Opening Address by DPM Teo Chee Hean at the “Our Population, Our Future” Townhall Dialogue on 9 October 2012

A. Introduction

Good evening. I am very happy to join all of you here today for this townhall dialogue to have a discussion on how we can build a sustainable population for a dynamic Singapore.

As you know, the National Population and Talent Division, or NPTD, is preparing a White Paper which will be completed at the end of the year. We have been actively seeking views from Singaporeans for more than half a year since February/March, about how we can have a sustainable population that will ensure a dynamic Singapore for the future, and the best home for Singaporeans for many more years to come.

Thus far, NPTD has received close to 2,000 pieces of feedback directly and met over 1,200 individuals and representatives of various groupings and organisations. The outreach has been multiplied by other organisations, which have also had discussions and shared their views with us. There have also been views and articles expressed in a variety of fora by many others. I am heartened by the many thoughtful views and feedback. I would like to thank everyone who has taken the time to contribute their views on this important issue, and also encourage more people to do so.

B. What does Our Population Look Like Today?

Before we start the discussion, let’s go through our population numbers. As at end June this year, there were 3.29 million Singapore Citizens. But this is a static view. What’s more important are the longer-term trends. Our fertility rate has been falling steadily over the years, and was only 1.20 last year, quite a long way from the 2.1 that is required to replace ourselves. What’s the difference between 1.2 and 2.1?

tfr-1975-2011

Let me give you an illustration. With a TFR of 1.2, it means that for every 100 Singaporeans in this generation, there will only be 60 Singaporeans in the next generation. And in the generation after that, there will only be 36 Singaporeans. These 36 people will have to eventually support the 60 people from the previous generation, and many of the 100 people from the generation before that, because we are all living to a riper, older age.

tfr-1975-2011

If our birth rates stay at 1.20, and if we do not have immigration, our citizen population will start to decline from 2025. Our workforce of Singapore citizens will start to decline even earlier, from 2020, which is just seven years from now.

tfr-1975-2011

C. Understanding Concerns

While I have described the numbers and trends in terms of total population, I also know that each of us feel the effects of our population challenges at the individual and personal level, in many different ways. Perhaps we feel that the trains are more crowded. Or we feel that our parents or grandparents are growing older, and need more care and support. And we worry about these things. We also hear many views from Singaporeans about what the future is going to be like, for themselves and for their children. So, I would like to start this evening’s session by asking you what concerns you most about Singapore’s population and our future.

Polling Question 1: What concerns you most about Singapore’s population and future?

  • Who will defend Singapore? (Defence and security of Singapore)
  • Who will look after me when I’m old? (Ageing and declining citizen population)
  • Will there be good jobs for Singaporeans? (Job Opportunities)
  • Will Singapore be too crowded? (Quality Living Environment)
  • Will homes be affordable? (Cost of living)
  • Will I feel like a stranger in Singapore? (Sense of national identity)

I think these are all questions which all of us are worried and concerned about, and which have been raised in many of our discussion forums and many of our feedback sessions.

tfr-1975-2011

Home affordability is one major concern. Jobs are another major concern. If we look at the Word Cloud based on the public feedback we have received to date, we can see that the kind of concerns that you are expressing today are pretty similar.

tfr-1975-2011

Housing costs associated with costs of living, living environment, national security, national identity, jobs, ageing and shrinking population are among the main concerns raised. There are also concerns about taxes on the working young. And a lot of concerns from businesses, especially from small businesses, about whether they have to close down or reduce their activities because of a shortage of workers.

Going back to the audience poll, I think some of the concerns are certainly very valid ones. For example, affordability of homes, because we attach a great deal of importance to home ownership in Singapore. As an immigrant society, home ownership gives us a sense of rootedness and belongingness, so home ownership is a very important social policy in Singapore.

Another concern is about feeling like a stranger in Singapore when there are so many foreigners around. Some of you are probably thinking “Will this be a Singapore that I am comfortable with?”

And jobs are a very important concern too. In fact, when I spoke at a seminar for JC and polytechnic students earlier this year, we polled the young people on what they were concerned about. I thought that being younger and idealistic, they would have a wider set of concerns, but the most important issue for them turned out to be jobs. I thought that was a very down-to-earth and realistic approach to life.

D. Marriage and Parenthood

Some of these concerns arise from whether we will have enough Singaporeans, just to replace ourselves. Our first priority is to build as strong a Singaporean core as we possibly can by encouraging more Singaporeans to get married and have more children, and at an earlier age.

There are some positive signs. Our surveys show that 85% of singles want to get married and 8 in 10 married couples want to have two to three children. In fact, I was in the Treasury building this morning, having a meeting and one of the staff brought her newborn baby in. So I asked her, “Is this your first?”, and she replied, “No, this is my third.” I am seeing more people with three children and more. I see that as a positive sign. We want to do our best to create an environment that supports Singaporeans to fulfill this desire. In fact, since 1987, we have encouraged Singaporeans to have 3, or more children.

Since 2001, we have redoubled our efforts, and put in place a comprehensive Marriage & Parenthood Package. These measures were enhanced again in 2004 and 2008, and again, we are currently studying further enhancements.

We are considering various measures and it would be useful to have a sense from you on which of these measures you feel will make the biggest difference to encourage more Singaporeans to get married and have children earlier? Maybe I can ask you this question now:

Polling Question 2: Which of these will make the biggest difference to encourage more Singaporeans to get married and have children earlier?

  • Finding the right partner
  • Owning a home
  • More financial help e.g. Baby Bonus and tax reliefs
  • Better childcare options
  • Better work-life balance
  • Family-friendly culture in society
tfr-1975-2011

It is interesting that work-life balance and family-friendly culture in society together account for more than 60 percent of the audience poll. Finding the right partner ranks high too. This shows that people want more time and a more family-friendly society. While financial concerns such as owning a home and better child care are important issues, work-life balance, family-friendly culture, and finding the right partner are soft issues. You have said that these are more important to starting a family and having children. And that is my sense too, because starting a family and having children is a personal decision. And if you decide that is something which is important to you, which you want to do and which brings fulfilment and satisfaction in your life, then all the other things matter less. But if you are not so sure that is you want, then all the other things become very good excuses not to proceed. So I am actually quite heartened to see this. I hope all the employers who are here today can have a look at the issue of better work-life balance, and see what you can do to help us to boost our marriage and parenthood rates.

Now let’s see how that compares to the feedback that we have been receiving through NPTD over the last six/seven months.

tfr-1975-2011

Work-life balance and societal mindsets have come up quite regularly. The cost of raising children is also a very big concern. In many ways, your feedback this evening helps to reaffirm some of the feedback that we have been getting directly from various people we have spoken to and who have sent in their views.

We will strive to create a supportive and conducive environment for raising children, and we hope that couples will make the decision to start a family, even if circumstances do not quite fit their expectations completely or perfectly.

With all of us doing our part, I hope our birth rate can increase to at least 1.4 or 1.5. It was not so long ago that our birth rate was around 1.4 to 1.5, in the late 1990s and the early 2000s. Of course, it would be very good if our birth rate was higher than 1.5, but I think it will take time to change this, and we will need a huge effort from everyone. I hope that one day we will get there.

tfr-1975-2011

E. Immigration

Now let us take a look at the citizen numbers again. The red line shows where our population will stabilise or plateau off if we were to just sustain our population at the TFR replacement rate of 2.1.

tfr-1975-2011

Even though we have been encouraging more Singaporeans to marry and have children, we have actually been falling short of the numbers to replace ourselves. We need approximately an additional 20,000 new Singaporeans per year, to keep our citizen population going from the blue line to the red line. The top-most line is if we have 25,000 more a year; the second dotted line is if we have 20,000 a year; and the third dotted line is if we have 15,000 a year. So we are somewhere in that band, and that is where we will be to maintain a population which is stable — not declining and also not growing at an uncontrollable rate.

tfr-1975-2011

Who are these new Singaporeans? A good number are spouses of Singaporeans. This is not surprising, given that nearly 40% of marriages last year, or about 9,000 of the 22,000 marriages, were between a Singaporean and a non-Singaporean.

Most of the other new citizens are adults in their prime working years and their families, and we select those who are able to contribute to Singapore, and can integrate into our society.

So, with 20,000 new citizens per year, what we are essentially doing is trying to ‘fill’ this shortfall.

tfr-1975-2011

Today, our population structure looks like a barrel. And if we project forward without immigration, in 2050, in 40 years’ time, we will become an inverted triangle — with many more older people above the age of 50 and very much fewer young Singaporeans.

And so what is it that we are trying to do with immigration? It is to fill in those parts in the younger age groups so that our population structure will look more like a cylinder or a rectangle. Otherwise, we will become more like an inverted triangle, and become quite unstable. So what we are trying to do is to have a more stable and sustainable population.

tfr-1975-2011

Besides Singapore Citizens, we also have 530,000 Permanent Residents today. These are people whom we assess can make a long term contribution to Singapore, but either they are not yet ready themselves to become Singapore citizens, or we are not yet ready to have them become Singapore citizens. We have been taking in about 30,000 PRs per year in the last two years, compared to about twice that number in the four to five years prior to that. So our permanent resident numbers have in fact, stabilised, and in the last two years, the numbers have decreased very slightly.

F. Non-Resident Population

What about our non-resident population? We have about 1.5 million non residents in total, and this is the composition.

tfr-1975-2011

There are 220,000 Dependants of citizens, these are spouses of Singaporeans, children of Singaporeans and some of our higher end work pass holders. We also have international students, where the numbers have come down from about 100,000 in 2008 to about 84,000.

In July this year, We also have foreign domestic workers — about 210,000 of them. They help us in a variety of ways, including looking after the elderly and doing domestic chores, so that both spouses can go out to work.

We have about 680,000 work permit holders. Most of them are doing work which either Singaporeans are not keen to do, or where there are not enough Singaporeans to do. Out of these 680,000, 280,000 are construction workers. We also have cleansing workers, some in the marine industries, and manufacturing. The vast majority of 1.5 million non-residents are foreign domestic workers and work permit workers.

And then we have the PMETs — professional, managerial and executives who are Employment Pass holders. They number about 170,000. There are also about 130,000 associate professionals. This group has been growing quite quickly, and we are trying to see how we can manage this growth.

Some people have asked, why do we need so many foreigners working in Singapore? They make Singapore more crowded. Why can’t we let Singaporeans have these jobs instead?

G. Creating Jobs for a Vibrant Singapore

Singaporeans are highly aspirational. We want good jobs for ourselves and particularly for our children. We asked people what types of jobs and career aspirations they have. We received different responses such as a having wide range of career opportunities, attractive salaries and work-life balance and a sense of purpose. So Singaporeans want exciting, interesting, well-paying jobs. Our universities, polytechnics and ITEs are trying to train as many Singaporeans as possible for jobs like these. But we need to bring in new growth areas and new exciting industrial sectors to create such jobs. Sometimes, you do not have enough Singaporeans to create enough of a critical mass in these new industries for a start.

One example is the biomedical science industry. 10 years ago, in 2001, 1 in 5 of the professional managerial executive positions in the biomedical sciences industry were held by locals. But the proportion has grown over the last ten years because we have been encouraging this very exciting new growth industry to take root in Singapore and grow, and provide many more jobs for Singaporeans. So what has happened is that this proportion has now increased to one in three, and in a much larger sector too. And in these last 10 years, 2,000 new PME jobs for locals were created in this sector. We could not have kick-started this sector without bringing in people to help create the critical mass to get the sector growing. Over time, the sector expands and provides more opportunities, as we train more Singaporeans to take up these jobs.

While Singapore is still an attractive business location, we do face competition from many emerging cities, and this competition is for the types of companies and jobs that Singaporeans want. I co-chair the Singapore-China Joint Council for Bilateral Cooperation. When I visit some of the cities there, they are very exciting and vibrant. What they are looking for in terms of investments in jobs and industries, is very often what we are looking for. Cities like Tianjin, Suzhou or Shanghai are moving very fast, and they are very hungry. If we have a shrinking and ageing population, it will be much more difficult for us to bring in exciting new industries, to attract new investments. Singapore will become a much less dynamic and vibrant place, and our young people who want to work in such growth industries may then go off to Tianjin or Mumbai or elsewhere. That would make our population problem even worse.

H. Foreign Manpower Projections

Unlike our resident population of citizens and PRs for which we want long-term stability, our foreign workforce is a transient one. Whenever we make a decision about citizens or PRs, it is like entering into a marriage. They have made a commitment to us, and we have made a commitment to them for the long-term.

The foreign workforce, however, is transient. It can adjust, grow, or shrink according to our needs for our whole economy, and for specific economic sectors. This gives us a lot of flexibility, and is one reason why we have been able to maintain relatively low unemployment, through the economic cycles, even in periods where we faced an economic downturn.

But we cannot grow our foreign workforce indefinitely. In fact, we have already started to tighten the access to foreign workers to slow down the growth of the foreign workforce.

In the first 6 months of this year, the growth in foreign manpower (excluding foreign domestic workers) slowed to 34,100, compared to 36,800 in the first half of last year. Let’s take a closer look at the figures.

tfr-1975-2011

15,500 of the growth for the first half of this year has been in construction. This is three times the growth in the first half of last year. We need construction workers to build HDB homes and MRT lines. And not many Singaporeans want to be in the construction industry. The other sectors would have seen the growth in total foreign workforce slow down quite seriously — from 31,000 to 18,600.

We already know from surveys that 8 in 10 small and medium enterprises (SMEs) are facing manpower shortages, and 3 in 10 are looking to relocate overseas to stay viable. Now this is a serious matter because our SMEs employ 70% of our workforce, and we have to be mindful that many of the SME workers are Singaporeans too. These Singaporeans will lose their jobs if our SMEs move abroad, or close down. So we have to make these adjustments in a calibrated way to make sure the huge efforts we are putting into productivity can have the time to take place.

We also live in an increasingly volatile world. In the last 15 years we have seen 5 down-cycles — the Asian Financial Crisis in 1997, September 11, 2001, SARS in 2003, the Lehman crisis in 2007-2008, and now the Eurozone crisis. In those years when growth is strong, we should seize the opportunities that come our way. In such times, we may allow more foreign workers to come in to supplement our workforce. Such periods will help make up for years of slow or even negative growth when we expect the demand for foreign workforce to moderate or fall. But I think the overall growth target of 3 to 5 percent annual growth set out by the Economic Strategies Committee up to 2020 is a reasonable growth rate, if we can even achieve that.

I. How Many People can We Have in Singapore?

Many people have also asked, “We are so crowded already — how many people can we take on our small island?”

Singapore feels crowded today because population growth surged ahead of our infrastructure, transport and housing as our economy rebounded rapidly in the last few years. We have been working hard to catch up — which also explains the increase in construction workers for now. We will open a new rail section every year until 2017, and double the rail network over the next ten years. We are also expanding the bus fleet by 20% with an additional 800 buses over the next five years. HDB has launched 50,000 Build-To-Order flats in the past 2 years, and will offer 20,000 more next year. We will also have more nursing homes and hospitals. Not all these improvements can come on-stream immediately, but they will become available progressively over the coming years, including many in the next three to five years.

tfr-1975-2011

How many people we can have in Singapore depends on many factors, including how well we plan our urban environment as well as the technology solutions that will be available to us. If you look at Pinnacle@Duxton, many people want to live there, even though the population density is very high. People want to live there because it is convenient and the environment is nice, with amenities close by. So it is a matter of planning well, and ensuring sufficient infrastructure and facilities.

URA, in their most recent midterm concept plan review in 2006, assessed that Singapore has sufficient land to support a population of 6.5 million. During the course of our consultation over the last half year, several experts have commented that there is room for growth beyond that number, and we are going to seriously study this, because that is the responsible thing to do.

Let me stress that these are planning parameters for infrastructure and land planning, and not a population target. It does not mean that Singapore will go for a population of that size. The problem is that without proper planning, there will be crowding leading to a poorer living environment. So it is better to plan early, so that Singapore can continue to be developed in a well-planned way with good living environment.

J. Singapore: Our Home, A Global City

One of the big concerns we have heard is: “Will I feel like a stranger in Singapore?” Singapore has always been an immigrant society. If you look back to the roots of your own family, you do not have to go back very far to find somebody who came to Singapore from elsewhere and decided to sink roots here. Our diversity has been a huge strength for Singapore, but also meant that we need to put in additional effort to build national cohesion. Because of this diversity, Singaporeans understand the region better than most. We have an understanding and experience of different cultures, languages and people. This is a strength for Singaporeans. We can be quite comfortable living anywhere in the world. And this ability to transit from culture to culture will be a key attribute for any exciting, growing city in the future.

The structure of our population has also been evolving. We now have more Singaporeans living and working overseas, even as we have more foreigners living and working in Singapore. More Singaporeans are marrying foreigners — making up 40% of marriages. More Singaporean children will have fathers or mothers who were not born in Singapore.

We are united, not just by where we are born, but by the values we live by and a common desire to want to make Singapore, our home, better.

From the feedback we have received so far, I am happy to know that so many Singaporeans care about where our country is going, and how our population will evolve over time.

I look forward to hearing more of your views and suggestions. All the views and suggestions we receive will help us to shape our population planning, culminating in the White Paper on a sustainable population later this year.

Thank you.