Look beyond GDP measure of growth, urges MP

Channel NewsAsia 21 Oct 11;

SINGAPORE: MP for Pasir Ris-Punggol GRC, Penny Low, has called on the government to aim beyond the GDP measure of growth and look at a more holistic national measurement system.

Ms Low, who is on the Government Parliamentary Committee (GPC) for Information, Communications and the Arts, Environment and National Development, said this in Parliament on Friday.

She said GDP does not give the finer points needed to understand if growth trickles down to the common man, and if it contributes to his or her sense of well-being.

Ms Low suggested taking into account personal capital - which refers to a person's value system, social capital - which looks at a community's wellness, and environmental capital - which takes into account environmental security and biodiversity.

She suggested commissioning a report on what the priorities of Singaporeans are, and the role that citizens, communities and businesses can play alongside the government.

Ms Low said: "Well-being is no fluffy stuff. In fact, people and communities with a higher sense of well-being are more adaptable and resilient. These are the exact future readiness traits needed for a more volatile and fast-moving world.

"And if growth in Singapore is conceptualised in the manner (that is) set out, we can continue to ensure our citizens have little affinity to be disillusioned, (unlike the) Occupy Wall Street protesters. We can continue to buck the trend and progress."

Meanwhile, Minister of State for Home Affairs and Foreign Affairs Masagos Zulkifli reminded Singaporeans not to lose sight of the nation's fundamentals, even as it undergoes adjustments.

In his parliamentary speech on Friday, Mr Masagos identified three areas as the cornerstone of Singapore's society.

These are: strong families that nurture and care for each other; citizens who contribute to the welfare of others; and a democratically elected Parliament and government that execute policies for the good of its citizens.

Mr Masagos said: "Even if we must extend more support to single mothers, we must not inadvertently destroy the institution of the families. Even as the government must do more to help the disabled, we must not unintentionally discourage philanthropy, charity and self-help initiatives.

"Even as we become more plural in Parliament and society, we should ensure that the heads, hearts and soul of our nation remain united, and are in harmony."

-CNA/ac/ls

Going beyond GDP index: Call made by PAP MPs previously
Janice Heng Straits Times 22 Oct 11;

PEOPLE'S Action Party members called for measures of well-being that go beyond gross domestic product growth before this week's debate, Ms Penny Low (Pasir Ris-Punggol GRC) said yesterday.

Ms Low told the House: 'It is important that this Government aims well beyond the GDP measure of growth.'

On Monday, Ms Sylvia Lim (Aljunied GRC), chairman of the Workers' Party, had proposed that Singapore consider a national index of happiness and well-being.

She noted that Singapore was a co-sponsor of a United Nations draft resolution, submitted by Bhutan, that called for such additional indices.

Besides sustainable, fair socio-economic growth, Bhutan's Gross National Happiness index takes into account issues of environment, culture, and governance.

Ms Lim's speech was met with scepticism from PAP MPs, who said Singapore was not comparable to Bhutan.

Yesterday, Ms Low noted that she - and other backbenchers - had called for such indices in previous Parliaments. She thanked other members of the House for joining the call.

GDP figures alone do not show whether growth 'properly trickles down to the common man', or whether it improves his sense of progress or well-being, said Ms Low.

She went on to suggest what an alternative index might look like. Besides economic capital, it would include personal, social, and environmental capital.

The first involves a person's values, health, and hopes; the second, social connection and the community's wellness; and the third, food security and environmental issues.

'It is time for our national measurement system to move from measuring just one aspect of our national assets - our economic capital - to an integrated, holistic measure of all four capitals,' she said.

The Government should commission a report to find out what Singaporeans 'really want' in these four areas, she said.

That could help in setting policy directions.

Ms Low also commended social enterprises, which help achieve quality growth by providing market solutions to social problems. Local restaurant chain 18 Chef, which employs former offenders, was one such example.

Such enterprises need support - for instance, in the form of grants, or hybrid regulation that allows them to tap help ordinarily reserved for non-profits.

'Grow it like a strategic industry,' she urged, 'because it is strategic to our inclusive and quality growth objective'.

Slower growth, if inclusive, 'may not be bad'
Benefits can be shared more widely: Experts
Aaron Low Straits Times 22 Oct 11;

SLOWER economic growth in Singapore may mean smaller pay rises, and companies in some sectors will shut down and move out of the country.

However, the outlook may not be all doom and gloom if a phase of slower growth means the concerns of some lower income groups are addressed by the Government.

A shift into the economic slow lane could translate into benefits shared more widely across the country, and a higher quality of life, if the idea of inclusive growth is pursued, said DBS economist Irvin Seah.

'There have been a lot of unhappy people complaining about housing and public transport, so if the Government addresses these, a slower but more inclusive growth rate may not be a bad thing,' said Mr Seah.

Prime Minister Lee Hsien Loong told Parliament on Thursday that a confluence of factors, including domestic constraints such as land and population, and rising competition may mean a slower pace of growth in the next decade.

Mr Lee said: 'If we can make 3-plus per cent over the next 10 years, I would say we would have had a good decade.'

On the outset, the more moderate pace of growth may mean slower incomes and job growth, said Bank of America Merrill Lynch economist Chua Hak Bin.

Labour intensive sectors such as low-end manufacturing will probably move out in greater numbers and more quickly as many will not be able to cope with the new higher cost landscape, he said.

'Tighter foreign worker policies will make it harder for such firms to operate here,' he said.

Dr Chua also noted that the 'grow as fast as you can' model produced a surge in fiscal revenue and enabled the Government to give generous handouts in past Budgets and the fiscal flexibility to enhance the social safety net.

'Risks of a 'new normal' growth model, despite its focus on inclusiveness, is that lower growth also reduces fiscal surpluses,' said Dr Chua.

'That may, in turn, limit the extent to which the Government can dish out special transfers in future Budgets, including to lower-income households.'

Citigroup economist Kit Wei Zheng said the growth rates of the past pushed the economy to its limits, and nearly overheated the economy.

The economy posted an average annual growth rate of just under 6 per cent a year from 2000 to last year. This is higher than the long-term growth potential rate of between 3 per cent and 5 per cent.

'The transition towards this more inclusive slower pace of growth will be painful as policymakers unwind the excesses of the past model,' he said.

Job creation may slow as companies start moving out, and inflation may rise in the transition period. 'Wages may continue to rise due to restrictions on foreign manpower, but this in turn may translate into higher inflation as companies pass down the costs to consumers,' he said.

But economists also noted that despite the economy growing at nearly 6 per cent a year in the past decade, median incomes rose by just 1.2 per cent a year.

Part of the reason is that most of the growth generated was channelled towards company profits, and not worker pay, said Mr Seah.

'Changing this whole model requires a radical shift on our part,' he said.

Still, if the Government continues to spend on infrastructure and pays attention to those on lower incomes, Singaporeans may well end up a happier lot, said Mr Seah.

Similarly, Mr Manu Bhaskaran, chief executive of Centennial Asia Advisors and vice-president of the Economic Society of Singapore, said that if the Government pays more attention to improving the social safety net, Singaporeans would be better off.

'It is not headline growth alone that is important. It is the net impact on the welfare of Singaporeans,' he said.