Could a 'two Singapores' scenario play out as middle-class residents feel the squeeze?

Of late, Singaporeans have been seeing a lot about their country in international media headlines.

The city state's emergence as the stand-out star of post-pandemic recovery in Asia has drawn global attention to the wave of super-rich families parking their millions in family offices, surging sales of Rolls-Royce, and skyrocketing golf membership fees.

Carmen Wee, a Singaporean in her mid-fifties, said the news about the global elite flocking to her home country - dubbed the "Switzerland of Asia" - contrasted sharply with her own concerns, such as how the watercress that she uses to make porridge had doubled in price.

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Wee said she was especially concerned for her nieces and nephews, who would soon graduate and face steep costs of living, from day-to-day items like local hawker food to large purchases like public housing flats.

"It's not just about work for them, but work, play, family and how they feel about the country. I think we must never lose that and make sure we protect that for them," she said. "Otherwise, there's always another country that can attract them with a better quality of life and less stress."

This idea of "two Singapores" - one where high salaries, a cosmopolitan lifestyle and global work opportunities abound, and a second with prevailing perceptions of slowing social mobility and rising housing prices - was raised in parliament during the country's recent budget debate.

Opposition chief Pritam Singh warned about the possibility that a "two Singapores" scenario could "easily become a reality that causes friction in society".

"Singapore is a tiny red dot and both these Singapores would unavoidably rub up against each other ... Human nature and the instincts of envy and chauvinism, and a narrative of haves and have-nots can quickly poison society and accentuate cleavages," he said in parliament on February 22.

A TikTok snippet of the speech has been shared widely on the social media platform popular with younger Singaporeans, and on WhatsApp groups.

It is not just the tiny political opposition that has zoomed in on what is seen as recent accentuations of the country's wealth and income gap, as well as signs of a calcifying elite.

In the national newspaper The Straits Times, columnist Chua Mui Hoong wrote on March 4 that the republic was "at a juncture when the internal contradictions of its hyper-competitive system are becoming apparent, causing much angst, from the low to middle to high-income residents".

"They worry if they can attain the essentials of modern life - a home, job, school for their children and caregiving for frail family members. Those who are wealthy, still worry - about access to good schools and whether their children can do as well in a game they themselves excelled in," wrote Chua, whose popular columns are closely tracked by members of the establishment.

Concerns about inequality are not new in the city state. Independent pollster Blackbox Research published a study in 2018, which found that four in five Singaporean respondents were worried about the widening income gap, while seven in 10 felt that income inequality had worsened over the past five years.

Singapore's income inequality is in fact declining, with the Gini coefficient decreasing from 0.478 in 2012 to 0.437 in 2022, according to a recent government reply to a lawmaker's parliamentary question. The Gini index measures the degree of inequality in the distribution of income, with 0 being perfect equality.

Real annualised income growth for full-time employed resident workers at the 20th percentile meanwhile stood at 3.5 per cent from 2012 to 2022, higher than growth at the median level that stood at 2.6 per cent per annum.

Lawrence Wong, the finance minister and a prime minister-in-waiting, said in his budget speech that officials had been seeing results in the country's ongoing efforts to uplift lower-wage workers. He cited how lower-wage workers had consistently seen higher income growth than those earning more than the median over the last five years.

Unveiling various measures that will ease the cost of living, including early childhood subsidies and an expanded relief programme for citizens, Wong added that the government was "open to all good ideas" to continue to encourage social mobility.

Senior business development manager Gary Haris, 49, suggested however that the additional aid would not go far.

He said that a S$300 (US$222) government-issued voucher, half of which could be spent at participating supermarkets, can be used up in a single trip.

"The ongoing discourse shows that it is hard for Singaporeans to buy into macroeconomic plans, or how Singapore has dealt with the problem better than other developed nations, when even the possibility of having a secure roof over one's head feels in jeopardy," said Nydia Ngiow, the managing director of the BowerGroupAsia consultancy in Singapore.

It is vital for the government to manage these concerns for citizens, especially the middle-income group, who may face a disproportionate squeeze from the tax increase and are not the main beneficiaries of government handouts, analysts said.

Bilveer Singh, associate professor of political science at the National University of Singapore, said the challenges were shaping up to be an election issue, ahead of polls that may be held next year. "Because for Singaporeans, economic issues are the primary issue," he said.

"It can also generate friction between the people and the government if the latter is not seen as doing enough to help those impacted or the perception that the system is weighted in favour of some groups over others," said Eugene Tan, a law professor at the Singapore Management University.

"The harsh reality is that no assurance is ever enough in a time of economic uncertainty, short of never-ending handouts from the public coffers, which may also exacerbate the economic situation," he added.

"Matters are perhaps exacerbated given that the cost of living concerns have come on the back of the global pandemic."

This article originally appeared on the South China Morning Post (SCMP).

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