Singapore casts a cold eye on future

PUBLISHED : Tuesday, 11 January, 1994, 12:00am
UPDATED : Tuesday, 11 January, 1994, 12:00am

SINGAPOREANS were told last night that while their country was prospering now, they must prepare for a future in which an ageing population would face tougher international competition.


Opening Singapore's first session of Parliament for 1994, President Ong Teng Cheong said Singaporeans were enjoying better health and living longer, but birth rates remained low and the population was ageing.


''These fundamental demographic changes have serious social and economic implications,'' he said.


''We must adjust our policies to prepare for them.'' As part of that adjustment, Singaporeans will be required to make larger contributions to the Central Provident Fund (CPF), the country's national superannuation scheme.


The Head of State's speech, outlining the Government's programme and direction in accordance with the Westminster tradition inherited by this former British colony, forecast further steady economic progress in the next few years.


The Prime Minister, Goh Chok Tong, earlier this month reported a buoyant growth of 9.8 per cent in 1993 and predicted that the economy would grow by six to eight per cent this year.


Mr Ong said that since short-term issues were well in hand, the Government's focus was on long-term policies to position Singapore ''for the next stage of nation-building''.


''In economics, one major thrust is to venture abroad, to develop trade and investment links with neighbouring countries and tap the vitality and opportunities in a fast-growing region,'' he said.


''We will promote a regional outlook among Singaporeans and remove obstacles that hinder our entrepreneurs and companies from going offshore. Our advantage is that we are familiar with East and West, with the region as well as the developed countries.


''By investing in the larger economies around us, we can link our prosperity with their dynamism.'' Mr Ong said that at the same time Singapore must upgrade its domestic economy to avoid losing business to other countries with lower costs and more abundant resources.


He said the longer life spans of Singaporeans meant that people needed to stay economically active longer and retire later.


Retraining programmes for older workers would be expanded to help them upgrade and adapt to new technology.


Noting that the retirement age had been raised to 60, he said it would be raised further, and eventually to 67.


Mr Ong said Singaporeans ''must put aside enough for their old age''. The minimum contribution to the CPF would be raised gradually over a number of years and while older workers would only need to make small adjustments younger workers must start to make the full adjustment now.


''The Government will discuss the issue thoroughly over the next few months and then decide on the best way to proceed,'' he said.


Mr Ong said wherever possible Singapore's welfare schemes depended on self-reliance and savings and not just on government taxation and direct transfers of income.


Referring to the ''disastrous side effects of state welfare'' in Europe, Australia, New Zealand and Canada, he said Singapore ''must stay with what has worked and not follow the mistakes of others''.


 

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