Debate on President's Address

Mdm Speaker, I rise in support of the Motion.

We all want the same thing – to "Secure Our Future Together". That was the title of our PAP manifesto in 2011 and it stated my Government's goal. To develop a "fair and inclusive society, where every citizen has a rightful place and the opportunity to fulfil his or her aspirations".

We set out our plans clearly in the manifesto, for example, to develop a vibrant city and an endearing home; by providing high-quality and affordable HDB homes, and enhancing our public transport system; by improving the lives of lower-income Singaporeans, for example, by helping them own their own homes.

We have made steady progress on these programmes over the last three years. We stabilised the housing market. We have cleared the first-timer queues. We have introduced the Bus Service Enhancement Programme (BSEP) for commuters while we expand the rail network. We took prudent steps to manage our population, particularly the inflow and the profile of foreign workers. And we have strengthened social safety nets and balanced economic growth with social priorities.

So, today, I intend to recap our progress in each of these areas, before talking about our agenda for the rest of this term as it has been set out in the President's Address.

Let me start with housing. When Parliament first opened in 2011, this was a big concern for Singaporeans. So, the Government mobilised all our resources to tackle this problem. In the last three years, we have built two Clementi new towns worth of HDB flats – 52,000 flats. And we have almost doubled the subsidies for the flats which have been disbursed, so as to make the flats more affordable. And the situation is now under control, as many Members have acknowledged. Mr Zainudin Nordin spoke about this, so did Mr Edwin Tong and Mr Gan Thiam Poh. I think Minister Khaw Boon Wan, MND and HDB have done a good job, both the political leaders and also the civil servants.

I know that Singaporeans are still focused on housing. On May Day after the Rally, I met a group of Pioneer Generation unionists. We had a very good chat. They were very happy to be honoured by NTUC and they greatly appreciated the Pioneer Generation Package. So, we

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reminisced about life in their generation. They are only a few years older than me. And we got talking about the cost of property. I said, "Well, in those days, a 3-room flat cost $8,000". Two of them said, "No, I only paid $6,800 for my 3-room flat." Today, that 3-room flat is worth probably more than $300,000. But, of course, in those days salaries were much lower. So, I said, "What was your salary then?" He laughed, and said, "I knew you would ask me that question." He was paid – as a teacher – $300. And for that princely sum, he started paying for an HDB flat. But as Singapore prospered and the value of their flats rose, they shared in this benefit and today they have sizeable nest-eggs in their retirement.

But they said their children were concerned about housing still being expensive. So, I explained, what I have explained so many times before, how we are keeping flats affordable for their children's generation as well. Because HDB home ownership is not just about providing Singaporeans a roof over our heads, it is also to give everyone a stake in the country.

It is a very important way by which we boost the assets of the lower-income Singaporeans, level them up, and narrow the gap between the rich and the poor in Singapore. That is why we have very generous grants to help the low-income, and even middle-income households, to buy HDB flats. For example, if a $1,000 monthly income household is buying a 2-room flat, the grants can come up to two-thirds the value of the 2-room flat, $60,000-$70,000. These are very significant subsidies, several years of wages, to help the lower-income own their flats, build their nest-eggs, especially be ready for retirement. That is the fundamental reason why we will always be keeping housing affordable for Singaporeans.

So, I explained all these. I asked them, "How are your children managing? How many children have you got?", "Seven – six married, one staying with me." I said, "Have they got houses?" He said, "Yes, they all have houses." I asked, "Affordable? " The reply, "Well, they all afforded it but, still, you know, lah."

So, we have to continue to explain to get the message across, and to make people understand how unique and special this position is, where for $1,000 income, you can start to buy an HDB flat and have a substantial nest-egg for your retirement with the help of this Government. So, we have made progress on housing.

We are also making progress on public transport. The BSEP has been rolled out aggressively, even faster than what we originally aimed to do. I know my residents are very happy with the extra bus services we have, and other Members of Parliament have received similar feedback from their residents. And I am not surprised that many Members of Parliament are now asking for more BSEP bus routes. And more buses and more routes will

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come.

For trains, it is still work-in-progress. SMRT and Land Transport Authority (LTA) have been working hard to improve services and reduce disruptions. We have also introduced free early morning rides which have helped to spread out the peak hour traffic noticeably. But I know the trains are still crowded at peak hours.

We have major plans unfolding over the next two years. New trains are starting to come in, starting late this year; and more next year. We are upgrading the signalling equipment. It will be started by 2016. So, we can expect significant improvements in the train service by next year, and this is a problem which we can and we will solve.

Our aim is not just to have more buses and trains running, but to build a first-class public transport system in Singapore, so that people can get around comfortably, efficiently and affordably without needing to own a car. This is essential to us being a world-class city and an endearing home. You will see it in global cities like New York, Hong Kong and Sydney, where many people do not own cars, do not even have driving licences, because it is too expensive. The car itself may not be expensive but buying a parking lot can cost you a fortune, more than a COE cost in Singapore, and parking in town also is expensive and more than the ERP cost in Singapore. So, most people take public transport because it is affordable and efficient. Some also cycle, which is not only affordable, efficient, but also green, and it is something which, I think, we should also encourage in Singapore.

So, we should learn from the cities which have good public transport systems, for example, London. I was there recently for the Singapore Day, and so I decided to have a look at their bus transport system because LTA had been telling me about it. We have a Singapore company, ComfortDelGro, which is running a significant part of the bus service in London.

London runs a hybrid system. The government, that means Transport for London (TfL), owns, plans and regulates the whole bus system, the network. So, they own the buses, they plan the routes, they set the rules, they tender out routes to operators. The operators take over the equipment, take over the staff, they run the routes for a period. The operators are private sector and they operate on a fixed-price contract, full profit. The fares are not cheap: per trip is more than S$3, which is 1.5 to four times Singapore prices. And every year, the fares go up, more or less automatically, RPI + x; RPI, the price index plus x, which is 1%-2%, because wages go up more than general cost of food and consumables, so every year the prices go up.

But even then, it does not cover all the cost, and TfL has to subsidise the service heavily with taxpayers' money. Every year, almost S$1 billion. It works well, it is expensive but it

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works well. It is the result of many years of experimentation, trial and error, change and refinement, and adaptation both by the regulators as well as by the operators, as well as by the commuters. So, we will learn from London and other similar cities to build a first-class public transport system in Singapore.

Running a world-class system means investing more resources. Mr Gerald Ee, in The Sunday Times last week, put it very sharply – you pay for what you get. If you want a better quality service, you have to pay more. And one way or the other, the cost comes from the people either in fares or in subsidies, which means taxes.

We have spent, as a Government, large sums on public transport in Singapore – expanding the BSEP, building and upgrading the train network. We will continue to subsidise public transport so that it is viable even as we improve the frequency and expand the network. But commuters also have to pay their share because as Mr Gerard Ee said, "We want better service but no fare increase – which is not realistic." So, we have got to find the right balance in cost-sharing between the Government, the private sector and commuters.

A third major issue which has preoccupied us for these last few years has been population. We had a debate on the Population White Paper last year. It was vigorous and emotional. But it helped people to better understand the issues and the Government to work out our plans.

We are significantly reducing the inflow of new arrivals, both immigrants as well as foreign workers, making a clear transition in our economy and we will review our population planning parameters again in a few years' time nearer to 2020.

One major issue when we work out our population policy is how many foreign workers to allow in. We have slowed the inflow of foreign workers considerably from what it was in 2010/2011, but we did not freeze the numbers. The numbers are still growing but they are growing much more slowly.

The inflow of foreign workers per year has almost halved since 2011. And many of these are construction workers because we have the construction jobs. But if you exclude construction workers, for services, for manufacturing, the foreign workers are only growing one quarter as fast as they used to in 2011. So, it is a very significant tightening. And it is a tightening which has been very painful for our companies, especially the SMEs.

Many SMEs are struggling. Members of Parliament have spoken up for them in this House – Mr Teo Siong Seng and Mr Gan Thiam Poh – they spoke eloquently. Some of the SMEs have shifted their operations out of Singapore, perhaps to Malaysia. If we squeeze

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them too hard, they may not survive, and that will mean that many Singapore jobs will be at risk.

I attended the Singapore Malay Chamber of Commerce and Industry (SMCCI)'s Malay Muslim Business Conference several weeks ago and met quite a number of Malay SME operators and owners there – young people, ambitious people, people venturing into the region, wanting to do business, seeing the opportunities, unable to get the workers. They asked me to help. I said we will help all our companies, especially SMEs, adapt to an environment where there are fewer foreign workers.

We have many schemes to do that. We have the PIC and PIC+. These are productivity grants and many other schemes which Mr Teo Ser Luck told you about yesterday. But while we can help you to adapt to this environment, we are not able to ease up on the foreign worker limits, not just because people may or may not be unhappy about the numbers but because we have to maintain the numbers at a level which is sustainable and which we can physically accommodate in Singapore over the long term. So, I hope that they will understand this.

But I should say that when we had the debate, the Opposition proposed that we go for zero percent growth of foreign workers and maintain that this was a good thing and popular. It is a good thing we did not do that because if we had done that, many more SMEs would have been hurt and many more Singaporeans would have lost their jobs.

One group of foreign workers we are paying close attention to is the Foreign PMEs – the Professionals, Managers, Executives. The issue here is less about the numbers because the numbers are not huge but about the quality of foreign PMEs and also about fair treatment for Singaporean PMEs.

We have been managing their number and their profile, and tightening up on the standards expected of Employment Pass and S Pass holders, their salaries, their qualifications, their experience. We have been developing Singaporean PMEs, professionals. We have offered many Singapore industry scholarships so that we can develop them with a view to specific jobs and industries.

We are ensuring a level playing field through the Fair Consideration Framework, which Dr Amy Khor and Ms Foo Mee Har raised and which Mr Patrick Tay campaigned for, for a long time. So, we will continue to do more to give Singaporean PMEs every opportunity to succeed.

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There is another much bigger group of foreign workers which we are managing very carefully too and that is the construction workers. The numbers are much bigger; there are about 300,000 of them. The social impact is much bigger; we have a problem of congestion in Little India on weekends and you saw that we had one riot in December last year.

We have tightened up on construction workers too – raising the levies, reducing the quotas, insisting on higher productivity targets and more productive ways of building and constructing new houses and structures. But that is just managing the numbers of workers needed for doing their jobs. The jobs are there. So, we have asked ourselves: should we not go further and ask which are those jobs that need to be built urgently? The private sector – they make their decisions. The Government – we are a significant part of the construction business – we ask ourselves: which Government projects need to be built, which Government projects can be deferred? When it comes to HDB houses, when it comes to trains, projects which are urgent, we are going full steam ahead.

But there are other projects which can wait one or two years. We can defer them, we can study them a bit more, we can phase them out so that we can spread out the demand for construction workers and then you will be able to manage the total number of construction workers in Singapore.

No Ministry volunteers to put off any of their building projects but MOF is very persuasive. We have had very close discussions with the Ministries, with the Statutory Boards, some of which had new offices planned. We were going to build extensions to Gardens by the Bay on the other side – Marina East. We are planning to build a new Science Centre. We want to extend the Esplanade. These are all good projects but they will all now take a little bit longer to come. And altogether, you are talking about not a small sum – $2 billion worth of projects and we may save 20,000 to 30,000 foreign workers that way, which I think will be helpful. These are necessary trade-offs and I hope Singaporeans will understand.

I have been reviewing our progress in the first half of this term. But even as we tackle the immediate issues, we have to look to the future. There are exciting opportunities ahead: Asia is continuing to grow; ASEAN is establishing an ASEAN Community by the end of next year which should give us more opportunities in our neighbouring countries; we are venturing into new industries, new technologies; the globalisation is progressing, people talk about Big Data, we are part of that, we want to be a Smart City, a Smart Nation.

But as Mr Sitoh has just pointed out, at the same time, we are undergoing very rapid changes and there are widening inequalities. This is causing angst and restlessness. And not

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just in Singapore, but in many countries around the world.

Take, for example, China: developing, prospering, becoming middle income faster than any other country of that size and scale ever in the world. Yet, middle-income families in China feel the same angst as our middle income families do. They doubt that they can have better lives than their parents, even though their standard of living is already much higher. They worry what the future holds for them and they are unhappy that some others are doing much better than they themselves are. You would have heard the phrases, "官二代" or "富二代". That means second generation child of a high official or second generation child of a wealthy person. They are envied; everybody else says, "Where do I go?" Although, in fact, the tide is rising for everybody, but the anxiety, the angst is there, within China.

But China causes anxiety elsewhere. One country is Hong Kong. And the Chinese visit as tourists by the millions. Hong Kongers, the residents, protest bitterly against the influx of Mainlanders raising their costs of living, buying their milk powder. They had imposed quotas: per tourist, two cans of milk are all they are allowed to carry out at the border. So, the Hong Kongers are anxious – a different environment but some sort of anxiety.

We look for models around the world and we think of Bhutan. When we had the debate at the Opening of the First Session of this Parliament in 2011, Ms Sylvia Lim made a major point about Bhutan.

Bhutan was talking about Gross National Happiness (GNH) – not GNP, Gross National Product. And they had a fully worked out formula, structure, what do you study, what does happiness consist of. They have Jeffrey Sachs advising them and it was a whole system. But it was not so simple. Mr Khaw Boon Wan and some others on our side explained why it was not so simple.

At that time, the Bhutan government made Gross National Happiness a big part of their agenda. It is a pity that Ms Sylvia Lim did not mention Gross National Happiness when she spoke in the debate today. Because I am not sure whether she noticed – last year, there was a general election in Bhutan and the government which proposed Gross National Happiness was voted out!

The new government has come in and the new Prime Minister has been interviewed and had said that Gross National Happiness was "overused" and it "distracted (the government) from the real business at hand". And what is the real business at hand? He named four: tackling major problems with chronic unemployment, poverty, corruption and a sense that politicians were too remote.

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There is no magic formula which can cause us to solve these problems in a sense of suddenly waking up with no worries. We each confront our own different situations; we each have to manage in our own way and see our situation in perspective.

I am not disparaging the efforts of others at all. I am just pointing out that every country has its own challenges. We should not always believe that the grass is greener on the other side. Sometimes it is, sometimes it is not. Happiness is a state of mind. We can be better off, and yet, if we succumb to the urgings of those who promote envy, excite disaffection then we will always be unhappy. No amount of good things can make us happy. Happiness has to come from within ourselves.

Because Singaporeans experience the same global trends, so it is completely understandable that we too feel anxious and concerned. But there is much that we can and must do, to secure our future and give ourselves greater peace of mind. We will work hard to fulfil our vision of a "fair and inclusive society, where every citizen has a rightful place and the opportunity to fulfil his or her aspirations".

How will we do this? We should share the fruits of progress and strengthen our social safety nets. We should keep pathways upwards open to all. We should fire up the human spirit and, of course, we must get our politics right.

First of all, we should share the fruits of progress more widely and strengthen our social safety nets. That is how we build a fair and inclusive society that is the yin to complement the yang of self-reliance and competition which are also necessary. Indeed, this is something which we have been doing for many years, long before I became Prime Minister.

When Mr Goh Chok Tong was Prime Minister, he introduced Edusave, Medifund, the HDB Special Housing Assistance Programme and many other schemes targeted to address specific social needs. When I became Prime Minister, I built on this and took it further. We introduced ComCare in 2004, we introduced Workfare in 2006, we introduced Medifund-Silver in 2008, and in this Twelfth Parliament, we have gone further, and we have broken new ground with our social policies.

The Government and the community doing much more to support individuals and we are helping not only the lower income Singaporeans, but also middle income families through the Special Housing Grant, Wage Credit Scheme, CHAS (Community Health Assist Scheme) and in the process MediShield Life. We will continue to do more wherever necessary, especially for healthcare and retirement adequacy.

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That is why in this latest shuffle of my Ministers, I have strengthened the political leadership of the social Ministries. I put Sam Tan as the Minister of State in PMO in order to coordinate the social policies and, particularly, the implementation on the ground. I put Low Yen Ling as Parliamentary Secretary both in MSF and also in MCCY.

One major safety net which we are working on now is MediShield Life. It is a major improvement over the current MediShield. Universal coverage for everybody, it is coverage for life and it offers better payouts, better protection against very large bills. Of course, because the coverage is better, the premiums have to go up. And I think Singaporeans recognise this so they want to know what the premiums will be. As Mr Gan Kim Yong has explained in Budget and also yesterday when he spoke, we will make sure that premiums are affordable for all.

The MediShield Life Committee has been working on this – consulting, taking views, working out possibilities and they should submit their report soon. I expect by the time Parliament next meets in July, we will be ready to debate that report.

MediShield Life is a very complex undertaking. We must get many important details right and we must ensure that people understand how it works, and how it affects them individually. And that is the reason why I have also reinforced MOH in the reshuffle to have Dr Lam Pin Min come in as Minister of State, and to have Dr Amy Khor already in MOH focusing on MediShield Life outreach. We have to get it right.

Participation in MediShield Life is compulsory. You cannot opt out. Different groups have different concerns. And we have to make sure that all groups are properly taken care of. For example, for workers, we have timed the 1% increase in Medisave contributions in January 2015, paid for by the employers, to help workers pay for their MediShield Life premiums and their other healthcare costs. There is something coming. And for the lower income workers particularly, the Government will help them and their families with subsidies on their premiums, as Minister Gan Kim Yong has explained.

Retirees are another group. The Pioneers are okay because they are covered by the Pioneer Generation Package. Those not quite old enough to be in the Pioneer Package, below 65, they also are covered because they will also have subsidies for their premiums. So, you do not have to worry – it will be okay.

There is one special group of retirees which we watch closely and these are the Government pensioners because we have a responsibility to them. And the Amalgamated Union of Public Employees (AUPE) General-Secretary, Mr Ma Wei Cheng, raised them with

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me recently.

Some Government pensioners already enjoy comprehensive medical benefits for themselves and their families, particularly those who retired earlier. They really did not feel that they needed a lot of extra insurance coverage and they wanted to make sure that they did not lose out when MediShield Life was introduced.

Now, we cannot let Government pensioners opt out from MediShield Life because this is universal – it is compulsory. But we can make sure that Government pensioners are not that adversely affected. And PSD is studying this very carefully together with the unions. After the MediShield Life report is out, it will announce the details and how it proposes to solve this problem for the pensioners.

The Government will do our part to help Singaporeans with MediShield Life. I am confident that employers will help their employees too. The NWC has discussed this and I think they will make some reference to this in the Wage Guidelines this year. Let us work together to get MediShield Life well launched and well implemented.

Besides healthcare, we are also looking at other aspects of retirement adequacy and that means, in simple terms, a stream of income for people to live on in retirement.

There are different approaches to this. The first approach, of course, is to work longer so that you continue to have a salary and you are active and you retire later. Meanwhile, while you are working, you will continue to build up for retirement. We should make it easier for workers who want to work longer to do so.

The unions are very keen on this and the workers too. I have talked to the unionists. They are very happy that with the RRA (Retirement and Re-employment Act), workers can now work until 65 generally, and many are already doing so. Now that they are approaching 65, they want to continue working beyond 65. I understand, I sympathise and we are working towards raising the re-employment age within a few years. Mr Heng Chee How spoke about this yesterday. That is one important way of helping.

A second approach is to help older Singaporeans to unlock the value which is in their HDB flats. We have helped them to build it up, we have helped them to own it and now that they are old and there is value there, I think we should have ways to help them to draw on this value in a controlled way to meet their retirement needs.

Quite a few people rent out rooms in their HDB flats. Some rent out their whole flats and move in with their children. We already have some schemes to unlock the value of the

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HDB property. For example, we have the Silver Housing Bonus – if they decide to move out of their flat and into a Studio Apartment, you can get a bonus from the Government. We have a Lease Buyback Scheme which Er Dr Lee Bee Wah and Mr Gan Thiam Poh talked about – if you are willing to shorten the lease on your flat, while you get a string of money, it goes into your CPF LIFE.

There are ways to do this. And yet, some people still feel asset rich, cash poor – as they put it. MND is studying how we can improve these schemes or come up with different valuations which are emotionally more congenial and easier for people to understand and to accept and use, without feeling that they are giving up their home or not going to have anything to hand over to their children.

The third approach to retirement adequacy is to improve the CPF scheme and the CPF LIFE scheme. Many Members have talked about this – Ms Tin Pei Ling, Mr Zaqy Mohamed, Mrs Lina Chiam.

We want to enhance CPF LIFE so that the payouts can keep pace with the cost of living. We also want to provide stronger assurance in retirement for the lower income groups because the lower income groups may not have much put away in their CPF, either the in the Retirement Account (RA) or in their Special Account (SA) or in their house. So, these are things we are studying carefully. I will say something more about it, I hope, come National Day Rally.

Strengthening safety nets is the right thing for us to do but we have to proceed very, very carefully because it is human nature to want more without wanting to pay more for it. And also, we are going against the tide. We are increasing our social spending precisely at a time when many other developed countries in the world are trying to cut theirs. They are looking at Singapore and they see Singapore as we are today, as a very interesting model to learn from. They think we have got it right – small Government, targeted subsidies, good outcomes in healthcare, minimum poverty, low taxes and a vibrant economy. What is the magic? They want our magic.

We believe we need to improve our system but I think we should not forget that, in fact, a lot of things are working in our system. And as we try to improve it, let us not break the things which are important and which work well for us.

My fear is not that we will lack good intentions. Good intentions are aplenty and many countries have embarked on this path with every good intention and gone awry. You take – not Greece, Italy or Spain which we know about – Australia. The lucky country. The richest natural resources per capita in the world probably. In the 1990s and early 2000s, 15 to 20

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years ago, they ran budget surpluses. Under the Conservatives, the Liberals, under John Howard, they even set up a Future Fund in 2006 to pay for future liabilities out of accumulated surpluses such as pensions for civil servants. They thought they had money. Let us put it away. Do not spend it now. This is for the future, for the rainy day. But it never got to their future because soon after they set up the Fund, the surpluses disappeared.

In Australia, General Elections are held every three years. And very often, elections become auctions. Politicians compete to offer more generous benefits and goodies to the voters so as to win the vote and outbid their competitors. There was one politician in one year, who said, "I am going to raise the GST" – he lost.

So, now, from setting up the Future Fund in 2006, less than a decade later, Australia is facing chronic deficits. Tony Abbott, having come in, elected last year, promising not to make budget cuts, they have had to confront the reality and have just announced massive and painful budget cuts. Australia got itself into these difficulties despite their best intentions and their enormous natural wealth. Imagine how easy it is for Singapore, a small country with no resources, to fall into the same problems.

When people say we should stop being paranoid, let us be confident and go forth, just spend, I think only the paranoids survive. Let us be very careful.

The best way to improve lives is not just to provide safety nets to catch Singaporeans when they fail, but to create ladders of opportunity so that everyone has a chance to succeed, to scale new peaks, regardless of background, regardless of family circumstances.

What do we mean when we say we are keeping pathways open to all? I would like to talk about it in three aspects. One, our schools and education; two, post-schools; and three, the tenor and the tone of our overall society, the ethos of openness and informality which we are trying to maintain in Singapore.

Schools. It starts with schools because education has been and remains an important way to level up. Every Singaporean parent believes that, which is why they pay attention to their kids, they invest in tuition and they angst enormously over which school their children are going to get into or be posted to. We are going to continue to improve our education system to give every child the opportunity to fulfil his potential, and especially those from disadvantaged backgrounds.

So, we are improving the quality of education at all levels – affordable pre-schools, heavily subsidised by the Government, more publicity-funded university places, helping ITE/polytechnic students to upgrade and go on and take further courses in life. We are

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seeking out talented students from humble backgrounds to encourage them to make the best choice for their education, as Assoc Prof Eugene Tan suggested.

The schools have schemes to do this. For example, Raffles Girls School (RGS) invites Primary schools whose students typically do not apply to RGS to identify promising students, who they think could benefit, have a chance. RGS will then meet these students, meet their parents and encourage them to put down RGS as the school of their choice and re-assure them that if they need to, there will be scholarships, there will be financial assistance; they say, "Don't be put off because of money worries."

You can make the best judgement based on your abilities, based on which school fits you best. In every Primary school, we have teachers who advise promising students on suitable Secondary schools to bring out the best in their talents and interests. In fact, we have teachers who will advise all the students, whatever their talents, which schools will best suit them, where they can get the most and the best education to develop them.

So, the schools are making the effort, not just in terms of the content and guidance to the students, but also in terms of the tone, the ethos in the schools and the culture. We need to shape the culture in the schools so that students can interact with one another comfortably and without feeling self-conscious about one being poorer than the other, one being richer than the other. For example, starting with this year's Primary 1 Registration Exercise, we are reserving in every Primary school at least 40 spaces for students with no prior connection to the school, so that we will prevent our schools from becoming closed institutions.

We are also exercising restraint in school spending and activities. Sometimes, having to restrain the schools and ask them not to go overboard in their enthusiasm. For example, raising funds to build infrastructure which must not be lavish, or planning study trips to exotic and expensive destinations. It is not necessary to go to the other side of the world to learn about the world. There are many things you can learn in our own neighbourhoods. The key point is that we must not put off students from poorer homes from studying in top schools because they feel out of place or socially uncomfortable.

In fact, our education system continues to serve children from humble backgrounds well. We still see students winning Government scholarships to study overseas from poor homes. There are kids who win scholarships and study overseas from well-off homes, too. Yes. The difference is the kids from well-off homes without the scholarships, they might still go. If we had no scholarship scheme, the kids from poor homes would not have a chance to go. The scholarship scheme serves them.

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We had one polytechnic student. She and her school mates were preparing a decoration for the Singapore Aerospace. She wrote down on a card her dream – "I dream of becoming the CEO of Pratt & Whitney". She posted it. The CEO of Pratt & Whitney came to the Singapore Aerospace, saw the card, asked who wrote it, and said "I will offer her an internship." First step.

There was another student who dropped out of school to take care of his mother. His mother was ill, he went to take care of her, and later on, he came back to school, went to Northlight, did well, went on to ITE and earned the Outstanding Graduate Award for NITEC in Facility Technology. These are people with grit and determination and talent, and we will look for them and build them up.

Members of Parliament mentioned several other examples too. Mr Hawazi Daipi, Ms Jessica Tan, so did Ms Tin Pei Ling. We know they are there. We will make a special effort to seek them out and we must continue to give these and many more Singaporeans every chance to succeed.

Beyond the schools, keeping paths upwards open also means giving Singaporeans possibilities to improve themselves throughout their lives. We need to strengthen Continuing Education and Training (CET), as Dr Amy Khor and others described. We just opened the Devan Nair Institute for Employment and Employability on May Day. It is in Jurong East, a beautiful institute. It is a one-stop shop for CET, with training providers, classrooms and career counsellors all under one roof. The unions are also working with employers to conduct courses there.

For example, they have got the Tripartite Nautical Training Award for students who want to get nautical qualifications and become sea officers. It is at e2i's Wavelink Maritime Institute. It is a most impressive facility and the most impressive thing about it is that they give the students with a passion, who have decided that they want to learn to become nautical officers and who are making the effort to make the grade, with help from the unions and from the Government.

I met many other trainees there too who are learning new skills. Some had already graduated and have found better paying jobs. I was very happy that they could seize new opportunities even in mid-career.

That is the first CET institute. We are building a second one, which is the Lifelong Learning Institute in Paya Lebar later this year. There will be many more opportunities for everyone to pick up and to sharpen their skills, and that is important not just for rank and

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file workers, but also for PMEs.

Mr Patrick Tay spoke passionately about helping PMEs to cultivate a "second skill" or to deepen their expertise. The Government will support them, together with the employers. But it is not just about the training opportunities. It is really about the whole culture, the whole framework of how people work, study, upgrade, attend courses, are able to change careers and go into second, or maybe even third careers in their working lives.

You need many more pathways to lead fulfilling lives so that one's whole future career is not fixed forever by the time you have left school, depending on how you did in school. What you did in school matters. Every teacher will tell you that. But it should not be the last word on your life.

That is why we set up the ASPIRE Committee under Ms Indranee Rajah. Ms Indranee spoke on this on Monday. Come the National Day Rally, I hope we will have something more to say about this.

Besides our school life and after school, the third aspect of keeping paths up open is to uphold an ethos of openness and informality in our society. What do I mean? We have to be an open and egalitarian society. We must not have rigid hierarchies or class distinctions. People must be able to interact up and down the social ladder, comfortably, self-confidently, without obsequious scraping and bowing. You may be the Prime Minister; you may be a cleaner; you may be a teacher; you may be the student's parent. We are all Singaporeans together, we treat one another with respect. There is informality and easy camaraderie. You do not bow deeply, you do not touch your forehead, you do not "Yes, Sir", "Yes, Sir". In Chinese, they say, "平起平坐".

The wealthy should not flaunt your wealth. Yes, you have been successful. Just keep a modest, low key, unassuming approach. Nobody would think the less of you. Your status is not marked by the car you drive, or the brand of clothes you wear, nor should it be marked by the way you talk. I say that because, in Britain, there is an issue. In the old days, the upper classes spoke one kind of English and the working classes spoke a different English – very different pronunciations, different terminology. An Englishman is classified by the way he speaks, as Bernard Shaw said. Singaporeans must not be like that. You must feel a certain comfort with one another. Neither should you be ostentatious if you are successful, neither should you look down on others because of your physical appearance.

Recently, I read about somebody who made a post on her blog, poking fun at an older man who had a hole in his shirt. I think that is wrong because an old or torn shirt does not mean he deserves less respect. I wear shirt with holes all the time, not in Parliament, but my

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wife says, "It has got a hole in it." I tell her, "Only one. When it has three, I will consider the matter."

These are not essential to who you are, what you stand for, what people should think of you. It has to manifest in the way we interact with one another. One day, I went for a walk at the Botanic Gardens at night. I was not watching when I was walking. I bumped into somebody and I apologised. So, he looked at me, he recognised me. He said, "对不起，总理。刚刚下班。"There was no embarrassment, no obsequiousness, no awkwardness. I said, “对不起. It is my fault." He walked off, I walked off. I think that is something valuable.

But it is not possible for us to be a completely classless society. There is no such thing in the world. Every society has a natural sorting and natural pyramid. Those who are in positions of responsibility have to have due regard. At the same time, if you are in the position of responsibility, you have a duty to the rest of society. Your respect has to be earned, but a society without leaders who are respected is doomed to fail. We have to have that respect. A teacher is in a position of respect and of responsibility over his students. So is the principal. When a parent interacts with the teacher, you have to understand them. A counter staff is in a position serving the public. When you interact with the counter staff, remember, she is serving you. But you owe a responsibility to be respectful of her, to be courteous, to be reasonable. We have to have that kind of a society in order to be able to talk about openness in order to be able to keep that channel and that flow of people moving up and not being closed off by glass ceilings or magic circles or the sense that you were born wrong or you speak wrong or you dress wrong, "Ah, that one just does not fit". That is how we keep ourselves open.

All this strengthening of safety nets and keeping paths upwards open – these are critical policy shifts. As Ms Tan Su Shan said, there are important domestic issues to address when we look through the microscope. But we should also look through the telescope and see where we want Singapore to be.

We are in a much stronger position today than we have been at any time in our history. Our international standing is high; businesses want to come here; "Singapore" the brand name stands for something good in the world. We ourselves may not always appreciate this, but many people who visit us are very impressed by what they see.

I cast around on how I can convey this sense to you, which I feel, my colleagues feel and which Singaporeans who travel and work abroad feel acutely because they see it. They see the respect that they attract once they say, "I am from Singapore."

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So, I decided to share with you some of the letters which we get – unsolicited. I receive them from time to time. Mr Lee Kuan Yew, in his old age, also still receives letters from time to time. So, I will share one which I got and one which Mr Lee got recently.

I will start with the one which Mr Lee got. It was written by an Italian, a lady. Her fiancé asked her to come and to work for our Youth Olympic Games (YOG), when we had the YOG in 2010. She came, she lived here for a while and she has gone back and she is married. She wrote this letter recently to Mr Lee, quite unsolicited. She says:

"Honestly, I cried in seeing those places. I have missed them so much after leaving Singapore. But I could meet all my friends and ex-colleagues. They organised my birthday party and I eat with them all my favourite food. I am crazy of the Chinese carrot cake, bak kut teh, dry noodles, rice porridge – the one in the hawker centre in Redhill is amazing – crab, dim sum and many other dishes. Singapore food is simply delicious. I have met great friends and we always keep in touch."

Then, she talks about others and how she has seen the world and she knows what Singapore is. And she says:

"I write for a geo-political analysis website for free and for pleasure. And I wrote an article about the Singapore model in 2012, and one about you that will be published in the next days. In Italy, no one apparently studied or was interested in Singapore so the website director is happy I can write about Singapore. I would like to keep this passion and write more in the future. I hope to have the chance to meet you one day – just to shake your hand and tell you personally how great you are. When I look at my beautiful country, ruined by bad politicians, I can assure you both right and left parties abused of their privileges and ruined their country. And bad political choices. I think we would need someone like you to adjust everything. My father is struggling nowadays because of the heavy taxation. He has a land to cultivate and an agency of import, export of agricultural products. He visited me together with my mother in Singapore, and was charmed like me. If I can get enough money one day, I would buy a small property so I can spend more days in Singapore, maybe with my father if he can still afford the long hours' flight and show it to my baby how beautiful it is."

So, I think we made a friend. Here is another letter. This is from a Danish man. He came to Singapore as a student to study in INSEAD for the French MBA programme in Buona Vista. He wrote to me and he says:

"Thank you, Singapore. Sometimes, you meet people who talk about life-changing experiences. And our stay in Singapore was as such. Of course, studying at INSEAD is that in

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itself, but attending the school in Singapore somehow just changed me as a person. It is very difficult to pinpoint exactly what did it. The proudness of the Singaporeans, the climate, the perfectly working infrastructure, the hospitality you meet as a student at INSEAD, the police officers who several times took their time to say "Hi" to my boys at the streets, the kindliness from the everyday people all around. Of course, it is the sum of all these, that make Singapore what it is to me."

Then, he left, and went back to Fontainebleau in France. And in the next five years, a lot happened. He says:

"I finished my MBA in Fontainebleau. I have had a really exciting and giving career since, thanks to what I learnt at INSEAD. However, we often talked about our time in Singapore. And when we reached the five-year mark from our departure, I took my boys back to visit the country for three weeks in 2010. We met no disappointing issues, events or experiences. Feels just like coming home. And now it is three years ago we visited Singapore. We still talk about the trip and about how often we can go back. Our hearts stayed in Singapore. So, we will come back for most of September this year."

He was writing last year. He goes on:

"And hopefully, also be able to see the F1 Grand Prix so we can have the chance to experience that as well. I just want to say, 'Thank you, Singapore for what you have given me and my family'. And if I can do anything to give something back, I would be happy to do so. And it could be anything."

I think our reputation is well justifiably good and we must build on this reputation, this foundation. Aim high, so that Singapore will remain a special place and we can create an even better future for our children.

This debate has not touched very much on economic policies. It is partly because we had a thorough discussion during the Budget in February and March, but I think also because Members feel that the policies are on track, as many of you have noted. But there is much work ahead in transforming our economy. We must not assume that success is guaranteed or that we can sit back and relax, or that economic success is unimportant. Sometimes, when people talk, it sounds like that is passé for you to emphasise economic success. Why you are obsessed with it? Because, it is important, and if you do not have that, we are in for a zero-sum game and a nasty time.

We have to work hard to succeed. Singaporeans do work hard but others in Asia are working just as hard, some harder, and many, many are hungrier than we are. We must have

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that ambition and the drive to secure our place in the world's leading cities and make this a city where every citizen can live a fulfilling life. And then, we can grow the pie; and then, we can give everyone a share of our success. Because otherwise, you are robbing Peter to pay Paul and some Singaporeans can gain only if other Singaporeans lose.

That is what we should be doing – working together to grow. Fulfilment comes, not from what others will give to us or do for us, but whether individually or as a nation, from what we do for ourselves. Even more importantly, what we do for others. We have got to keep Singapore this sort of a place – where the economy thrives and the human spirit thrives.

We have policies to create a better Singapore for the future. But the key to realising these policies is to get our politics right. As the President said, we must maintain constructive politics that put our nation and our people first.

Politics cannot just be about politics alone, because Singaporeans' lives and our future are at stake. If you are entering politics, the first question you must ask is, "What do you stand for, what do you believe in, what do you want to achieve in politics for Singaporeans?"

I found it striking that when Mr Low Thia Khiang spoke on Monday on behalf of the Opposition, responding to the President's Address setting out the Government's agenda and programme for the second half of the term, he had nothing to say about the substance of the Government's programme. No critique, no suggestions, no alternatives. Nothing.

There are many sorts of politics, and we have got to get our politics right. We do not want money politics. We do not want power politics. We do not want racial politics. We do not want the politics of envy. Constructive politics can help us to scale new heights. Wrong politics will doom us.

When Mr Low Thia Khiang said, and I quote, "To me, in whatever way politics is described and coloured, it is still politics." That was a breathtakingly cynical view of politics. What is constructive politics? First, it means developing effective policies for Singaporeans; solving problems; creating opportunities; improving the lives of people. It means having good policies, making difficult trade-offs, but persuading people, leading people to get things done.

It means putting forward good people to lead, people capable of integrity and character who can represent Singapore with distinction, who can serve Singapore in an outstanding way. Institutions are important, yes. But equally critical is the quality of the Ministers and the Members of Parliament, and of those who aspire to be Ministers and Members of

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Parliament.

Thirdly, constructive politics means having a robust and open debate; not just engaging in sound-bite politics – if I may quote Dr Janil Puthucheary. You must have a robust and open debate to ensure that proposals are scrutinised, are debated, are argued, so that we find out what the strengths are, identify the weaknesses and the problems, and we come up with the best ideas and solutions for Singapore.

I am very disappointed that the Opposition has offered very little of this in this Parliament. But the scrutiny must extend beyond policies, also to personalities. We have to demand high standards of people in politics. Not through anonymous innuendos or insinuations, especially online – because this is a way to deter good people from entering politics – but responsibly, through open, direct raising of pertinent questions and establishing the truth to prevent incompetent, dishonest or self-serving people from getting into positions of responsibility and doing great harm to Singapore.

Certainly, if ever a PAP Member of Parliament were accused of making false and untruthful statements, I would get to the bottom of the matter. And if he did not do anything about it, I would come to conclusions as to what sort of Member of Parliament he or she was.

Fourthly, constructive politics means maintaining high standards of integrity. Honesty is an absolute necessity; and it is the key difference between politics in Singapore and politics in many other countries. We cannot allow flawed people in politics to be immune from scrutiny. Because we say in politics we can only discuss policies not personalities, or as Mr Low Thia Khiang said, "We believe in live and let live."

Fifth, constructive politics means rallying people together for a common cause. To enable us to achieve broad objectives and accommodate our difference, we all have our pet issues. We all have our matters which we want done. Our demands of the Government, if we each fight our own battles, we are just going to check-mate one another. We have to form a broad coalition, compromise among ourselves, be able to set a general direction which achieves 70%-80% of what each one of us wants, and therefore achieve more for all of us together than we could possibly do by ourselves.

It is more difficult now. Society is more diverse. Interests are less aligned. There are more special interests groups who form more easily. And yet, all the more in this environment, we have got to be able to navigate our next phase of nation-building together.

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If we end up with factional politics, each group pushing for its own single issue – it could be race, language or religion which would be disastrous – we could have NIMBY (Not In My Neighbourhood) groups forming, you can have green agenda, anti-development, you could have those for gay rights, those against gay rights. There is no end to the ways in which you can divide up our society in pursuit of political advantage. And then, our politics would have failed Singapore.

I am describing what constructive politics consist of. But honestly, constructive politics depends on what we as political leaders do, how we act, the decisions we make, the standards we hold ourselves to. It does not just depend on institutions, on culture, on the general environment, something vague which I have no control of but cause me to do what I am doing.

Yes, values, culture, institutions all count. But do not blame them for your own decisions and choices. You are responsible for that. Have the courage and the honesty to take responsibility for what you say and what you do. And I think Dr Janil Puthucheary put it very well yesterday, so I will quote him, "What you say and how you say it are both important, as are what you choose to say nothing about. When you fail to acknowledge the good, when you avoid discussion of consequences or trade-offs, when you spend a whole speech attacking one point you disagree with and fail to support all the other points you should agree with, when you incite division in the name of diversity, when you silently support xenophobia in the name of nationalism, these are not the markers of good politics. No matter how much debate and diversity of opinion they reflect."

The PAP does our best to practise constructive politics. We offer serious policies and debate the trade-offs even when the issues are sensitive, even when they may cause us political brownie points, for example, with the Population White Paper. We uphold the highest standards of integrity and we admit wrongdoings and we put them right, whether or not it is politically inconvenient or embarrassing.

We represent a broad church where Singaporeans accommodate one another to improve and work on our shared goals. And we engage many Singaporeans in our shared future, through the Our Singapore Conversation (OSC), through the MediShield Life consultations, through many other exercises. The Opposition may not think that this is constructive politics but I believe it is and I thank the many Singaporeans who have given their time and energy to contributing, participating and helping to make Singapore better.

And Opposition parties must also uphold the same standards. A case in point: when Ms Indranee Rajah on Monday pointed out that the Workers' Party has flip-flopped on foreign workers, Mr Low Thia Khiang denied this. He said, "Whether we flip-flopped. No. We are not. If she wishes to have a full debate on that, please file a Motion, we are prepared to debate

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that."

Mr Low's denial is simply false. The Workers' Party did flip-flop. The record is there in the Hansard for everyone to see. But his suggestion to file a Motion is not a bad idea and I think it is worth considering.

Many other countries have gotten into trouble because they have not gotten their politics to work. Take the US. Their politics is in gridlock. The US government was shut down last year for a couple of weeks. And even after it re-opened, the US was unable to tackle its long-term problems.

Thailand, despite having the forms of democracy – constitution, free media, elections – its politics cannot bridge the deep and fundamental divides in their society. And no election, no constitution can solve this problem unless the political leaders address these fundamental issues and lead the country together and not apart.

So, we got to maintain constructive politics in Singapore, to develop good policies, solve people's problems, encourage good people of integrity and character to serve and help us to make common cause together to face our future confidently as one people. And that is the task which I ask all Members of Parliament and, indeed, all political parties to join in in the effort.

Singapore has come a long way. We have overcome the odds by working as one people. Our Pioneers sacrificed to build this nation and set Singapore on a path to development and prosperity. Many of them were Members of Parliament in this House, debating vigorously the future of the country, and passing laws that helped build our democracy and our society. And the best way for us to honour them is to build on their legacy, and take Singapore forward. That is how we should celebrate the Golden Jubilee, and I think Minister Lawrence Wong will be talking a bit more about SG50 later in the debate.

For some people, turning 50 is a mid-life crisis. But as the President reminded us, "At 50, we are still a young nation, with great promise ahead." The PAP Government has the ideas, the plans and the team to work with Singaporeans to fulfil this promise and secure our future together. So, join us in this journey, to honour the spirit of our Pioneers and build a better Singapore for our children. Thank you, Mdm Speaker. [Applause.]