, as a result of all these factors, we need to be good stewards of land and resources. We maximise the potential of our limited land through greater land-use intensification and by rejuvenating older estates through redevelopment.

16       We prioritise needs – such as those buying their first home to start a family and also make sure we provide options for different demographics. At the same time, we aspire to conserve more green spaces and protect more of our built heritage, as Singapore yearns for greenery in our city and aspires to conserve biodiversity in a dense city. And to conserve these against competing needs such as healthcare, education, transport, industry and others. And we do all this without exhausting all available developable land to reserve space and optionality for future generations to dream, to grow and to develop. And we reserve optionality typically by keeping spaces available to them and also at the time that the generation comes of age, the land can be rejuvenated for them with a free hand to draw and develop to live their dream.

17       Against this backdrop of land constraints, Singapore, like other cosmopolitan cities, also need to contend with social and economic forces that, if left to their devices, can cause social stratification and division. This can manifest itself where people live. Our social compact to keep society cohesive means we must proactively act against these forces.

18       One way we do this is through the provision of more support for lower-income families, who generally have fewer housing options. We recognise having a stable living environment is important to improve inter-generational mobility. So we provide highly subsidised rental housing under the Public Rental scheme as a social safety net. To ensure that our public housing remains inclusive, such public rental flats are built alongside – or, even within the very same building as – sold HDB flats. This includes flats built in prime areas of Singapore launched under the Prime Location Public Housing (PLH) model.

19       Beyond the provision of housing, we have also implemented the Community Link Rental flats (ComLink) and Fresh Start Housing Scheme, to empower families with children living in rental housing, to help uplift their life and to marshal resources, policies and programmes for a brighter future. We make sure that poverty does not transfer down to the next generation. So it is not just the provision of housing as infrastructure with affordable rent but providing the opportunity for a trampoline. Housing with proactive social support.

Taking Care of our Seniors

20       Another aspect of our intergenerational compact is how we provide and care for our seniors. People who worked hard in the early days to make this city what it is today. With an ageing population, we will require an increase in our social expenditure, that needs to be paid for from new revenue sources. We have to refresh and calibrate our social compact carefully to be sustainable and to avoid inter-generational divides which has polarised the political landscape in some societies. 

21       For example, we provide extra support to particular generations of older Singaporeans by setting set aside funds from today’s budget and not burdening future generations. These pioneers contributed significantly to nation-building during Singapore’s early years, but did not fully benefit from our economic growth later on. These are important societal values we want to reinforce – a sense of gratitude and respect to those who came before us.

22       We are also shifting to a community-based model of care for our elderly and ageing-in-place. We are innovating with new models of public housing for seniors such as Community Care Apartments, which is a new typology for assisted living that integrates housing with care services. The government supports through innovative public housing models such as Community Care Apartments, and by fostering community networks to engage and support our seniors.  

Tackling Climate Change

23       Climate change is another key challenge of our time that has long-lasting impact on generations to come. It is our duty to future generations to get this right. Singapore is doing our part. We have set an ambitious national target to achieve net zero by 2050 and launched the Singapore Green Plan 2030, a whole-of-nation movement to pursue sustainable development. Initiatives within the Plan cuts across different sectors, from energy to transportation, and even the education sector. For the built environment, we launched the Singapore Green Building Masterplan in 2021, with several targets, including greening 80% of buildings by Gross Floor Area by 2030.

24       We are also preparing to adapt. Climate change could cause mean sea-level around Singapore to rise by up to 1 meter by 2100. With extreme high tides and storm surges, sea levels could rise to be as high as 4 to 5 meters – high enough to potentially flood one-third of Singapore. Some of our biggest investments, therefore, will be in coastal protection, such as seawalls and natural barriers like mangroves. These are long-term investments, and could cost $100 billion or more, over the next 50 to 100 years. And this, once again, highlights the importance for us to save up our reserves for rainy – and quite literally, stormy – days.

Concluding remarks

25       The many efforts and initiatives I have mentioned this evening are long-term and multi-generational. They do not just end with this term of government, or the next. In fact, the benefits may not be reaped until way past our own time here.

26       There are trade-offs to be made and some of the policies may be unpopular, and may perhaps not sit well with everyone. Ultimately, every dollar that we spend on climate change mitigation and adaptation – as well as the many policies we have to ensure sustainable development and intergenerational equity – comes from a dollar that we could have spent on meeting current demands or support for those who need it.

27       But these long-term projects are not wasteful expenditures. On the contrary, these are critical projects that are needed to ensure the very survival of the nation. There will be no more Singapore for our grandchildren and their grandchildren if we fail to plan ahead or mitigate the existential risks we foresee today. We must therefore continue to save up, plan for the future, and work together to implement these projects over the decades and centuries to come.

28       This tension between the current and future generations – as well as the need to strike a balance between these two – is not unique to Singapore. Through this Symposium, we hope to engage in meaningful conversations with countries and organisations around the world to explore the various challenges and opportunities in this topic. 

29       Thank you, and I look forward to a fruitful discussion this evening.