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  • Singapore’s Population ConundrumThe Great Balancing Act 2
  • Yap Mui Teng (bio)

In January 2013, the Singapore government is expected to issue a White Paper on Population which will be debated in Parliament. This is the culmination of a year’s work and consultations involving various stakeholders. At issue are the ultra-low Total Fertility Rate (TFR), imminent rapid population and workforce ageing and decline, and the population’s aversion to more in-migration, a policy lever which could ameliorate the above mentioned impacts. The White Paper represents another attempt by the government to come to grips with Singapore’s population conundrum.

What Is at Stake?

Singapore’s population has been experiencing below replacement level TFR since 1977. Since 2003, the TFR has in fact fallen below the “ultra-low”1 level of 1.3 births per woman. According to the eminent demographer, Peter McDonald, no country whose TFR has fallen below 1.5 births per woman has successfully returned to the replacement level of about 2.1.2 The National Population and Talent Division (NPTD), which is a part of the Prime Minister’s Office, projected that with a constant TFR of 1.2 births and average life expectancy of eighty-two years, the number of deaths among its citizens will outstrip births by 2025 and the citizen population will begin to decline, if there is no net in-migration.3 The NPTD goes on to show that raising the TFR to the replacement level will only delay and slow the rate of decline and that an [End Page 274] annual inflow of between 20,000 and 25,000 immigrants “will keep the citizen population size stable”.4

Another factor that will begin to change the demographic scene dramatically in Singapore is the ageing of the post-World War II baby boomers. According to the NPTD:

(b)etween now and 2030, Singapore will experience an unprecedented age shift, as over 900,000 Baby Boomers will retire from the workforce and enter their silver years … As more citizens retire and fewer enter the working-age band of 20–64 years, the number of citizens of working ages will start to shrink. At current TFR and without immigration, the size of our working-age citizen population will shrink drastically … Immigration will slow down the decline of citizens in the working-age band. An inflow of 25 (thousand) new citizens per year would keep the size of our working-age citizen population relatively stable.5

In another paper put out as part of its public consultation exercise, the NPTD spells out the implications of population ageing and decline for Singapore, as follows:

An ageing population coupled with increased longevity will lead to higher national healthcare and long-term care expenditure for the elderly. Even at current rates of subsidy, the national expenditure on healthcare will rise, given that there will be (three) times the number of citizens aged 65 and above by 2030. With fewer children to support parents and grandparents, and increasing numbers of elderly living alone, more paid help such as domestic workers, home-based caregivers and nurses will also be needed.

Government revenue comes mostly from income taxes, consumption taxes and asset taxes, all of which are dependent on economic growth. A shrinking and ageing population and workforce will make it more difficult to sustain public finances, especially when this is coupled with increasing needs for higher expenditure to support a much larger elderly population. We may need to cut expenditure in some areas, or find new sources of revenue to balance our budget.6

Why Now?

As mentioned in the NPTD paper, 2012 marks the year when the first of the baby boomers, identified in Singapore as those born over the years 1947 to 1964, reach age sixty-five, marking their entry into retirement and senior citizen status.7 [End Page 275] Although baby boomers, particularly the later-born ones, are better educated and likely to be better prepared for old age than the current elderly, the ratio between economically active and inactive population will change unless measures are taken to change existing attitudes and institutions to adapt to the new reality. These include changes in attitudes...

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