14 hours ago

Tan Jee Say 陳如斯

[A tribute to the late Mr Ngiam Tong Dow, boss, mentor, friend.]

How PM Lee can achieve his vision of “a fairer, ever more just and equal society” by learning from Ngiam Tong Dow’s unfulfilled ideals for Singapore

Summary of Key Points

1 Lee Hsien Loong’s legacy: a typical Third World economic structure of huge economic inequalities with an elite class of crony capitalists (as defined by The Economist), millionaire ministers, civil servants and managers of GLCs on the one hand and on the other, a large low wage workforce with one third of children going to school without breakfast.
2 PM Lee’s grave mistake was in not choosing better advisers. He repeated his poor judgement of people in his choice of 4G ministers whose absolute incompetence was laid bare to the entire world with their mishandling of the COVID-19 situation.
3 What can PM Lee do now to prevent further damage to Singapore? His first choice is to replace his 4G ministers but unfortunately there are no ministers of proven ability to draw upon. The next best option is to sidestep them, keeping them as ministers in name only but working directly with civil servants in the ministries. In this, he can take a leaf from founding PM LKY who treated ministers as grassroots managers sent out to win public support for issues already discussed and decided upon with civil servants like Sim Kee Boon, JYM Pillay and Ngiam.
4 Should PM Lee go down to this level of detail? In normal circumstances, he does not need to do so. But when the leadership is ‘broken’ as demonstrated by the 4G ministers in COVID-19, and when the system is ‘rotten’ as shown in the Liew Mun Leong vs Parti case, it is time for PM Lee to intervene and act to establish command and restore confidence.
5 It is not disastrous to change ministers amid COVID-19 and a severe economic recession. The example of Abraham Lincoln’s and Xi Jinping’s leadership should inspire PM Lee. The 16th US President was losing the Civil War but turned it around after he replaced his generals and took direct charge, winning key battles and thereby preserving the Union of America. More currently, Chinese President Xi Jinping also replaced the officials in Wuhan for mishandling the coronavirus epidemic and won the fight against COVID-19 early and ahead of most, if not all. PM Lee, like Lincoln and Xi, should not be afraid of changing horses in mid-stream.
6 Leadership succession should be set aside until PM Lee has fully put the economy back on a sound footing. In these transformational times brought about by COVID-19, he needs the full term of five years to restructure the economy so that it can adequately support his vision of “a fairer, ever more just and equal society” that he stated in Parliament recently.
7 To achieve his vision, PM Lee has to turn Singapore into a modern advanced economy of the First World with high paying jobs and a Gini coefficient of below 0.3, in line with the OECD average of 0.29 (Denmark, Finland and Norway are more equal at around 0.25 each).
Singapore can get there in two stages:
Firstly, reintroduce the high wage policy proposed by Ngiam 40 years ago. High wages will force the pace of economic upgrading and lead to high quality jobs for our people.
Secondly, make full use of the return on our national reserves to increase state subsidies in essential welfare services, particularly healthcare and education.
8 When founding PM LKY proudly proclaimed that he had turned Singapore from Third World to First, he was only half correct. Singapore was only First World in terms of GDP per capita and modern physical infrastructure. With a Gini coefficient of above 0.4, we were still way behind others in fairness, justice and equality. We are still behind even now. But thanks to the sacrifices of earlier generations of Singaporeans, we now have the means namely education, skills and financial reserves, to achieve “a fairer, ever more just and equal society” within our lifetime.
Does PM Lee have the “iron” in him to get the right people to help him achieve his vision and complete the journey to First World that founding PM LKY set out for Singapore?

The Essay in Full

In the one month that Ngiam Tong Dow passed away on 20 August 2020, two issues close to his heart, have captured the national consciousness namely, foreign workers and governance issues arising from the Liew Mun Leong vs Parti case. Ngiam had dealt with these and many other issues during his entire career of over 40 years in top positions in the civil service. Had his advice and concerns on these two specific issues been acted upon, Singapore would have avoided the problems that now trouble us. Let me explain.

Rotten system
First the governance issues. The Parti case “reveals a rotten system” as The Economist put it (19 September 2020). It went on: “The case should have been thrown out. The police investigation was botched. The accuser’s testimony was riddled with inconsistencies. But….Parti Liyani, an Indonesian maid accused by her Singaporean employer of attempted theft, was convicted and sentenced to 26 months in jail.” However on appeal to the High Court, “she was acquitted by Justice Chan Seng Onn, whose ruling declared her employer’s motive for filing charges ‘improper’………The trial judge disregarded (such) irregularities……….and that the prosecution ‘failed to dispel the reasonable doubt raised by the defence’, who argued that the Liews framed Ms Liyani….”

Mr Liew is ‘a powerful figure in business who, among other things, was chairman of the state-owned Changi Airport Group.’ He was only very recently praised publicly and just before Justice Chan’s judgement was announced, as a “builder of people” by Ho Ching, the CEO of state-owned Temasek Holdings and wife of the prime minister.

How has our public service, much lauded for its integrity, reached such a “rotten” state? Ngiam had this to say of the public service in 2013:”…..it started going downhill when we started to raise ministers’ salaries…. When you raise ministers’ salaries to the point that they’re earning millions of dollars, every minister – no matter how much he wants to turn up and tell Hsien Loong off or whatever – will hesitate when he thinks of his million-dollar salary. Even if he wants to do it, his wife will stop him.”

Elite Cronies
A few of the ministers might have felt uneasy even embarassed initially but they quickly “psycho” themselves into believing that they are exceptional persons of integrity and competence, hence deserving of the exceptionally high salaries. A culture of entitlement soon developed and was shamelessly extended to other parts of the public service and government-linked companies (GLCs). An elite class defined by money evolved. Many top civil servants sit on the boards of GLCs, suggesting a friendly relationship with business. How entrenched and extensive has this relationship become? What has prompted the Economist Intelligence Unit to rank Singapore as top 4 in its Global Crony Capitalism Index, after Ukraine, Malaysia and Russia?

An elite class is bad for Singapore. “It is when any group feels it is superior and has a special place that problems occur.” (Han Fook Kwang, Sunday Times, 20 September 2020). He also wrote, “People at the top, whether in Government or business, have more connections with one another, and move in the same social circles and can easily open doors for one another.” The resulting culture of entitlement has been laid bare in the Parti case. To prevent further damage to Singapore, this elite class must be dismantled and PM can start by substantially reducing the salaries of ministers, top civil servants and executives in GLCs, and removing the cosy relationship between government and business.

Foreign workers
The issue of too many foreign workers (a term that shall hereafter include PMETs) is not new. It was the persistence of this problem in the late 1970s that compelled the government to move away from low-wage labour-intensive industries and into high-wage high-productivity ones.

The centre-piece of this new economic strategy to upgrade industries was a wage-correction policy to compel employers to make productive use of labour through wage increases of 20% per annum for 3 years. It was proposed by Ngiam working together with Dr Albert Winsemius, the economic adviser to the government. Both told me that PM LKY readily accepted their high wage proposal because it fit with his socialist beliefs of improving the lot of workers.

The new strategy was fleshed out in a 10-year economic plan by a working team of young economists led by Ng Kiat Chong as director. I was a late member of the team. We met regularly with Ngiam for dinner conversations over national issues, even after we had left the service. We had happy times together as shown by the two photographs below.

Unfortunately, the strategy was not fully followed through and was soft-pedalled when recession hit Singapore in 1985. Ngiam lost direct influence over economic policy when he was moved out of the Ministry of Trade and Industry after LHL became MTI minister and brought in new advisers from other ministries.

New brooms
What did the new brooms sweep in? What did it tell us about the state of the economy and the quality of his advisors when after 20 years as minister for trade and industry and then for finance, PM Lee decided to bring in two casinos to boost the economy? He also opened the doors to a huge inflow of about one million low wage, low skilled and low productivity foreign workers in 10 years, contrary to the strategy of a high wage, high skilled and high productivity economy that Ngiam proposed and Goh Chok Tong promoted as Minister for Trade and Industry in 1979.

LHL’s Legacy
Today, Singapore is saddled with a typical Third World economic structure of huge economic inequalities with an elite class of crony capitalists (as defined by The Economist), millionaire ministers, civil servants and managers of GLCs on the one hand and on the other, a large low wage workforce with one third of children going to school without breakfast.

This is not a legacy that LHL can be proud of after 16 years as PM. PM Lee’s grave mistake was in not choosing better advisers. He repeated his poor judgement of people in his choice of 4G ministers whose absolute incompetence was laid bare to the entire world with their mishandling of the COVID-19 situation when it first struck Singapore, this despite claiming experience in handling SARS 17 years earlier. They have done great harm to Singapore’s international reputation that has been painstakingly built up by previous and current generations. They have also incurred huge costs of nearly $100 billion in aid packages without knowing if or how they would be effective.

PM’s options
What can PM Lee do now to prevent further damage to Singapore? His first choice is to replace his 4G ministers but unfortunately there are no ministers of proven ability to draw upon. The next best option is to sidestep them, keeping them as ministers in name only but working directly with civil servants in the ministries. In this, he can take a leaf from founding PM LKY who treated ministers as grassroots managers sent out to win public support for issues already discussed and decided upon with civil servants like Sim Kee Boon, JYM Pillay and Ngiam.

Remember the policies on retirement age, withdrawal of CPF funds, minimum sum, CPF annuity, Medisave etc that Goh Chok Tong had to “sell”? I recall my personal experiences when PM LKY told the late Health Minister Howe Yoon Chong who was Chairman of the Committee on the Problems of the Aged, to get me to rewrite the Committee’s report (with key recommendations on retirement age, CPF withdrawal and annuity scheme that GCT later promoted), and his instruction to Ngiam to get me to restore the Employment Pass criteria after initial changes were made. I still remember Ngiam’s exact words to me: “Do what PM (LKY) wants or else he will come down on us like a ton of bricks.”

Rolling Up His Sleeves
As a young officer, I was amazed with PM LKY’s grasp of detail and his ability to identify the relevant junior officer to do the job, bypassing the ministers. Should PM Lee go down to this level of detail? In normal circumstances, he does not need to do so. But when the leadership is ‘broken’ as demonstrated by the 4G ministers in COVID-19, and when the system is ‘rotten’ as shown in the Parti case, it is time for PM Lee to intervene and act to establish command and restore confidence.

The Abraham Lincoln & Xi Jinping Way
Would it be disastrous to change ministers amid COVID-19 and a severe economic recession? No, it would not be. The example of Abraham Lincoln’s and Xi Jinping’s leadership should inspire PM Lee.

The 16th US President was losing the Civil War when he decided to
replace his generals and take direct charge of the war campaign. He subsequently secured victories in key battles and won the war, thereby preserving the Union of America. More currently, Chinese President Xi Jinping took quick, decisive action in February this year and replaced local officials in Wuhan for their initial cover-up and failure to prepare residents to contain the coronavirus. Because of his early intervention, China has won the fight against COVID-19 ahead of most, if not all. PM Lee, like Lincoln and Xi, should not be afraid of changing horses in mid-stream.

What does this mean for the planned leadership succession? It should be set aside until PM Lee has fully put the economy back on a sound footing. It would be premature for him to hand over the baton in the middle of his 5-year term of office as he had earlier desired. In these transformational times brought about by COVID-19, he needs the full term to restructure the economy so that it can adequately support his vision of “a fairer, ever more just and equal society” that he stated in Parliament recently.

“Fairer, more just and equal”
To achieve his vision, PM Lee has to turn Singapore into a modern advanced economy of the First World with high paying jobs and a Gini coefficient of below 0.3, in line with the OECD average of 0.29 (Denmark, Finland and Norway are more equal at around 0.25 each).

Singapore can get there in two stages:

Firstly, reintroduce the high wage policy proposed by Ngiam 40 years ago and implemented for 3 years but was unfortunately soft-pedalled in subsequent years and negated by the liberal inflow of foreign workers.

High wages will force the pace of economic upgrading and lead to high quality jobs for our people. There will inevitably be resistance from employers but PM Lee must be steadfast and unswerving in his commitment, always keeping his longer term vision in mind.

Secondly, make full use of the return on our national reserves to increase state subsidies in essential welfare services, particularly healthcare and education.

Healthcare costs are currently subsidized about half, increasing it to full subsidy requires about an additional $5 to $6 billion per annum which we can easily afford from the return on our reserves without touching the principal sum. It is similar for education which requires only about $1 billion per annum to waive all fees up to university level so that families will not be burdened with huge student loans. Even after providing full subsidies for healthcare and education, there will still be substantial balances from the return on our reserves for other welfare services such as monthly cash grants for the elderly and young children to help families cope with the high costs of living in a First World society. Details of my proposals are available in my economic plan “Take Back Our Money, Be True First World” at www.tanjeesay.sg

Completing the Journey to First World
When founding PM LKY proudly proclaimed that he had turned Singapore from Third World to First, he was only half correct. Singapore was only First World in terms of GDP per capita and modern physical infrastructure. With a Gini coefficient of above 0.4, we were still way behind others in fairness, justice and equality. We are still behind even now. But thanks to the sacrifices of earlier generations of Singaporeans, we now have the means namely education, skills and financial reserves, to achieve PM Lee’s vision of “a fairer, ever more just and equal society” within our lifetime.

Does PM Lee have the “iron” in him to get the right people to help him achieve his vision and complete the journey to First World that founding PM LKY set out for Singapore ?
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