PM Speech 2008 - Part One

1. Keep our economy competitive, we've got to produce more, be more productive.

Tonight I will start by talking about the economy. I haven't done so in detail over the last few years because the economy was doing well. So we were focusing on social issues - income gap, ageing population, CPF. But it's timely to pay some attention to the economy now because conditions this year are more difficult.

Over the last few years when conditions were good, we surged ahead. We did the right thing. We planned, we pushed, we built up our momentum, restructured and upgraded our economy & brought in a pipeline of good projects - F1 Grand Prix, the IRs (Integrated Resorts), our financial services, banking doing well, major investments brought in by EDB (Economic Development Board) through very hard work. And now these projects will sustain our momentum & keep our economy going.

But dark clouds have gathered around us in the external environment. The US faces very serious problems. Their house prices have ballooned, bubbled, crashed and are still falling. Unemployment is going up. Consumers are losing confidence, spending less. And it's affecting the rest of the world as has to be expected. And Europe, the major economies, have gone into negative growth, and we must expect impact on Asia also.

These global economic problems will continue at least into next year. And some experts think it may last even longer.
We are starting to feel the impact in Singapore. In the second quarter our growth has slowed down, our manufacturing sector has been affected, our exports are weak this year, tourist arrivals are down. Even Asian tourists are travelling less, partly because airline fares have gone up - the fuel cost. Retail stores say that customers are more careful, and restaurants have also fewer guests now in Singapore. Singaporeans are more careful with their money.

This year I think we can get four to five per cent growth. It's not bad. Next year we expect slow growth and more uncertainties. I'm not predicting a crisis. We're competitive. Investors still want to come to Singapore. And we have a strong pipeline as I explained, but we have to be vigilant and we have to be psychologically ready in case of trouble. But we also must be on our marks, so when the global economy recovers we can bounce right back up.

Costs of Living

Right now the hottest issue for Singaporeans is the rising cost of living. Inflation is not just a problem for Singapore. It's a worldwide problem because oil prices have gone up, food prices have gone up. I show you a graph of oil prices over the last few years and you can see how in 2000 we were paying about $20 a barrel and gradually it went up $60, and in the last one year it spiked all the way up nearly 140. Now back to about $115 a barrel

Food is an even more dramatic story. I show you rice because that's what affects Singaporeans. And you can see the price has very stable for a very long time, gone up a bit two years ago, and in the last one year tremendous spike, now come down some to US$800 per ton. And maybe it will stabilise there or maybe it will come down a little bit. And similarly with oil, there are some signs that maybe it will come down a little bit. But even if it does, it's still high and it's quite understandable why people are agitated all over the world and demonstrating, rioting, protesting, blaming their governments.

I show you some slides from around the world.

This is Europe. These are truckers in France protesting about diesel prices. So they are blocking the roads.

This is Spain. Farmers put all their tomatoes on the road because their fuel prices have gone up.

Indonesia - the government raised prices of kerosene, demonstrations and riots.
Pakistan - we're not having a dance. We are showing their displeasure at their government, because food prices went up.

Philippines. Philippines sells their people subsidised rice, ran short of supply, there was a scramble, mad scramble. The government had to scramble internationally to buy rice. Domestically long queues. Big problem.

Fortunately in Singapore we have plenty of rice. So you don't see riots. All you see is Mr S. Iswaran, Senior Minister of State for the Ministry of Trade and Industry, inspecting our rice stockpile. But I know that people are unhappy still about the price increases. I've read a lot of the interesting things on the Internet. Some are quite good. I don't have time to show you all of them, but I'll just show you one tonight. This one says: "Wapiang eh! The ERP has reached Pedra Branca." I sent this to Raymond Lim. He said that's his favourite one too.

I completely understand how Singaporeans feel and why Singaporeans feel like this. But we have to react rationally to understand what's happening to us and what we can and cannot do about it. We can't prevent prices from rising in Singapore.

We import all our food except for a few eggs, and Mah Bow Tan reminded me a few fish. We import all our fuel and all our electricity is produced from imported either fuel oil or natural gas. So when the world prices go up, how can we keep our rice prices, our petrol prices, our diesel prices, our electricity prices down?
It can't be done. In terms of dollars, your wages have not gone down because most workers are earning more dollars this year than last year. Last year was a good year - people got good increases, got good bonuses. So you have more dollars. So when you spend those dollars, you find that they have shrunk. And with inflation, what that means is that some of your wage increase went to you, some of that wage increase went to the people who sell us oil.
So to put this in a very simple over-simplified way, the oil producers of the world have got rich. The Russians, the Arabs, they've got rich. The oil consumers of the world like Singapore, therefore we have got a little bit poorer. That's what it is. They are richer, we are poorer. How has it happened? Not by taking dollars away from you but by shrinking each of your dollar a little bit smaller when you spend it.
Singaporeans wish that the government would do something to stop these prices from going up, just order them to stand still, control them, don't let them go up. Some governments try to do that. But the subsidies cost huge sums of money and all the governments who try to do this have very serious problem on their hands.
And even those who produce oil and gas find this very hard to sustain, because you look at Malaysia. They subsidise oil, but what happens? Singaporeans go to Johor Bahru to top up. And Thais go across from Thailand into Kedah to top up - not your petrol tank but the huge special tank in a truck so as to get maximum benefit. And they are oil producers.

So they've had to cut their oil subsidies and push up prices recently. Malaysia, Indonesia did that, also an oil producer, China - produces some oil, India also - no oil but they were subsidising. It's untenable. We can't do that but we can help Singaporeans. And the way we help Singaporeans is to let the electricity price go up but to top up your SingPower accounts with U-Save and give more U-Save to the poorer households - three-room flats, two-room flats.

And what that means is we're helping you directly because U-Save really is cash. We're putting it into your account, up to you to spend. And if you use it for electricity, well then it helps you to cover your bill. If you
use less electricity, it will last longer. But it's a lot of money because for the lower income households - three rooms and below - it's worth three to six months’ worth of your electricity bills, of your utility bills. So that's a lot of money.
So we can help but we have to help in the right way. And this year we've done more to help Singaporeans. We foresaw this spike in inflation last year. Towards the end of the year as prices started rising, we knew that Singaporeans would be worried. We started planning what we could do to help them, what we could do to reassure people.

And when it came to the Budget, fortunately we had a surplus last year, we were able to make a significantmore for the lower income groups, needy. So we have Growth Dividends, Medisave top-ups, U-Save, so many measures, such long lists but all to give help where the help is needed.
Besides the Budget we have many other measures to help the needy. For the lower income workers, we've got Workfare to top up their income and savings. And this year in the National Wages Council deliberations, we made a special one-off payment to the low wage workers. We recommended it and many employers have done it because we knew that they would be pressed this year.
For the destitute, we have Higher Public Assistance rates, which we've revised up this year. I think it's now $330 per person. We've got ComCare, we've got Medifund. And for retirees, we've pushed up the CPF (Central Provident Fund) rate, which was one of the things we discussed here last year at the rally. One extra per cent interest on the first $60,000 of your balances. And it's come into effect this year and it will help to preserve the value of your CPF savings for your old age. So it's helpful to retirees, it's helpful to the young people and not so young but not yet old. Overall it's $3 billion from the government this year, and I think that's not a small sum of money.
I know that many Singaporeans who are not so poor but also not so well off feel that they are pressured - middle income Singaporeans. And they feel that they're the sandwiched class, stuck in the middle. But when you ask who's the sandwiched class, all the way from quite low down to quite high up, it's a very fat sandwich. But they feel sandwiched, and we haven't forgotten them.
We've got Growth Dividends extended to them. We've helped them with their education costs. For example, the polytechnic and university bursaries have been extended, so large proportion of students are now eligible for bursaries. We've topped up the post-secondary education accounts for all school-going age children. And that includes all of the middle income groups. And that's a big sum of money. I know that the middle income put a lot of emphasis on education, and this is one way to build up, so when your kids go to poly or university, well that little kitty, that nest egg is there.

But overall I think our most important strategy to help the middle income group is to keep our taxes low and therefore minimise your burden. And if you look at our personal income taxes, actually they're already lower than most other countries. And for middle income Singaporeans, in fact our income tax is lower even than Hong Kong by quite a lot. And on top of that, this year we gave a generous 20 per cent personal income tax rebate in the Budget, costing us nearly $400 million aimed at these middle income Singaporeans. So I think if you look at it in perspective, we have done a great deal to try and help the middle income Singaporeans.

I know there's one item which middle-income Singaporeans worry a lot about. And that's cars. And car-related taxes are something which the government studies very carefully.

I would acknowledge that at one time the car-related taxes were a significant burden on car owners and many of them are middle-income. Because our car ownership taxes have become so high, we needed to control the number of cars, we have pushed up the ARF (Additional Registration Fee), excise duty, so many items and the amount per car was very high and it was disproportion.

So we discussed this when we had the Economic Review Committee a few years ago which I chaired and we decided to make a major policy shift to shift from ownership to usage so that we could bring down the ownership taxes, ARF, excise duty and so on, we could issue more COEs (Certificates of Entitlement) so that they will be more affordable, then we could enable more people to afford cars but to do all these good things, we would have to push up ERP (Electronic Road Pricing) so that we can control traffic jams on the roads. And in fact, we have moved decisively on that.
I put together some figures to show you. It's easiest if I show you on a graph but if you compare 2000, before we moved, and 2008 where we are today, you will know how far we have come.

In 2000, the government collected $6 billion in vehicle-related revenues, $6 billion, it's a huge amount of money. It's like two or three times the amount of GST (Goods and Services Tax) we collected in that year. Because we have changed policy by 2008, the amount has come down. Halved, $3 billion. So we've given, effectively we have saved Singaporeans about $3 billion of tax. And this includes everything but to do this we've had to push up the ERP, by how much? In 2000, that's all the ERP there was, $80 million. This tiny sliver at the top of the whole stick.
This year, after a lot of ERP adjustments, we've doubled it. It's $160 million, but still very small compared to the total amount of road tax which we have collected. And despite this, in fact we have still made this big reduction in the road taxes which we have collected, which is savings to Singaporeans. And because of these savings, therefore more households have been able to own cars.

In 2000, there were about 320,000 households owning cars. Since then, in the last eight years, the number has gone up. Now 430,000 households had own cars, which is about one-third more, 100,000 households. I think this is something which is worth trying to do because many Singaporean households want to own cars and we've been able to enable more of them to do so. How have we been able to do that? By bringing down vehicle taxes and how have we been able to do that? This little red sliver here, by pushing up the ERP.

This is in terms of overall gross numbers, billions. But if you are buying an individual car, one household, one car, you can see the difference. So I have chosen as an example, a 1.6L car, typical Toyota Corolla. It was there in 2000, it is there this year.

In 2000, how much do you think it cost to buy a Toyota Corolla all in? $110,000. This year, same car, in fact the salesman will tell you it's a better car, the price has gone down to $64,000. And this is mainly because the government taxes have come down, because the OMV (open market value) has remained about the same. It's about $19,000 before, now it's $16,000 now. So basically, the government taxes have made the cars a lot more affordable. So the result of this is that there are more cars around us. You can see it, HDB car parks getting more crowded. You can see it on the roads. And therefore because of this, this year we've had to increase ERP charges.
I know many people are upset by these ERP charges but we have to see the bigger picture because in fact, the ERP charges are enabling us to benefit Singaporeans so as to reduce the burden on you and to enable more Singaporeans to own cars. So when we have to make the adjustment this year, we considered it very carefully, how should we do this without increasing the burden on Singaporeans? And we worked out an ERP package, not just raising the ERP or putting more gantries but reducing road tax at the same time so as to offset it and overall to bring down the cost.

Let me show you how this works. Before the package, let's take the 1.6L car again. Probably a Toyota but could be another one. Before the package, the ERP was $122, after the package, it's gone up, nearly 200. So it looks very frightening but in fact if you consider the road tax which you have to pay and which we have adjusted, you used to pay $874 of the road tax and now it's come down to $744. So the net effect is that you have a saving, in fact you are saving money rather than out-of-pocket because of the ERP changes. How much? Let's do the sums.

ERP increase, $76. Road tax reduction, $130. Net savings, $54. So overall, there's a net saving from this package. So we have not increased the burden on Singaporeans, we've actually reduced the burden on Singaporeans by some. The trouble is people may not realise or remember how much road tax they are paying, or even worse, how much road tax they paid last year. And sometimes they may not be the one to pay it.
I asked one driver how much road tax she paid because she was complaining about the gantries she went through and the beeps which she heard. So she thought a while and then she said to me, I'm not sure, I have to ask my husband. Because she didn't pay the bill, her husband paid the bill and I'm not sure even when the husband paid the bill, he noticed that it was smaller this year. And furthermore, when the husband pays the bill, there's no beep, beep. But when the wife drives the car, each gantry, one beep.

So, that is a problem and I think that's part of the reason why people are not happy. And so we have to draw the connections and get people to understand that actually the middle-income Singaporeans have benefited from government policies.
But we haven't only thought about road tax and car drivers because the point of all this is to have a system which will work for all Singaporeans and that means improving our public transport. So together with pushing up the ERP, we are building more rail lines, we have more trains running, about 800 more trips every week. So the waiting times have come down. The over-crowding during peak hours has come down. Bus service are getting improved. We are making the transfers more convenient and cheaper because the transfer rebate will go up.

So we are doing many things. We can't in the end have every household in Singapore own a car, like in America. That's not possible. But what we can do is to have the roads free flowing and a first-class public transport system for everybody.
Besides cars and public transport, we also have to pay attention to the wider needs of the public. And you can get a good sense of what the public is worried about by looking at the mix of MPS (Meet the People Sessions) cases which the MPs hold. And I do my own MPS from time to time. The MPs do regularly. And I can tell you what we find. Not many job-seekers, unlike during the last recession because there are a lot of jobs to go around. There are some hardship cases but we have a lot of schemes to help them. We got vouchers, we got Comcare, you got CCC (Citizens’ Consultative Committee) and CDC (Community Development Council) programmes and so on. I talked about some just now.

But there's one worrying trend in the MPS cases and that is there are more and more people looking for HDB rental flats. And in one year, the number of applications have gone up, tripled. And now they form the bulk of our MPS cases. The biggest group is people looking for rental flats. Many many reasons.

HDB is building more rental flats but they will look into the applications. Not all of those who apply for rental flats are truly needy. And HDB gave me some examples. I show you one where a woman aged 60 was applying for a rental flat. And she had three children. Two of them live in private property and the children wrote down, don't worry, we will jointly hire a maid to look after our mother. Please can she have a rental flat?

I think families must have their problems, otherwise they would not go to look for MPs or HDB for help. But I think that for this group of people, rental flats are not the right solution. Instead they should look for other viable alternatives. They can rent out a room, they can even rent out the whole flat, move in with their children. We are going to have the lease buy-back scheme for the two-rooms and three-room flats which is going to be implemented next year.

Or they could sell their flat and move into a smaller flat, or move into a studio apartment, also with a short lease and therefore free up some money. So there are various ways they can solve their problems but I think we have to manage this rental flat problem and MND (Ministry of National Development) and HDB will be reviewing the scheme for rental flats so that we can keep it an effective safety net for the people who need this, the minority of genuinely needy families who have not only no income but also no assets and also no family support.

So I've talked about the poor, I've talked about the middle-income, I've talked about those who need housing, rentals. I think for the vast majority of Singaporeans, we've provided comprehensive measures in the Budget. Most people do not realise how much they are getting and as I said in the Chinese speech just now, if you take a three-room flat, a low-income household, say an elderly couple with one child working, they are this year from the government $5000, all in, which is much more than any increase in their cost of living.

And if you take a middle-income household, five-room, let's say middle-aged, working parents, two children, which is a typical profile, they get not a small sum either, about $3,400, and that's not counting any personal income tax rebates which they may be getting.

So I think we've done a fair amount to help Singaporeans but inflation has turned out higher than expected, especially electricity and fuel prices, and the economy is a bit more uncertain than the outlook at the beginning of the year. So I think after looking at the Budget position, we can do a little bit more.

There's a second instalment of the Growth Dividends coming on 1 October and we will increase this by 50 per cent. And because energy, electricity is such a heavy bill now and some people's bills have gone up by 100 per cent, even more, so this year's U-Save rebates, we will also push it up by 50 per cent, which means for a three-room household like the one I mentioned earlier, they'll get about $500 more all in and a five-room household will get about $200 more.

And overall, this is going to cost us $250 million to the government, a quarter billion dollars. If you add it to all the other things we are doing, I think it will help Singaporeans see us through this period.

But I would say, please don't think that hong baos are going to solve this problem. We can't give hong baos all the time and giving ourselves hong baos does not help address the problem of the oil producers becoming richer and Singaporeans becoming poorer. To address that problem, we have got to keep our economy competitive, we've got to produce more, be more productive. Therefore earn more for ourselves, then we can raise our standard of living, despite increases in oil and food prices.
The well-being of Singaporeans depends not just on bread and butter issues but also on our human and social environment, which means on how we behave, how we relate to one another as Singaporeans. How can we make Singapore a more gracious society?

2. Go the Extra Mile for Singapore. Service Excellence. Genuine warmth and the sincerity. A whole atmosphere of friendliness and hospitality.


We’ve done many things over the years to improve ourselves. We’ve got all sorts of campaigns and initiatives - queue up, be courteous, no spitting, please flush toilets, most recently, service excellence – Go the Extra Mile for Singapore.

Sometimes people laugh at us. But actually these are things which we can work on and improve. And if we make people aware of their behaviour and conscious of the impact on others, we can educate them and gradually they can learn new habits and they will respond and our social norms will upgrade.

And we have made progress. For us living in Singapore seeing one another day by day, you don't notice. For people who come here once in a while and see us at long intervals it's like on one of these speeded up movies, they can see the difference. There was a letter in The Straits Times forum page recently which was very interesting and I was very moved reading it.

It was from a Sri Lankan lady who had visited Singapore 40 years ago when she came here on her way to America to be a post-graduate student. And she came back again recently, now much older and she needed a wheelchair at the airport. And she spent a few days in Singapore. And she was especially moved to write this letter which The Straits Times published, and let me read a little bit of it:

“From the moment I landed until I left, the city impressed me... Everywhere I met only kindness... I was in a shopping centre and asked a young girl the way to the MRT \[Mass Rapid Transit\] station. She offered to show me the way, and taking my shopping bags, led me to the station...Shopkeepers gave me water to drink, people waiting for a bus walked with me to the correct bus stop, and people helped me cross the street. I have never experienced this sort of kindness anywhere else in the world.”

I think she must have been a very nice lady. But the people who behaved so well to her flew the flag for Singapore. We don’t know who they are but we should thank them. We can do even better of course. We have a Singapore Kindness Movement and it conducts surveys of social behaviours that Singaporeans consider important and not important. And they showed me a list of the different things – quite interesting. Not important, considered not important doesn’t mean really not important. But considered important at least shows me where some of the problems are.

So, some of the things we’re good at is sitting properly at the cinema – don’t put your feet on the chair in front of you. Very difficult for tall people like me. Say “thank you” after being served – that people remember.

But other things not so good. Say “please” – not so common. Clear tables and return food trays – need to improve. We’re trying to inculcate this habit. I don’t understand. Every national serviceman knows exactly what to do in his cookhouse. Maybe need more reservist training. But at Suntec City no reservists, no NSmen \[national servicemen\]. So it’s going to take time to change the mindset, because the mindset is, I go to the foodcourts to eat and not to clean tables.
So I got a letter recently from somebody, a lady, an e-mail, talking exactly about this, about how we should make Singapore a more happy place to live. And she mentioned this. She said: “Actually we should feel quite embarrassed to leave our dirty plates and dirty tables for the next diner. In my mum's house, after eating, we will clear our plates and clean the table... This is a good habit we should adopt outside the home.”

Then she went on to add: “Oh yes, most importantly no fines, no fines. Dishing out fines hurt relationships and no good image for PAP (People’s Action Party) government.”

So I thanked her for her good wishes which I’ll try and find some way before thinking about fines. One of the ways we’ve thought about, which MediaCorp thought about, was to hold a contest on Morning Express Class 95 FM. And we have the DJs, famous people Glenn Ong & the Flying Dutchman who are here tonight. And they invited listeners to send in their videos of the best and the worst Singaporean habits. Tremendous response. So I asked Mediacorp to compile some highlights, good & ugly, to share with you.

This is staying on one side of the escalator going up, so people can pass you.
The cab stealer. This one on a bus, public transport. This one crossing the road, red man flashing, all over the shop. “My grandfather’s road, mah!” This one gets the gold medal.

So there you are. I think the film-making is outstanding, the conduct can be improved.

I think the best way to focus our efforts is when there is a major event and we’re put to the test. And we’ve done well before – the International Olympic Council meeting in 2005, the IMF (International Monetary Fund) and World Bank meetings in 2006, and we put on a really good show, not just to impress people but because that’s the way we want to be.

And now we’ve to prepare for other major events: F1 next month, Apec \[Asia Pacific Economic Cooperation\] next year, Youth Olympic Games in 2010. Let’s use these opportunities to improve our social graces.

This is how other countries have done it. The Olympic Games Sydney 2000, it set a very high benchmark. The show was very good. But what really impressed visitors was the genuine warmth and the sincerity of the Australians. There were 47,000 volunteers. They cheered, they drove buses, they manned checkpoints, they greeted visitors, they were friendly, effective, polite. They said: “G’day mate”. And after a while you know what that means and you feel welcome, created a whole atmosphere of friendliness and hospitality.

China is now hosting the Olympic Games. They’ve made a huge effort to welcome the athletes and the visitors. And you watched the opening ceremony, that’s spectacular. But what you may not have noticed, that they had launched large-scale civility campaigns to educate people. And they designated special days of the month for special movements.

So the 11th of the month is queueing up day - ‘pai dui re’ – because 11 (one one). The 22nd of every month is give your way to others, give your seat to others day - ‘rang wei re’ – because 22 looks like two chairs side by side.

For the games they mobilised 100,000 volunteers, mostly young men and women, university students, others. And tremendous pride in their country and every willingness to go the extra mile impressing the visitors, that here is a people who are proud of their country and who want to make visitors feel welcome.

So we too should mobilise ourselves for the YOG (Youth Olympic Games). It’s the first time ever the games are being held. So let’s make a special effort to make sure that it is an outstanding YOG [Youth Olympic Games].

We mobilised very successfully to support the bid when Teo Ser Luck went around – he’s not here, he’s in Beijing tonight – and Singaporeans from all walks of life spontaneously organised themselves to participate: schools, youth groups, companies, taxi drivers. And I think this grassroots participation impressed the IOC (International Olympic Committee), and so we won the bid. So let us rally together again, show what Singapore is about and welcome the world with our spirit and our warmth.

But we musn't just stop at the YOG. We’ve got to work consistently at this patiently over many years, strive for higher standards and a permanent improvement in our behaviour. Not for other people, for ourselves so that we can be proud of ourselves and to make Singapore a better place for all of us.

I’ve just got an update on the game. Singapore zero, China two. The game is still progressing.

3. Babies. Pro-Family & Work-Life Balance
Family responsibility, Relationships, Domestic Science


We’re creating a better Singapore for future generations to enjoy. So my next topic is babies. This is a very long story. So I’ve prepared a special slide which captures the story.

This is a slide which shows our total fertility rate (TFR), which means the average number of children born per woman over her lifetime. And this shows the TFR from 1960 all the way to right now 2007, last year, coming down like this.

And this single slide tells us about our history, about our economy, about our culture, and about our policies. Let me show you. The history is this graph, from six children per woman in 1960 coming down to the mid 70s to 2.1, which is the replacement level, because you need about two children per woman to replace herself and her husband, and then continuing to go down till it’s about 1.3 today.
It’s the same story which we see in Korea, in Taiwan, in China. All over Asia, as the economy developed, as we educated our people, as women got jobs and they were liberated, they stopped, just having one baby after another at home, and the numbers came down. That’s our history.

But if you zoom in into the last 30 years, you will see more interesting detail, starting with the way our economy is, because actually people have control over when they want their kids.

So when the economy goes down and times are uncertain and people worry about where they’re going to get their next meal, they put off having children. So you look at the graph coming down, but the times when it comes down sharply like here in the mid 1980s, it’s usually because the economy is not doing well. There was a recession in 1985, which was quite a problem.

In the late 90s it’s gone down again. That was the Asian crisis. And then if you look down here, comes down again – 9/11 and Sars (Severe Acute Respiratory Syndrome). So, each time there’s a crisis, people put off having babies. Crisis passes, numbers bounce back up, but never quite go back to where it used to be.
But we can see something else very interesting in this graph. Look at the peaks rather than the low points. Take this one – 1976. Why is that? You take this one, another peak – 1988. Then you look at the next one – 2000. Dragon years. But each dragon smaller than the next dragon. So 2012, I worry for the little dragons.
You can also see our policies in this chart, family policies. In the 1960s the policy was “Two is Enough”. Fabulously successful. In fact, oversuccessful. We had a poster. You remember this. “Girl or boy, two is enough”. Two little girls. We achieved the target. We overfulfilled our plan. Went down.

In the late 80s we had to change our message: “Three if you can afford it”. So this was after the dip here, we got alarmed, we changed. Say, three kids. And it worked, there was some effect. Quite successful, went up, the dragon helped. But it stayed up for quite long. And then unfortunately it came down again.

And then we decided we needed some more policies. So we had baby bonus in 2001, and child development co-savings scheme – that’s the proper name but actually we call them baby bonus. And that unfortunately didn’t work because we were hit by 9/11 and Sars.

And come here, 2004, this is my little contribution, my first rally – marriage and procreation package. You see we’ve given up having a lot of pictures. Just one little infant. And if you study the graph very carefully you can see that in fact there was some improvement. Just a little bit. But you really can’t see it very well. We need a magnifying glass. So if we zoom in with a magnifying glass.

2004 – 1.26; 2007 – 1.29. So improvement. But the target is 2.1. So 1.5 is here, 2.1 is here. We have a problem. So the question is, what more should we do?
I think first we should encourage people to get married. And second, we should encourage couples to have children. The first step is to get the right partner and get married. I am not an expert in this. So I consulted the experts, those with the experience, and I talked to some of the matchmakers. We have SDU (Social Development Unit), we have SDS (Social Development Service). We have quite a number of private dating agencies now which have come along. So I talked to several of them.

And we had a very lively lunch exchange. I learnt a lot from them. And it’s fabulous material for a TV studio discussion, which one day they will do. They told me so many interesting stories. They put it graphically in real people’s lives the practical problems and how it works and what the difficulties are. So let me just summarise the main learning points because tonight is a lecture, not entertainment.
First of all and encouraging, many singles want to get married. They’re not happy to be single, they want to get married. They are serious, they are not just out to have a good time. But they face difficulties. What are these difficulties? Some have never dated. They didn’t date in school, they started work. Once they settle into a routine, they are older, no chance, no social circle at all, no opportunities to meet new people.

So one matchmaker told me that one conversation he had, he talked to this lady: “What do you do after work? First of all, what do you do?”
She says: “I work.”
“After work, what do you do?”
“I go to the gym.”
“Weekends?”
“I stay at home with my parents.”
“Do you go out?”
“Yes, I bring out my nephews and nieces.”
So he says: “Oh dear, everybody will think that these are her children and will not chat her up.” “So have you met any new friends last week?”
Dead silence.
“How about last month?”
Again dead silence.

So they have a problem – how do you break out of this? Some people date but they start too late. And the dating agencies tell me that the women in their 30s have a big problem. They join up, they sign up, and there are men in their 30s too who sign up.

But the men in their 30s want to look for women in their 20s. Why? They make a very practical calculation: “You see, I'm 30something. Supposing I marry a woman who’s 30something, takes me a year to get to know her, we get married, we want to enjoy ourselves for a couple of years before we think about having babies. Then we think about having babies. You add it up, I’ll be 40something, my wife will be 40something. How?”

So therefore the 30-something-year-old looks for the 20-something-year-old girl. And the 30-something-year-old girl has a big problem. And I feel for her because I had a dialogue with some women, the Women’s Wing organised it for me. And one such lady stood up.

She had great courage. And she stood up and she spoke and she explained her problem, that she regretted. She started off putting her career first. She worked, she built up her career. After she got her career sorted out, in her 30s, she started thinking about looking for a partner. She joined, signed up dating agencies. Tried, no joy. And she was sharing her experience with us and with the room. She still hopes to find someone but it will be quite hard. So that’s a real problem.

The good news is that more people are prepared to seek help from the dating agencies. And the women are more willing to look for help than the men. The men are macho, sensitive about their ego, they don’t want to be seen going for help. The women are more prepared to go. So most dating agencies have more women than men – 60:40. That’s an encouragement to the men to sign up.

But unfortunately sometimes their social graces are not up to scratch. So the dating agency arranged, told me another story, they arranged for a guy to meet a date and the setting was a romantic dinner in a nice restaurant. And the guy turned up in slippers! So he counselled the guy. The guy says: “That is me! I work in slippers. I walk in slippers. I come in slippers.”

So they talked to him, finally persuaded him to buy a pair of shoes, keep the shoes in his car, so before getting down at the date, he puts on his shoes, he goes for the date.

And it worked. So they went a little further. Next thing he knew, the man gave him a call. He said: “What's happening?”

He said: “I’m outside my girlfriend’s house.”

So he said: “Are you stalking her? Why are you there?”

He said: “No, no, no. She has invited me to meet her parents.”

“That's good.” So he asked him: “Did you bring a present?”

So he said: “No.” So he was directed, ran around, bought a present, came back, knocked on the door, went in. Eventually it worked, got married. And then the lady said to him: “Quite interesting. Very unlike you to bring a present.”

So I thought to myself, wow, I was lucky. When I was invited to meet my girlfriend’s parents, I didn’t bring a present either. But fortunately we got married.

But you also need to have realistic expectations. You have to make an effort for the relationship to work. You musn't be carried away by what you see, romantic images from the movies, boy meets girl, boy falls in love with girl, instantly married, lives happily ever after, maybe have twin babies.

But we’re real people, ordinary people in real life. We may not have instant sparks the first time. But you take your time, discover the person for who he or she is, nurture the relationship, and then maybe love may blossom. That’s how many Indian couples do it. They are matchmade. They don’t know each other very well before they marry but they develop the relationship. And it works.

So when I told this story to the women’s group, there were two Indian women sitting in the front row, nodding vigorously. And I talked to them afterwards. They turned out to be immigrants, both have lived here quite some time, both had been matchmade to their husbands, both happily married. And they said: “Yes, this is the way. This is one good way to do it.”

So I think that we have to take a practical approach to this. We’ll do more to help singles get married, to the extent that we can. We have the SDU, we have the SDS – social development unit and social development section in the PA (People’s Association). They're working on this. They're doing a very good job. Now they're catering to different markets - graduates, non-graduates. SDU - graduates; SDS - non-graduates. I think we shouldn't be so rigid. I think we should merge the two, have one more critical mass, more activities, and hopefully more pairing up and more weddings - and more children.

A lot of people want the SDU, SDS because government, so they know it's real, they know it's serious, they know that this is not some escort agency. It's respectable. But there are also young people who don't want the government to know that they're dating and would like to use private agencies but want quality assurance, because just in case the private agency is not respectable, they don't want to be trapped.
So we're going to try to give them the best of both worlds. SDU will go into a new business to certify private agencies that meet quality standards. We have Case Trust. We will have SDU Trust. Put a logo down there.

But young people themselves should take the first step, don't leave it till too late. Make time, go out, meet new friends, join a dating agency, doesn't matter whether it's SDU or whether it's a private one. You may find someone you're attracted to. Then you can marry the person you love. And then you can love the person you marry.

Once couples are married, we'd like them to have children. We used to think this would follow naturally. But it's no longer always the case because couples are having fewer children, having them later, some preferring not to have any children at all. Why?

We looked at other countries. We see it happening all over East Asia, I told you just now earlier. Confucian societies with similar cultural values, undergoing very rapid transformations, social and economic change. So there are powerful social and cultural forces at work which are pushing us in the wrong direction. But it's not just happening in the East, Asian societies. It's happening in Western societies too.
In Australia the government is working hard to encourage couples to have more kids. They've had a baby bonus. They've had tax incentives. They're introducing them now. They have quite a good slogan: "one for Dad, one for Mum, one for Australia". Europe has this problem: many countries facing a dearth of babies.

But there's something interesting in their experience. If you look at southern Europe - Portugal, Italy, Greece, Spain - the countries with the more macho culture, the women are less liberated, they're more likely to stay at home, less chance to work, fewer babies. But in northern Europe - Netherlands, Scandinavia - where the gender roles are more equal, the women are more likely to work, and yet more babies. That's very interesting. Gender roles and this working is something which modern women put a lot of emphasis on.

So what's happening in Singapore? I discussed this when I met the women, married, single, young, not so young. And they agreed that gender roles and helping mothers to work are important. And they gave me many ideas on what we could do to facilitate this. So let me share some with you.

First of all, you have to share responsibilities for child raising. Traditionally the husbands go to work, wear the pants, the wives stay at home, have the babies, take care of the babies. And it's true that women are better and have a better touch with children.

But the situation today is different. And the men can make the effort. If husbands leave everything to the wives, or the women are forced to choose between working or having babies, they are going to go on baby strike. So the husband has to share duties at home.

I was discussing this with some MPs, including a lady MP, and I said: "You know nowadays I see men carrying babies in the markets when they go out." So she said: "You think carrying babies is enough? We got to wake up at night, feed the baby, change the nappies."

I used to change nappies in the days before Pampers. You see actually you got to fold the cloth, you got to put it on, you got to put the safety pin. I haven't pricked any baby yet.

If I can do it, that means anybody can do it. And I think that you have to change these attitudes. We can't change these mindsets by making speeches, but I think we can shift the ethos, the spirit, maybe in schools when it comes to domestic science, we must teach the boys also some of these skills. Try to influence them to have the right expectations and share the responsibility.

But in terms of things we can do, in terms of incentives, I think there are a couple of small things. We introduced child-care leave a few years ago which can be claimed by either parent. It's now only two days a year. I think we can push this to six days a year. I see that women are cheering. The men ought to cheer too.
We will introduce one new thing - one-week unpaid infant care leave per year, either parent, until the child turns two years old. So first two years if some things, you need your infant to go for inoculation or some emergency, well, you can take some time. This is the first thing I learnt from the ladies.

The second thing is that we must have a good work-life balance. You must have flexible work arrangements so that it's easier for women to have both, to work and to have children. And you must have family-friendly employers who will make this happen. So that they make the practical arrangements and their attitude, when you go they don't make a sour face and they don't make you feel a little black mark recorded in your annual confidential report. It makes a big difference.

And with a bit of effort and imagination, you can do a lot. You can provide nursing rooms so that mothers who are lactating can express the milk and store the bottles. You can allow telecommuting and be flexible about it, so long as the work is done. In fact, one company I know of actually allowed one employee to go all the way to Australia with her husband and telecommute from Australia and continued to be paid and do the work. And then she came back and she resumed her job.

You can find ways around having them physically present. So one catering company which has a lot of outdoor catering over weekends, outside catering, supplied their staff with walkie-talkies and with Blackberries so that they don't have to be physically there. They can be with their family, they can go out,but they can keep an eye on the catering arrangements, make sure things don't go wrong. I think such employers we should recognise and thank publicly. And MOM (Ministry of Manpower) and MCYS (Ministry of Community Development, Youth and Sports) will make a special effort to do that.

The Government will help to share some of this burden of the employers. For example, with maternity leave, which used to be eight weeks. We extended it by four weeks. Now it's 12. And the extra four weeks the government was paying. And I think it's been very much welcome by people. So now about three-quarters of women actually take 12 weeks maternity leave.

But if you've ever managed a baby, you'd know that actually 12 weeks is not very long. So I think what we should do is to increase it to 16 weeks. And these last four weeks I think we give some flexibility. Don't make it necessarily all at the beginning. It can be any time in the first year and the government pays for these four weeks also.

But I would say whatever the leave arrangements and what the government carries ultimately the woman or the man must make a personal choice. Do you work 110 per cent on your career or do you set aside time for other activities, for a balanced life? I think each person has to decide his or her own point of balance.
I remember my own experience. I'm a beneficiary of this. My mother was a lawyer. But every day she came home to have lunch with us. So every day we come home from school, three of us, my mother is there, we have lunch. Nowadays you would call it quality time. This was before people invented such big words. All it meant was she had time for us, we had time to talk to her.

And it was a tremendous help. She avoided going out at night for functions. She had to go for, accompany my father, but business functions, very seldom. What it meant is less takings as a lawyer, less work, less conveyancing, but she decided her children were more important to her. And she acted on that and I think she was happy with that. And we're definitely very grateful for that.

Today it's harder to do this. The office hours are longer, the pace is more intense. People call them "office hours". You must put quotes there because it starts in the morning but it doesn't finish after dinner. And at home you are working, on holidays you're working too on e-mail or Blackberry or whatever.

But despite this, I think you have to maintain a balanced, fulfilling life and you have to keep a pace which is sustainable not just for one, two years and you burn out, but for a lifetime and you are in balanced equilibrium, and at the end of your life or when you retire you say I'm satisfied, I had a good career, I've taken care of my family, I've brought up children, this is what life is about.

4. The Individual - Develop at your Own pace. Good Stress / Bad Stress. Stress Management

Understand them, to know that every child has different attitudes, different talents, to give them space to grow up, to let them learn and mature in their own time. Press them to do better but also know them and let them develop the way their nature inclines them

Work-life balance also applies to the children. I know a lot of parents complain about stress on their children, and especially complain because they say the education system causes the stress. We've trimmed the school syllabi - teach less, learn more.

But parents are still sending children, they want their children to do that extra little bit more. So enrichment classes, tuition classes, all sorts of programmes. And before exams, they feed their children chicken essence. So I see advertisements for chicken essence with kids in school uniforms prominently displayed outside schools.

I think some pressure is inevitable. It's part of Singapore's competitive spirit. Other East Asian societies are even more ruthlessly competitive. You look at the Koreans with their cram schools, or the Japanese, they have jukus I think they call them, Hong Kongers. I just read one article about the Koreans. They go there, they inspect your bag. No frivolous magazines, no handphones, no lipstick. You go in, no making friends with boys and girls. It's like a prison. And every day they have one hour of rest, every week they have two hours on the weekend, to get into the right university.

We're not like that. We have some stress but we should manage it, we should take it in our stride. It's natural for parents to worry about children and to encourage them to work hard and do better. But we also need to understand them, to know that every child has different attitudes, different talents, to give them space to grow up, to let them learn and mature in their own time. Press them to do better but also know them and let them develop the way their nature inclines them to develop in many directions. May not be academic, may be sports, may be arts, may be music. But let them go with their nature.

Third thing which I learnt from the women is about the financial cost of having kids. Actually I didn't need to learn this from women. I knew this. It's a significant expense to bring up children.

First the direct child-raising expenses - the milk powder, the pram, the paediatrician. All those things cost money. But on top of the direct cost you also have to think about the opportunity cost for working mothers particularly and for professional mothers especially.

What do I mean by opportunity cost? When the mother is working, she's earning money. When she's looking after the child and she has to work less or less intensively, she has to forgo some income there to look after the child. So her income has come down some. So that's called an opportunity cost. Less work, sacrifice their careers. And that is why often it's the professional women, the more successful ones who say that it's expensive to bring up children. So paradoxically the lower income women feel less opportunity cost, but the higher income women feel it so and say so.

Financial considerations cannot be the motive for having children. I think if you suggest to a couple that you know I give you a bit of discount, how about having more kids?, I think many will be very indignant at this, and rightly so. But it's right for us to help women to lighten the burden of having children. And that's why we had the baby bonus, that's why we had the tax incentives......women to lighten the burden of having children and that's why we had the baby bonus, that's why we had the tax incentives.