Preschools for the People: An Examination of Singapore’s Early Childhood Education Landscape (Part II)

Roosevelt@Yale-NUS delves into Singapore’s Early Childhood Care and Education (ECCE) landscape, examining the current state of quality and access in the sector in a two-part series.

Previously in Part I, we discussed Singapore’s progress towards quality in the ECCE sector. In Part II of this series, we turn towards the accessibility of ECCE, then synthesise the issues of quality and access to deliver insights regarding the industry as a whole.

By Afiya Dikshit (’23), Dineshram Sukumar (’24), Lim Tian Jiao (’23), Shanna Kaur (’23), and Zen Alexander Goh (’23).

Access to Early Childhood Care and Education (ECCE)

The push for more affordable childcare

Singapore’s preschool enrollment rate is very high — as of 2016, over 90% of Singaporean children aged five to six years are enrolled in preschool [1]. Even so, the government has taken further steps to widen the affordability and accessibility of childcare.

For instance, the Early Childhood Development Agency (ECDA) has expanded its childcare subsidy schemes to make raising children more affordable. These measures provide up to S$767 in monthly subsidies to households with a monthly income ceiling of S$12,000 [2].

Childcare centres also include those under the Anchor Operator Scheme (AOP) and the Partner Operator Scheme (POP). The former began in 2009 and supports preschool operators, while the latter started in 2016 and supports childcare centres, to provide good quality and affordable ECCE to children. ECDA has appointed 324 childcare centres under POP and 5 preschool operators under AOP as of now [3]. Both schemes provide additional subsidies for lower income families.

From 2018, anchor operators also opened “mega childcare centres” in high-demand estates, offering a total of 2,700 places [4]. These bring affordable childcare within the convenient reach of many families.

Some still fall through the cracks

While the government has taken commendable action to expand access, there is still room to reach out to specific demographics, such as children from low-income families. While preschool enrollment rates are high on paper, some low-income children fall through the cracks. Additionally, preschool teachers have flagged higher absenteeism from low-income children as a source of concern [5].

This is concerning because quality ECCE has lasting effects on children’s holistic growth and learning potential, even more so for children growing up in disadvantaged backgrounds [6]. Upon entering the formal school system in Primary 1, children are also expected to demonstrate a baseline of cognitive and social competencies, much of which can be learnt in preschool [7]. Should lower-income children be unable to tap on a strong ECCE foundation, academic and social inequality could snowball in their formal schooling years [8].

Ms. Chong Ning Qian, former Senior Executive at Association of Women for Action and Research (AWARE), was part of the research and advocacy team that produced a report [9] on low-income women’s experiences juggling work and care. Ms. Chong explained that despite prevailing subsidies, low-income households may find it difficult to access the highest level of subsidies due to high compliance costs. To unlock a significant Additional Subsidy from ECDA, worth up to S$1,160 monthly in infant care or S$617 in childcare subsidies, families have to be dual-income (see Table 2). That is, in addition to a working father, a mother has to work at least 56 hours a week [10].

  Working Applicant Non-working Applicant
Basic Subsidy (in SGD) Additional Subsidy (in SGD) Basic Subsidy (in SGD) Additional Subsidy (in SGD)
Infant Care (2-18 months) $600 Up to $710 $150 NA
Child Care (18 months-2 years) $300 Up to $467 $150 NA

Table 2: ECDA financial assistance schemes available for preschool education. [2]

In AWARE’s experience, many low-income mothers face issues meeting the work requirements. In cases of informal or home-based work, work hours could be irregular and difficult to document. Those on short-term contract jobs may also find it difficult to get the full range of subsidies if their contracts are not renewed.

Moreover, childcare centres are unable to accommodate low-income parents who work flexible hours or overtime. Ms. Chong iterated that as of August 2020, only about 4% of centres operated beyond 7 p.m. on weekdays, “catering to the needs of parents who work outside standard hours”. As a result, childcare centres become less attractive to parents working odd hours, who must look for alternatives.

Special Approvals are available for individuals that do not meet the requirements for specific reasons, including if mothers are pregnant or looking for employment. [11] However, applications are assessed on a case-by-case basis, often require substantive supporting documentation, and lead to a limited period of assistance. As such, applicants often require assistance from a social worker, who guides applicants through the process. In some cases, a social worker’s “letter of recommendation” becomes key to accessing subsidised childcare [12]. However, not every applicant is assigned a social worker and they may thus be excluded from accessing the full range of subsidies.

Furthermore, while childcare operators are compensated by the government for the additional subsidies themselves, processing subsidies incur high administrative costs which are not fully captured by the existing subsidy system. Maintaining records of subsidy appeals and grants as well as mothers’ employment statuses requires extensive paperwork and continuous communication between the operators, parents, and ECDA. This places immense pressure on the operators, which then creates a “disincentive for operators to enrol low-income children” [13].

The need for greater, more targeted support

To widen access, further government support is crucial. The government is making encouraging moves in this direction, announcing that by “around 2025”, 8 in 10 — or about 200,000 — children will have a place in a Government-supported preschool [14].

On the other hand, ECDA can go one step further to overcome the high costs of accessing subsidies by making childcare automatically free for all low-income families, Ms. Chong suggested. This would allow more children to enter childcare centres without financial worry and alleviate childcare operators from continuous monitoring and paperwork.

For select groups of children, such as those from lower-income families or those with special needs, more targeted interventions would be helpful in addition to the more general schemes available. Tackling the root causes of why some lower-income children have lower attendance rates, or supporting kindergartens in their capacity to take in children with special needs, for example, could prove fruitful.

To this end, existing government programmes such as KidSTART, a holistic programme that supports low-income children and parents up till the age of six with programmes such as home visitation, community-based playgroups, and enhanced preschool support, are promising. KidSTART has currently served 1,000 children since it was established in 2016, and plans to serve 5,000 more by 2025 [15].

Quality and Access: Putting it All Together

In an ideal world, quality and accessibility in early childhood education would come hand in hand. However, these goals are not always easily attainable in tandem.

Amidst the downward cost pressures of capping kindergarten fees, tension exists between ensuring preschool affordability and delivering highest-quality education. “My view is that we have to try and disentangle quality and cost, because it is very hard to put a value on quality; good quality education and preschool education is priceless,” Prof. Ang noted. Ideally, ECCE centres would start from the premise of quality education, then build out a feasible level of provision from this baseline.

However, this is easier said than done.

“Good quality education cannot be provided on the cheap — that is the bottom line,” Prof. Ang commented. In order to make ECCE affordable enough to be widely accessible, the government will need to work with preschool providers to prioritise setting quality standards for the ECCE industry, so as to ensure these standards are applied equitably across all preschools over other ‘good-to-have’ markers such as rigorous certification regimes and academically-intensive pedagogy.

Indeed, in a mixed ECCE system like Singapore’s, where public and private, and for-profit and non-profit operators coexist, some level of economic inequality in childcare opportunities will exist.

In order to balance the diversity of parental choice while ensuring that all ECCE programmes provide children with equal opportunities when they go on to primary school, government support is instrumental. Be it supply-side subsidies, support for parents, or widening the number of spaces in schools, these interventions are the only way to make quality, affordable education viable for all.

Early childhood education is hugely important. Beyond being a vehicle for parents to re-enter the workforce, quality education has lasting impacts on children’s holistic growth and learning potential, and sets the stage for a child’s education in the years to come [16]. Yet, the issues facing the sector are complex.

More government intervention, not less, will be instrumental in the coming years. Government policy will set the tone for the value Singapore places on preschool education, as well as the direction of quality education. While recognising the government’s budget constraints, we hope that due attention will be focused on the ECCE sector as a critical bridge for equality and quality learning.

Roosevelt@Yale-NUS thanks our expert interviewees for their valuable contributions to our series.

Dr. Wu Pinhui, Sandra (吴品慧), EdD, is currently teaching pre-service teachers and Masters students at the National Institute of Education, an institute of Nanyang Technological University,  Singapore. She is the programme leader for the Master of Arts (Educational Management) programme. Prior to joining academia, she had worked in government ministries serving early childhood education and was adjunct lecturer with National Institute of Education International and Singapore University of Social Sciences. She has conducted research in the local pre-school and primary school contexts, and early childhood arts education in Melbourne.

Prof. Lynn Ang is Professor of Early Childhood and Vice-Dean for Research at UCL, Institute of Education in London, United Kingdom. Her research interests include early childhood education across cultures particularly in Southeast Asia and the Asia-Pacific region. Prof. Ang is interested in the social, cultural, and policy influences on children’s development and early learning in a range of formal and informal contexts. Her research centers on the early years curriculum, international early years policy, and issues of diversity and inequality. Prof. Ang is particularly interested in constructions of early childhood care and education from an international perspective, the impact of research, and the ways in which socially relevant research and advocacy for children and families are translated into policy and practice.

Ms. Chong Ning Qian is a former Senior Executive of Research at the Association of Women for Action and Research (AWARE). Her research at AWARE delved into women and children’s rights with regards to early childhood education, culminating in news articles and AWARE reports. She has written numerous policy papers and also made policy suggestions to the government. Ms. Chong has also published in newspapers to provide a feminist analysis on numerous issues including burdens women face in the workforce. Her work also extends to single parents, for whom Ms. Chong has heavily advocated for greater accessibility to housing.


Endnotes

  1. “Statistics On Singaporean Children Who Have Not Attended Pre-School.” Ministry of Social and Family Development, August 15, 2016. https://www.msf.gov.sg/media-room/Pages/Statistics-on-Singaporean-children-who-have-not-attended-pre-school.aspx.
  2. “Subsidies and Financial Assistance.” Early Childhood Development Assistance , November 2020. https://www.ecda.gov.sg/Pages/Subsidies-and-Financial-Assistance.aspx.
  3. ‘Partner Operator Scheme’. Early Childhood Development Assistance, Apr 2021. Accessed 19 July 2021. https://www.ecda.gov.sg/Parents/Pages/POP.aspx.
  4. Goy, Priscilla. “Quality Is Key for Childcare.” The Straits Times, January 21, 2017. https://www.straitstimes.com/singapore/quality-is-key-for-childcare.
  5. “The Big Read: Educators Flag Absentee Rate of Children of Low-Income Families as a Concern.” TODAYonline, August 1, 2015. https://www.todayonline.com/singapore/big-read-educators-flag-absentee-rate-children-low-income-families-concern.
  6. Lim, Sirene. “Commentary: Long-Neglected but Now in the Spotlight, Singapore’s Pre-School Sector.” CNA, February 3, 2021. https://www.channelnewsasia.com/news/commentary/pre-school-enhanced-subsidies-access-moe-kindergartens-11890488.
  7. “Primary 1 English: 8 Things Your Child Must Know before He Starts Primary School.” AsiaOne, May 21, 2019. https://www.asiaone.com/singapore/primary-1-english-8-things-your-child-must-know-he-starts-primary-school.
  8. Vital Voices for Vital Years 2: Perspectives on Early Childhood Development in Singapore. Singapore: Lien Foundation, 2019.
  9. ‘Why Are You Not Working’, Association of Women for Action and Research, 2019. Accessed 19 July 2021. https://www.aware.org.sg/wp-content/uploads/Advocacy-report-why-are-you-not-working-updated-2-April-2019.pdf.
  10. Note: For single-parent families, the single parent has to work at least 56 hours a week.
  11. ‘Subsidies and Financial Assistance’. Early Childhood Development Agency, 2020. Accessed 19 July 2021. https://www.ecda.gov.sg/Pages/Subsidies-and-Financial-Assistance.aspx.
  12. Why Are You Not Working’, Association of Women for Action and Research, 2019. Accessed 19 July 2021. https://www.aware.org.sg/wp-content/uploads/Advocacy-report-why-are-you-not-working-updated-2-April-2019.pdf.
  13. Why Are You Not Working’, Association of Women for Action and Research, 2019. Accessed 19 July 2021. https://www.aware.org.sg/wp-content/uploads/Advocacy-report-why-are-you-not-working-updated-2-April-2019.pdf.
  14. “How Is Preschool in Singapore Being Made More Affordable and Accessible?” Gov.SG, June 26, 2020. https://www.gov.sg/article/how-is-preschool-in-singapore-being-made-more-affordable-and-accessible.
  15. ‘KidSTART’. Early Childhood Development Agency, March 2021. Accessed 19 July 2021. https://www.ecda.gov.sg/Parents/Pages/KidSTART.aspx.
  16. Lim, Sirene. “Commentary: Long-Neglected but Now in the Spotlight, Singapore’s Pre-School Sector.” CNA, February 3, 2021. https://www.channelnewsasia.com/news/commentary/pre-school-enhanced-subsidies-access-moe-kindergartens-11890488.

Image Credit: The New Paper

Preschools for the People: An Examination of Singapore’s Early Childhood Education Landscape (Part I)

Roosevelt@Yale-NUS delves into Singapore’s Early Childhood Care and Education (ECCE) landscape, examining the current state of quality and access in the sector in a two-part series.

In Part I, we zoom into the varied definitions of quality in ECCE and evaluate recent government measures to uplift quality and improve teacher training and retention.

By Afiya Dikshit (’23), Dineshram Sukumar (’24), Lim Tian Jiao (’23), Shanna Kaur (’23), and Zen Alexander Goh (’23).

Singapore’s 2020 Census revealed that the country’s birth rate is at its lowest recorded. Considering the high costs and stresses [1] of raising a child here, this is perhaps unsurprising. This is apparent even in the search for preschool — the Early Childhood Care and Education (ECCE) sector can be difficult to navigate, with a wide array of choices on one hand and limited spaces on the other.

In response to these challenges, the Singapore government has stepped up its commitment to childcare provision in recent years. New initiatives are regulating the sector, providing new opportunities to preschool teachers, and expanding access to and affordability of childcare. How have these initiatives affected quality and access in the ECCE sector?

Roosevelt@Yale-NUS speaks to industry stakeholders to find out more.

A Snapshot of the Landscape

With the exception of 36 Ministry of Education (MOE)-run Kindergartens [2], Singapore’s ECCE scene remains a privatised industry with about 1,900 preschools in operation [3]. Though pre-primary education is not compulsory, ECCE remains critical for two key reasons: it supports mothers [4] in returning to the workforce and prepares children [5] for the rigours of formal education.

The Early Childhood Care and Education (ECCE) landscape has become more competitive in recent years, in part because of a mismatch between demand and supply. In 2017, a shortage of childcare spaces meant that some parents in Punggol and Sengkang had to wait up to 12 months for a spot for their children.

Furthermore, as a loosely regulated sector with a wide range of providers, Singapore’s ECCE landscape has also been noted to be of “uneven quality” [6], with stark fee differences contributing to unequal levels of access to preschool education.

The Singapore government is increasingly intervening in the sector to ensure that baseline standards of quality and affordability are met. In 2019, Prime Minister Lee Hsien Loong announced that Singapore’s S$1 billion annual spending on early childhood education will “more than double” over the coming years. This target persists even amidst economic headwinds from the Covid-19 pandemic [7].

Quality in ECCE

Understanding Quality in ECCE

Among the various government expenditures on ECCE, a significant portion is allocated to enhancing quality. The Early Childhood Development Agency (ECDA) has stated that quality education is necessary to ensure “developmentally appropriate learning experiences for young children to develop holistically and nurture positive attitudes towards learning” [8].

Nevertheless, the issue of quality in early childhood education remains a challenge for the ECCE sector, since there is no fixed definition of the term. Quality in the ECCE sector encompasses a variety of elements, including teacher-student ratio, teacher qualifications, classroom experiences and interactions, and curriculum [9]. Any combination of these factors affects the overall quality of the ECCE services provided. While recent measures are comforting, the overall quality of the ECCE sector is not fully clear.

We categorise efforts to uplift quality into two main components: (1) creating baseline standards that the ECCE industry has to adhere to; and (2) enhancing ECCE pedagogy and delivery with features such as experiential learning and “warm and supportive” teacher-student relationships, which result in “intellectual curiosity and keen inquiry” among students [9]. As the former plays a larger role in ensuring more children receive an acceptable baseline quality of ECCE, it is no surprise most government ECCE initiatives aim to regulate and uplift ECCE baseline standards.

Setting standards on teacher training

Most prominently, the government has long recognised the importance of introducing a top-down notion of educator training. Since 2008, the MOE has endorsed training accreditation schemes to enhance the consistency of teacher training across the board [10]. However, a 2012 Lien Foundation report [11] posited that teachers are inclined to attend the “quickest and easiest” programs, suggesting that approved courses vary in rigour and content. This could hamper the effectiveness of training should teachers shy away from more effort-intensive but important programmes. The sheer variety of private training providers further exacerbates the quality discrepancies between various training programs.

To remedy this, the National Institute of Early Childhood Development (NIEC) was set up in 2019 to raise “standards of preschool teacher training” [12]. NIEC works with ECDA to develop quality preparatory and professional development for ECCE educators with a degree of national standardisation that was previously absent. In doing so, it aims to better prepare and upskill ECCE educators, enabling them to deliver higher standards of ECCE services. NIEC is also working towards standardising training curriculum for ECCE educators across itself and private training agencies.

However, given NIEC’s recent inception, it is too early to definitively see the effectiveness of such measures. Dr. Sandra Wu Pinhui, Lecturer (Policy, Curriculum and Leadership) at Singapore’s National Institute of Education, believes that for effectiveness to be seen, standardisation efforts would require time, rounds of revision, refinement and implementation to meet quality training standards.

More transparent benchmarks welcome

Additionally in 2019, ECDA moved towards better regulation of quality by refining SPARK, its ECCE quality assurance framework. SPARK assesses and accredits Early Childhood Development Centres via a quality rating scale, which was revised to integrate quality indicators for programmes that cater to children from birth to six years and include additional indicators.

Take-up has been relatively strong in the ECCE sector — although accreditation is not compulsory, close to 50% of preschools have been SPARK-certified as of 2020 [13]. This points to an increased recognition of the importance of this baseline direction.

SPARK certification serves as an indicator of quality for preschools to meet and for parents to expect. However, the certification is awarded based on evaluation across 8 criteria and these scores are not made publicly available. This means it is easy to be unsure of what areas of quality a SPARK-certified preschool excels in.

To prevent this, it would be helpful to highlight the criteria that a preschool excels in. SPARK certification ought to be viewed as a minimum accreditation for preschools, rather than as a sign of excellence. Instead, more emphasis should be placed on educating parents on what it means for a pre-school to be SPARK-certified, suggests Professor of Early Childhood Lynn Ang, who has co-authored two extensive research studies into Singapore’s early childhood education scene. These would give greater clarity of the criteria for SPARK certification and enable parents to make more informed decisions about the preschool for their children.

Respect and recognition remain core issues

Besides challenges in forming frameworks to evaluate ECCE services, undervaluation of jobs in the ECCE sector remains a significant obstacle when it comes to retaining quality educarers [14].

The government has made efforts to attract more individuals to enter the ECCE sector through traineeship postings and work attachments. Over 1900 job postings have been made available through the skills framework developed by SkillsFuture Singapore, EDCA, and Workforce Singapore (WSG), in partnership with early childhood stakeholders [15]. Despite these efforts in anticipation of the increased demand for ECCE services, below-average salaries continue to be a hurdle.

In 2020, the median gross monthly income from work [16] (including CPF contributions) for full-time employed residents was S$4,534. However, many ECCE teachers make significantly less than this figure (see Table 1). Only educators under the leadership track, who take on centre or teacher leadership roles, can expect to earn the median or higher, between the range of S$3,100 and S$7,600.

Median Gross (nationwide) Educarers (work with children 2 months to 4 years old) Educators on teacher track (work with children between 4 and 6 years) Educators on leader track (centre or teacher leadership focus)
Monthly Income (in SGD) 4,534 1,800 to 3,150 2,200 to 3,550 3,100 to 7,600

Table 1: Monthly income ranges for educators in the ECCE sector. [15]

To further address the undervaluation of ECCE practitioners, ECDA began giving out yearly awards from 2019 to recognise exemplary individuals in the ECCE field, so as to increase its professional appeal [17]. However, this does little to correct the societal undervaluation of ECCE jobs in practice. Practitioners have often cited a lack of support in their early career as well as overbearing pressure from parents as some of the challenges they face [18]. These mounting pressures can lead to burnout.

As Prof. Ang and Dr. Wu noted, challenges such as parental pressures point to a large societal issue: a lack of understanding and appreciation of the vital role that ECCE practitioners play. Rather than relying solely on practitioners and regulators within the ECCE sector to alleviate overbearing pressures from parents, the government and parents alike should recognise the part they have to play in supporting ECCE practitioners.

Lastly, it must be noted that there is no one catch-all definition of a good ECCE institution: quality depends very much on a child’s individual needs. A child could be enrolled in a preschool that meets all the ‘model’ pedagogical frameworks, but the final benchmark of quality education lies in whether or not the child enjoys and is receptive to learning at their preschool. Singapore’s highly competitive and academic-driven society could encourage parents to choose academically rigorous preschools that may not be best-suited to their child instead of centering on their child’s developmental needs, Prof. Ang noted. As such, more can be done to inform parents on the role of the ECCE sector in their child’s development as well as to develop a deeper appreciation of the practitioners they interact with.

Without a paradigm shift that prioritises child development over precocity, there is unlikely to be a sustainable reduction in pressures faced by ECCE practitioners, as practitioners will have to juggle child development and parental expectations of academic success, detracting from their ability to prioritise child development. As a consequence, retaining quality ECCE practitioners will remain an uphill battle.

In the next piece of this two-part series, we discuss government measures and barriers to access in the ECCE industry.

Roosevelt@Yale-NUS thanks our expert interviewees for their valuable contributions to our series.

Dr. Wu Pinhui, Sandra (吴品慧), EdD, is currently teaching pre-service teachers and Masters students at the National Institute of Education, an institute of Nanyang Technological University,  Singapore. She is the programme leader for the Master of Arts (Educational Management) programme. Prior to joining academia, she had worked in government ministries serving early childhood education and was adjunct lecturer with National Institute of Education International and Singapore University of Social Sciences. She has conducted research in the local pre-school and primary school contexts, and early childhood arts education in Melbourne.

Prof. Lynn Ang is Professor of Early Childhood and Vice-Dean for Research at UCL, Institute of Education in London, United Kingdom. Her research interests include early childhood education across cultures particularly in Southeast Asia and the Asia-Pacific region. Prof. Ang is interested in the social, cultural, and policy influences on children’s development and early learning in a range of formal and informal contexts. Her research centers on the early years curriculum, international early years policy, and issues of diversity and inequality. Prof. Ang is particularly interested in constructions of early childhood care and education from an international perspective, the impact of research, and the ways in which socially relevant research and advocacy for children and families are translated into policy and practice.

Ms. Chong Ning Qian is a former Senior Executive of Research at the Association of Women for Action and Research (AWARE). Her research at AWARE delved into women and children’s rights with regards to early childhood education, culminating in news articles and AWARE reports. She has written numerous policy papers and also made policy suggestions to the government. Ms. Chong has also published in newspapers to provide a feminist analysis on numerous issues including burdens women face in the workforce. Her work also extends to single parents, for whom Ms. Chong has heavily advocated for greater accessibility to housing.


Endnotes

  1. Tan, Poh Lin. “Lessons from Singapore on Raising Fertility Rates .” Lessons from Singapore on Raising Fertility Rates . Accessed August 2, 2021. https://www.imf.org/external/pubs/ft/fandd/2020/03/lessons-from-singapore-on-raising-fertility-rates-tan.htm.
  2. “Ministry of Education.” Overview of MOE Kindergarten. Ministry of Education, July 26, 2021. https://www.moe.gov.sg/preschool/moe-kindergarten/overview/.
  3. Annual Factsheet on ECDC Services . Early Childhood Development Agency , 2021. https://www.ecda.gov.sg/Documents/Resources/ECDA%20Factsheet.pdf.
  4. Klerman, Jacob Alex, and Arleen Leibowitz. ‘Child Care and Women’s Return to Work After Childbirth’. The American Economic Review 80, no. 2 (1990): 284–88.
  5. Kaveri, G. “Commentary: Getting Kids Ready for Primary School Has to Start Even before They Attend Pre-School.” Channel NewsAsia, April 16, 2021. https://www.channelnewsasia.com/news/commentary/kids-preparation-for-primary-one-school-preschool-montessori-14567592.
  6. Vital Voices for Vital Years 2: Perspectives on Early Childhood Development in Singapore. Singapore: Lien Foundation, 2019.
  7. Karuppiah, N. “Want your kids to have a high quality preschool education? Here’s what it means.” TODAYonline, March 4, 2020. https://www.todayonline.com/commentary/kids-quality-pre-school-education-parenting-childcare.
  8. ‘Improving Quality and Affordability of Pre-School Education’. Accessed 19 July 2021. https://www.ecda.gov.sg/PressReleases/Pages/Improving-quality-and-affordability-of-pre-school-education.aspx.
  9. Lim, Sirene. “Commentary: Long-Neglected but Now in the SPOTLIGHT, Singapore’s PRE-SCHOOL Sector.” Channel NewsAsia, September 15, 2019. https://www.channelnewsasia.com/news/commentary/pre-school-enhanced-subsidies-access-moe-kindergartens-11890488.
  10. ‘PQAC Accreditation Standards’. Ministry of Education, 2008. Accessed 19 July 2021. https://www.ecda.gov.sg/Documents/pqac_accreditation_standards.pdf.
  11. Ang, Lynn. Vital Voices for Vital Years: A Study of Leaders’ Perspectives on Improving the Early Childhood Sector in Singapore. Singapore: Lien Foundation, 2012.
  12. About Us | Early Childhood Education Singapore | NIEC’, National Institute of Early Childhood Development, 2021. Accessed 19 July 2021. https://www.niec.edu.sg/about-niec/about-us/.
  13. Annual Factsheet on ECDC Services . Early Childhood Development Agency , 2021. https://www.ecda.gov.sg/Documents/Resources/ECDA%20Factsheet.pdf.
  14. Vital Voices for Vital Years 2: Perspectives on Early Childhood Development in Singapore. Singapore: Lien Foundation, 2019.
  15. Yang, Calvin. “More than 1,900 Jobs Available in Early Childhood Sector; 8 in 10 for PMETs.” The Straits Times, November 2, 2020. https://www.straitstimes.com/singapore/jobs/more-than-1900-jobs-available-in-early-childhood-sector-8-in-10-for-pmets.
  16. ‘Summary Table: Income’. Ministry of Manpower, 2021. Accessed 19 July 2021. https://stats.mom.gov.sg/Pages/Income-Summary-Table.aspx.
  17. ‘ECDA Awards’. Early Childhood Development Agency, 2021. Accessed 19 July 2021. https://www.ecda.gov.sg/Educators/Pages/ECDA-Awards.aspx.
  18. Vital Voices for Vital Years 2: Perspectives on Early Childhood Development in Singapore. Singapore: Lien Foundation, 2019.

Image Credit: The New Paper

Is FinTech The Answer to Climate Change?

By Htet Myet Min Tun (’24) and Choo Wai Keat (’24).

Over the last two centuries, the human population has exploded nearly eight times over, to 7.9 billion in 2021. With this comes an acceleration in the level of environmental degradation, as nature fights a losing battle against the ever-growing demands of people on the planet. In an attempt to fulfill growing demands, technological advances — such as agritech, commercial agriculture, and fishing — have even emerged as the main catalysts and culprits of the level of deterioration we have witnessed and continue to witness today. 

In a talk titled FinTech For A Greener World hosted by Roosevelt Network Yale-NUS College Chapter, Professor Duan Jin-Chuan (shown on the left), Executive Director at Asian Institute of Digital Finance and Jardine Cycle & Carriage Professor at National University of Singapore (NUS) Business School, proposed that technology does not always need to be a part of the problem, but rather a solution to cure the deteriorating environment. In fact, the Bottom-up Greenness (BuG) approach based on financial technology will be the most forward-looking solution to environmental degradation.

The Need for a Supply-Side Strategy

Currently, most approaches to address environmental degradation aim to alter consumption demand. Many current measures, such as the rise of conscious consumerism, tend to be based on arousing a sense of guilt and shame, as well as generally raising awareness of alternatives. Yet, these tactics may not be sufficiently powerful and long-lasting to fundamentally change the course of environmental conservation. This is particularly so in developing countries, where price sensitivity remains the most poignant factor in people’s minds as they opt for cheaper solutions which can guarantee survivability, regardless of the impact they exact on the environment.

At the root of these problems are misaligned economic incentives. When push comes to shove, many consumers opt for low-cost, environmentally damaging solutions because the environmental toll of using these products is largely invisible. To effectively discourage people from adopting environmentally unsustainable actions in their production and consumption requires an approach which forces individuals to internalise the full environmental costs of their actions.

On the other hand, a supply-side strategy is characterised by changing how goods and services are produced and delivered, curbing production before it can even begin to morph into a demand-side problem. 

Some existing policies do employ this approach — for instance, Environmental, Social and Corporate Governance (ESG) rating agencies penalise companies if their environmental record is less than ideal, while environmental non-governmental organisations (NGO) seek to expose companies’ malpractices and raise awareness of environmental issues. 

These measures force companies to bear some of the negative externalities resulting from their actions. However, Prof. Duan argues that both are not flawless, as the former relies on commercial entities which may have alternative motivations, whereas the latter has now reached a plateau and is reaping increasingly diminishing marginal returns.

Enter the Bottom-up Greenness (BuG) Approach

The (BuG) approach could address the issue of economic incentives and apply a supply-side strategy to promote environmental sustainability. This strategy rests on two key pillars — technology and economic incentives. For the former, the application of digital technology and use of modern analytics can establish an evidence-based greenness measurement infrastructure and enable prediction and aggregation in supply chains. For the latter, financial institutions such as banks would consider the aforementioned evidence-based greenness metrics and grant greener companies concessional loans. A bank’s regulatory compliance would rest on whether its portfolio has satisfied greenness standards, and hence, banks would be encouraged to offer more concessional loans to greener entities. In such a model, all players are economically incentivised to strive towards environmental sustainability. 

Prof. Duan highlights that a pilot using the BuG model is slated to be launched by the Asian Institute of Digital Finance in Indonesia’s palm oil industry.

In this model, Using the Internet of Things (IoT), data on palm oil smallholders’ key environmental behaviours, such as their green practices and the level of environmental pollution they cause, can be collected, using satellite images and IoT devices. The research team plans to work with a NGO to establish standards for determining greenness scores and equip university students with skills to assign these scores to smallholders on the ground. Subsequently, research institutes will develop a supervised machine learning model, which scales up the IoT system to more palm oil smallholders, and with a larger sample, generate predicted greenness scores. The greenness scores of these smallholders affect that of other nodes in the palm oil supply chain, i.e. the greenness score for a node in the supply chain — for instance, a palm oil mill or a palm oil company — is partially determined by the greenness scores of the suppliers it sources from. 

This illustrates BuG’s unique ecosystem-level approach. Since greenness scores are assigned not at palm oil companies themselves but tied to every node of the palm oil companies’ supply chain, should compel companies to take ownership at every step of the way. 

At the same time, the BuG approach also accrues several benefits. Firstly, the provision of concessional loans to smallholders would increase financial inclusion, as these entities can more easily gain access to capital. Secondly, the assignment of greenness scores is now bottom-up and more accurate, as opposed to a top-down process rooted in third-party observations. Thirdly, audits can be easily conducted to maintain system integrity, and feedback can be smoothly provided to improve existing procedures. Crucially, auditors can also help to champion environmental sustainability to the population at large, as they are equipped with the knowledge and expertise in this domain.

This then creates a win-win system for all stakeholders, where greenness is integrated into every step of the supply chain. 

Potential Roadblocks

BuG provides an innovative alternative to the current ESG ecosystem. However, we acknowledge that there may remain some practical limitations which could hinder the maximum realisation of its potential.

Firstly, BuG may be difficult to implement on the ground, as the incentives of different stakeholders may not align to the extent that they are willing to cooperate on such a project. This might result in an unwillingness to adopt the BuG framework because the environmental objective of every institution differs. For example, NGO-set standards might be higher than what companies are willing to achieve.

Next, the feasibility of this policy may be up for contention. The BuG is mainly targeted at entities in developing countries. However, these countries may lack sufficient infrastructure and administrative capacity to manage stringent tracking and oversight requirements. This is compounded by the fact that a significant proportion of financial transactions in developing countries occur via informal means.

Lastly, even upon project launch, the BuG mechanism will be primarily run by financial institutions. This could lead to the recurrence of malpractice that currently plagues ESG systems, such as the possibility of established companies “gaming the system” to achieve high ratings on paper. Thus, for the BuG approach to realise its full potential, greater government oversight might be needed in structuring these collaborations.

Can Bottom-Up Greenness be the answer?

In conclusion, BuG is an approach that can be highly effective under certain conditions: stakeholder incentives must align; the environmental issue at hand must be easily resolvable without the presence of entrenched interest groups who stand to gain from the status quo; and efficient institutions must execute the policy. 

We acknowledge that this may not always be possible due to the different circumstances of every industry and country. As such, the BuG approach can serve as a useful complement to other less market-friendly approaches, such as demand-side strategies based on nudging perception or governmental legislation. 

As the world approaches a critical juncture in our fight against climate change, it is now more urgent than ever to conduct a thorough review of existing processes and leverage on the strengths of different players to fashion solutions and foster a more environmentally friendly economy and society. The emerging FinTech industry has great potential to do so. It is our hope that this potential can be translated into policy, action, and reality in the near future.

Professor Duan Jin-Chuan (right) spoke to Yale-NUS College students in a dialogue session in April.

The Roosevelt Network Yale-NUS College Chapter would like to convey its deepest appreciation to Prof. Duan for his insightful sharing.

Singaporean Farmers’ Markets: Building a culture of “buying local”

By Bryan Teo Jun Kai (’24) and Lee Shao Ming (’24).

Farmers’ Markets — sprawling spaces with rows of stalls filled with painstakingly grown produce — serve as a dedicated space for local producers to connect with the community and sell their home-grown produce. However, something special grows amidst the bargaining: an appreciation of the work farmers put into their produce, and a unique culture of “buying local”.

In Singapore, Farmers’ Markets are not yet our preferred shopping option. Most Singaporeans presently get their groceries from giant supermarket chains and wet markets, neither of which exclusively cater to locally-grown produce. Consequently, there remains a lack of awareness of and demand for locally-grown produce among Singaporean consumers.

The Farmers’ Markets that do exist, such as the Loewen’s Farmers’ Market near Dempsey [1], are located far away from denser residential areas and only accessible by private transportation. These are not places most Singaporeans will go to, which means that farmers there suffer from less demand for their home-grown food. A “buy local” culture has yet to be incorporated into our lives.

This poses a challenge to the Singapore Food Agency’s (SFA) 30 by 30 goal [2], which aims for Singapore to produce 30% of our food needs by 2030. With 90% of Singapore’s food dependent on imports, externalities can easily disrupt essential food supply chains, throwing us into immediate instability. Worries around food security, including early panic buying [3] caused by news of Covid-19 lockdowns in early-2020, are never too far away from us.

In light of these concerns, the SFA has poured significant resources into enhancing local production of food and maintaining affordable prices for consumers [4]. On the supply side, we appear to be making significant progress.

However, we must not forget about the demand side of things. Locally-produced food needs strong and stable demand from Singaporean consumers to be a mainstay. To cultivate this long-term demand, the current mechanism through which local farmers sell their produce is insufficient. Because of a lack of accessibility to and awareness about local produce, local farmers struggle to see sustainable demand for their goods. If this persists, the resources and hard work invested into them may end up like that of a single hand trying to clap: for naught. 

We need to bring our Farmers’ Markets to more central locations, so that they become more accessible to a wider consumer base in Singapore, where they can then play a strong role in developing demand for local produce. We suggest that Farmers’ Markets instead leverage upon the convenience of existing supermarket chains and wet markets, while incorporating the benefits of traditional Farmers’ Markets: home-grown produce and a connection between farmers and consumers. This would be a hybridised version of a Farmers’ Market, uniquely adapted to our urban setting. 

This way, we maintain the convenience that Singaporeans are used to, but add the benefits that Farmers’ Markets bring to their communities. A 2019 study, for example, concluded that Farmers’ Markets allow producers to be in direct contact with consumers, adding to the number of socially and environmentally sustainable food systems [5]. Another earlier article [6] shows how Farmers’ Markets in Vancouver Island promote local food security, buffering its residents against disruptions of long term food supply. All these are in line with Singapore’s own food sustainability goals.

Dedicated spaces for local farmers in supermarkets and wet markets

First, to expose Singaporeans to local produce, the SFA should collaborate with popular supermarkets and wet markets to dedicate a section of space just for local produce. This would enable local farmers and their produce to connect to Singaporeans directly without radically altering the way people already get their food. More importantly, these dedicated spaces would familiarise local consumers with local produce and brands, and emphasise the origins of these produce more prominently than current miniscule labels do [7]. This would help cultivate an instinct for buying local, and encourage customers to pay attention to the origin of their produce over time.

Shoppers should not be faced with faceless shelves of local produce. Local farmers themselves can be present in the supermarkets and wet markets, building ties with their customers. Such socialisation would allow farmers to build brand awareness and customer loyalty to their produce, securing a critical mass of local demand over time. 

Bringing Farmers’ Markets into the residential spaces  

Furthermore, another way to introduce Farmers’ Markets into Singaporean culture would be to situate the markets amid public housing. The issue of under-utilised spaces such as car parks and void decks have been recognised by the government, who have called on the public to provide creative ways to utilise the space for community development [8].

These spaces are well-suited for hosting our version of Farmers’ Markets. With inter-government agency collaborations between the Housing and Development Board (HDB) and the SFA, we could have farmers’ markets featuring local farmers selling their produce and interacting with consumers in the void decks and other open spaces near the HDB blocks.

Here, it is worth considering the theory of third places. The theory of third places is defined by sociologist Ray Oldenburg in his book The Great Good Place as “anchors of community life (which) facilitate and foster broader, more creative interaction” [9]. Put simply, it is a welcoming ground for social interactions. 

The incorporation of Farmers’ Markets into the under-utilised public spaces would achieve this additional goal of carving out third places. Due to the proximity of these places to public housing, the practical need for people to purchase produce, and the novelty of our proposed solution, we expect that these under-utilised places will transform into bustling hotspots by facilitating social interactions. Hence, a culture of buying local produce via Farmers’ Markets can be successfully cultivated across all these public spaces.

As a small nation, Singapore continuously faces the challenges of space and manpower. Our proposed solutions, which uses existing infrastructure to carve out dedicated sections in supermarkets and wet markets for local produce, as well as situating Farmers’ Markets in under-utilised public housing spaces, address these challenges directly and conveniently.

With their long-term benefit of enhancing local food security, supporting local producers, and bringing our communities closer together, it is clear that the development of Farmers’ Markets in Singapore is the way forward.


Endnotes

  1. “Farmer’s Markets At Loewen Gardens.” The New Age Parents. The New Age Parents, 2018. https://thenewageparents.com/farmers-markets-at-loewen-gardens/.
  2. Ai-Lien, Chang. “Singapore Sets 30% Goal for Home-Grown Food by 2030.” The Straits Times, March 8, 2019. https://www.straitstimes.com/singapore/spore-sets-30-goal-for-home-grown-food-by-2030.
  3. “Panic Buying Hits Singapore after Virus Alert Raised.” businesstimes.com.sg, February 8, 2020. https://www.businesstimes.com.sg/government-economy/panic-buying-hits-singapore-after-virus-alert-raised.
  4. Singapore Food Agency. “Our Singapore Food Story.” SFA, 2020. https://www.sfa.gov.sg/food-farming/sgfoodstory/supporting-local-produce.
  5. Figueroa-Rodríguez, Katia, María Álvarez-Ávila, Fabiola Hernández Castillo, Rita Schwentesius Rindermann, and Benjamín Figueroa-Sandoval. “Farmers’ Market Actors, Dynamics, and Attributes: A Bibliometric Study.” Sustainability 11, no. 3 (2019): 745. https://doi.org/10.3390/su11030745.
  6. Alexandra, Link, and Chris, Link “Farmers’ Markets and Local Food Systems.” CRC Research, 2007. Accessed July 25, 2021. https://www.crcresearch.org/crc-case-studies/farmers-markets-and-local-food-systems.
  7. Singapore Food Agency. “Our Singapore Food Story.” SFA, 2020. https://www.sfa.gov.sg/food-farming/sgfoodstory/supporting-local-produce.
  8. Teo, Gwyneth. “Singapore Urban Design Festival Organisers Look at under-Utilised Spaces for Events: Video.” Channel NewsAsia, November 7, 2020. https://www.channelnewsasia.com/news/singapore/singapore-urban-design-festival-organisers-look-at-under-11353164.
  9. Oldenburg, Ray. The Great Good Place: cafés, Coffee Shops, Bookstores, Bars, Hair Salons, and Other Hangouts at the Heart of a Community. Cambridge, MA: Da Capo Press, 1999.
  10. Lim, Natalie. “5 Farmers’ Markets In Singapore To Switch Up Your Otherwise Mundane Grocery Runs.” TheSmartLocal, January 9, 2020. https://thesmartlocal.com/read/farmers-markets/.
  11. Dodds, Rachel, Mark Holmes, Vichukan Arunsopha, Nicole Chin, Trang Le, Samantha Maung, and Mimi Shum. “Consumer Choice and Farmers’ Markets.” Journal of Agricultural and Environmental Ethics 27, no. 3 (2013): 397–416. https://doi.org/10.1007/s10806-013-9469-4.

Image credit: Unsplash

A contemporary evaluation of the Progressive Wage Model

By Shaharaj Ahmed (’23).

An abridged version of this piece is slated to be published in the Singapore Policy Journal.

Public consensus that Singapore’s low-skill workers need to be paid more has sparked calls for more progressive and robust labour laws, including wage interventions such as the minimum wage. The government has acceded, in some way, through their own solution to the issue of stagnating low wages with the Progressive Wage Model (PWM). The PWM has been touted by some top government officials as “Minimum Wage Plus” [1] because on top of stipulating a basic wage, it also provides a clear structure for Singapore’s lowest workers to raise their wages by taking courses and more responsibilities in order to qualify for higher level positions and other promotions. 

In theory, the policy seems ideal. However, in practice, it has limitations which many talk about but few truly understand. In this piece, I will be explaining the limitations of the PWM, particularly its effects on productivity and wages, legal ambiguity, and cost of implementation. 

Productivity

As mentioned, the PWM codifies into policy the practice of increased productivity for increased pay.  For example, if you are a cleaner and take a course to become a specialised waste disposal cleaner, then you get paid a higher wage. The PWM is currently being implemented in the landscaping, cleaning, and security industries. However, realistically, this notion of career development and increased productivity for low-skilled jobs in these industries is impossible to achieve for two reasons: a lack of room for increased efficiency and a lack of promotion opportunities. 

The most basic reason as to why a worker may not be able to increase their productivity is that there simply is no more room for efficiency. In many of the jobs where the PWM is applicable — security, cleaning, and landscaping — if a worker is operating at their full capacity, then chances are that is the full productive capacity of any worker. This argument becomes clearer once we realise that there is nothing inherent about these jobs that require skills, significant training, or education. Whereas to be a doctor or a soccer player, one needs innate skill and/or many years of training, to be a cleaner is to merely clean. If a dishwasher can only wash 40 dishes an hour with current technology, then there is no way for the PWM to raise that rate to increase the dishwasher’s productivity. The only way to increase the productivity of that worker is to increase the technological capabilities of that worker. In a video interview, Mr. Raj Joshua Thomas, Nominated Member of Parliament and President of the Security Association Singapore, argued that employers, at least in the security industry, should invest in technology to expand the job scope of security guards [2]. Thus, while proponents may laud the PWM for stipulating a recommended wage band that employees can use to negotiate for higher wages, there is little demonstrable productivity increases that employees can offer to justify wage increases unless the industry itself invests in better technology and allows workers to use said technology after training.

The other main method through which the PWM promotes productivity is career promotion. This is an unlikely prospect in the industries the PWM is currently implemented in — security, landscaping, and cleaning. In these industries, senior positions — scarce to begin with — are always filled up. Many security guards, despite taking the time to undertake courses and training certifications to qualify for senior positions, often fail to get promoted because there is no space on the upper rung [3]. At the end of the day, with a pyramid hierarchy, most workers will have to do general, mundane work and only some will be selected for specialist work such as lift maintenance in the landscaping industry or managerial positions such as a senior security supervisor in the security industry. This seems to be a critical flaw of the PWM: to assume that specialist roles will continue to be produced, thus allowing junior workers to abdicate their generalist roles, without rewarding the workers who continue to shoulder the base responsibilities of the organisation. 

For example, let us observe the career ladder for a cleaner in the Group 3 cluster of the cleaning industry, as illustrated in Figure 1 below. A cleaner starts out with a base pay of S$1,442. While it is desirable from the cleaner’s perspective to take courses to become a supervisor and gain a base pay of S$1,854, it is also in their colleagues’ interests to take these same courses to qualify as a supervisor. Hence, there is collective upward pressure for an already scarce job. Thus, while there is a worker who does get promoted to the managerial position (assuming it is open) and gains a higher salary, the PWM does nothing for the worker who is forced to remain in the bottom rungs of the ladder despite being qualified to be promoted, because at the end of the day, someone has to do the general cleaning. Let us, however, assume a case where it is possible for everyone to be a supervisor and gain higher pay. Who then will do the general cleaning? It is this inflexibility of the PWM to recognise that most workers will not be able to climb the PWM ladder because of the lack of vacant senior positions that makes the promise of increased productivity a myth. This is evidenced by the fact that most PWM industries, particularly the security industry, are suffering from manpower crunches in junior positions, not senior ones. Everyone wants to be a manager. 

Figure 1: Career ladders for the cleaning industry [4].

This flaw indicates the presence of a more problematic ideology pervading our conversations around income inequality: that workers are ‘worthy’ of more pay if they are higher up on the career ladder, and conversely, not ‘worthy’ if they are lower on the career ladder. For those at the bottom, this can mean an income that does not meet their basic needs, even as they are employed and work as best as they can. In addition, it implies that the essential base of general workers are less deserving, even though these workers are responsible for the bulk of daily operations.

Furthermore, in real life, the PWM theory of raising productivity falls into more issues. While in the discussion above we maintain the assumption that getting promoted means the worker receives differentiated and advanced work, employers may not have that type of work. Mr. Thomas noted in an interview with Rice Media that for the security industry, “[t]here is very little difference between a Level 1 officers’ job scope and a Level 2 officer, and even between Level 2 officers and Level 3 supervisor.” Career development is theoretical, at this stage, for most PWM workers [5].

Wages

The PWM also does not effectively raise wages for low-wage Singaporean workers, on six counts:

  1. it does not sufficiently encourage the promotion of elderly Singaporean workers;
  2. it does not take into consideration the mass inflow of foreign labour; 
  3. the stipulated basic wage becomes a stagnant wage floor due to market oversaturation and a lack of business interest in raising wages;
  4. it does not ensure stability of the increased wages when companies change;
  5. its expansion into new industries reduces gross wages; and
  6. it does not provide a livable wage.

Firstly, the claim that PWM helps raise the productivities and incomes of low-wage Singaporean workers is nullified by the employment practices of firms and the demographics of the low-wage labourers. Many Singaporean residents in the PWM industries tend to be older and hence less able and slower. Consequently, firms prefer to hire foreign workers at the higher rungs of the PWM ladder [6], leaving elderly Singaporean workers at the lower rungs of the PWM ladder. Professor of Economics at University of Michigan, Prof. Linda Lim, corroborates this through her research, which found that employers tend to hire more able, younger foreign workers to fill up the upper roles, rather than older local residents, since they are able to gain more economic value from their employees this way. 

The second structural issue is the PWM’s inability to manage the mass inflow of foreign labour into PWM-covered labour-intensive industries, which Prof. Lim has credited as the main depressors of wage growth for low-skilled labour in Singapore [7]. Hiring agencies have relied on foreign labour due to many reasons, key amongst them is costs. Particularly for the PWM industries, which face an aging workforce and labour shortages due to the unattractiveness of the roles, hiring foreign workers is an easier solution than offering higher wages for older workers. Thus, the inability of the PWM to contend with foreign labour inflows prevents industry-wide wage growth, denying Singaporeans in such industries higher wages.

We should note that foreign hiring is not a problem in all industries. Mr. Thomas reminds us that this is not the practice in the security industry due to various regulations on hiring foreign workers.

The third limitation of the PWM is that ironically it becomes a sticky wage floor. A sticky wage floor is a situation in which workers are unable to gain higher wages beyond the legal minimum. This could occur for a variety of reasons. One direct cause of this sticky wage floor is the market saturation in these industries. As a consequence of excess supply,  cleaning, landscaping, and security outsourcing companies usually outbid each other to offer the lowest contract price possible (which companies are inclined to accept). This means that workers in these job types are paid the lowest wages legally possible. Mr. Thomas shared that the trade association has received sufficiently alarming feedback on regulatory infractions made by some security agencies, which flout PWM rules to underbid competitors [8]. These regulatory infractions demonstrate that market saturation has evolved to the point that firms are willing to depress wages to survive, even to the point of breaking the law.

Consequently, even when demand for services such as cleaning, dishwashing, security, or landscaping increases, wages remain stagnant. Professor of Social Work at the National University of Singapore (NUS), Prof. Irene Ng, posits [9] that when demand rises, more firms enter already saturated industries and each bid to the lowest point possible, driving wages down despite a rise in demand. Mr. Thomas mentioned that roughly 95% of the roughly 250 security agencies in the industry are small, indicating small barriers to entry and exit for firms within the industry. As a solution, he and his team have proposed setting up higher barriers to entry into the industry, such as raising the initial paid-up capital. However, these are yet to be legislated or adapted into policy. Since the PWM does not regulate foreign labour inflows or industry-wide practices, it may be good to expand the scope of the PWM to tackle these issues if we hope to drive up the wages of low-income Singaporeans.

Another reason for the sticky wage floor is that there are no incentives for employers to pay workers any higher. The most vivid remark I came across on this topic was from Channel NewsAsia’s (CNA) interview with Mr. Steve Tan, who is the executive secretary of the Union for Security Employees. He disclosed to CNA that in his tripartite negotiations, he came across a buyer who said “[the] same (security) uncle before and after? Why should I pay you S$50 more?” [10]. While policy-wise, the PWM actually provides a wage bracket as a guide for firms to pay their workers for each level, practically, firms are incentivised to pay the bare minimum [11]

Upon reflecting on this last comment, it seems that there is a case where employers might be prepared to pay a higher wage — if workers take on more responsibility. However, as previously pointed out, there is realistically little room for workers to do so. Thus, the interaction between wage and productivity hampers upward mobility under the PWM regime. 

Mr. Thomas, however, disagreed on this point, replying that security workers do in fact have leeway in negotiating higher wages. One negotiating tactic is to use the fact that Covid-19 has increased demand for security workers through government initiatives such as SafeEntry booths, which increases the manpower needed by security agencies. It is important to note that this induced demand is, however, temporary. Another more substantial negotiating tactic is to remind security agencies of the manpower crunch they are facing. As noted by Rice Media and later confirmed by Mr. Thomas, many junior positions in security agencies nation-wide are vacant. However, it can also be argued that despite facing labour shortages, employers in the security industry may choose to forego hiring workers rather than pay higher wages. Thus, while PWM-covered workers may have some flexibility in negotiating for higher wages, gains from negotiation are not likely to be too substantial.

Altogether, the presence of a wage floor indicates a more troubling issue: the presence of a culture that is obsessed with cost rather than welfare. The above example of an employer haggling over a wage increase of S$50 that would have clearly benefited the low-income worker more than it would have to themselves indicates an unhealthy obsession with capitalist accumulation. Furthermore, the fact that many security agencies often bid contracts with the lowest contract value indicates the presence of employers more concerned with maximising their dollars rather than paying fairer wages to the workers providing the service. While it is not problematic to want services that are as efficient and valuable as possible, it is problematic when in doing so one’s workers are not paid what is needed to survive (as demonstrated later in the piece).

Fourth, wage gains from the PWM are unstable as they are constantly under threat of being reset to the base salaries. Prof. Ng documents that whenever the hiring firm puts out a tender for another outsourcing firm for its cleaning, landscaping, or security needs, there is a high chance that the incumbent outsourcing firm will lose the tender and have to leave the current location. If the incumbent outsourcing firm loses the tender and is forced to move, its employees have two options: move with it or stay at their current location. Employees usually choose to stay due to a factor of reasons such as proximity from home. If they choose to stay, their wages become reset to base amounts [12]. This is due to the fact that in the PWM’s implementation any experience or skills gains made under the PWM are recognised and rewarded within the firm alone, and cannot be transferred. Though the theoretical practice should be that all firms in the industry recognise the experience of the worker holistically, the incoming outsourcing company ultimately aims to bid the lowest contract, and so, are unable to pay more to experienced employees due to a lack of funds. Thus, even if an employee were to work in the same industry for 8 years, any progress on the PWM ladder and gains in wages would be reset if the outsourcing company were to change.

Fifth, though expanding the PWM into other industries increases basic wages of workers, there is evidence that gross wages fall. Recently, the Singaporean government has discussed expanding the PWM into other industries such as food and retail services. In his undergraduate thesis, Mr. Kenneth Ler, a NUS graduate, found that though there was an increase in basic wages after PWM came into effect, they found a decrease in gross wages (e.g. overtime pay, allowance, bonus) [13]. One hypothesis for this, which I believe to be most likely given the employment culture, is that employers cut down these benefits in order to comply with the PWM regulations, while also maintaining competitive contracts. Another hypothesis which Mr. Ler proposed, and Mr. Thomas independently brought up, was how these bonuses were to be used in order to reward productivity in the true spirit of the PWM. However, it is not clear why current employees must face a reset in their allowances and bonuses if they’ve worked with an employer for many years before the PWM was implemented. Thus, it is likely that we are to witness this effect in the next few months if the PWM is expanded into other sectors. 

The final limitation of the PWM’s ability to raise wages is its inability to provide a liveable wage. A group of academics from the Nanyang Technological University (NTU), NUS, Duke-NUS, and Beyond Social Services conducted a study to ascertain the Minimum Income Standard (MIS) in Singapore, and found that for a household of a single individual aged between 55 and 64, the minimum income standards were S$1,721, assuming that the individual does not have any ‘chronic conditions and major illnesses’ [14]. 

Mr. Lim Jingzhou, a community worker, calculated [15] how much PWM workers in different industries make, accounting for Workfare Income Supplement (WIS) payouts, a subsidy to boost the monthly wages of employees and self-employed workers who are paid below S$2,300He found that for a worker in the cleaning industry within the age band of 55-59 takes home S$1,185.39, as shown in Figure 2. For this type of household, it is clear that the wages offered by the PWM, accompanied by WIS payouts, will not be sufficient to meet baseline income standards, as illustrated in Figure 3. However, the PWM does meet the basic income standards for single elderly households (elderly defined as those beyond the age of 64), as Mr. Lim finds that workers in the age band of those greater than 65 earn S$1,662, versus the baseline income requirements of this type of households at S$1,379. While single elderly households can technically support themselves with the PWM, it is morally undesirable to have elderly workers working in the first place, let alone working full time. Furthermore, let us not forget that their costs would definitely be higher (and the payouts from the PWM and WIS would be even more lacking) if they are facing medical bills or chronic/major illnesses — which is likely the case, as many elderly are forced into work at an old age to pay for medical bills for themselves or an elderly spouse or sibling.

Figure 2: Pay of workers in the cleaning industry for 1st July 2020 to 30th June 2021, accounting for WIS, CPF. [16].

There are two interesting notes within this discussion on wages. While the PWM’s proponents are proud that the scheme increases the pay of these workers, it is important to note the amount of money they receive versus the amount of money they are able to spend. The column labelled ‘Take-Home Cash’ represents the real wage cleaners are actually able to spend. This is because part of the money they are paid through the PWM goes to their Central Provident Fund (CPF), which they are unable to access until they are at least 55 years old (the age when a Singaporean resident can apply to withdraw money from their CPF account). 

Figure 3: Data visualisation of take-home pay, accounting for WIS handouts and income requirements against age. 

Another interesting note is the discrimination of age in subsidy handouts. As observed in figure 3 above, workers in the PWM industries gain higher take-home pay for the same position as they age due to the nature of the WIS policy (assuming they stay in the same position). This is problematic because in different stages of life, different workers have different needs to fulfill. For instance, younger workers such as those in their mid-30s may have dependent children for which many expenditures are realised. While this is a reflection of the government’s desire to move workers into higher-paying jobs, it does not take away from the fact that the low PWM floor means some needs of PWM workers are unmet.

It is important to note that the above discussion does not mean that every household is a single, elderly person or an individual between 55 and 64 years old. It is likely that many of the households are families with multiple dependents and single employed adults such as single, working mothers/fathers or old caregivers with elderly parents unable to work. While the MIS team is currently investigating what the minimum income benchmark is for other types of households, it is clear that with education, rent, medical fees, and much more, expenses for families can all pile up very quickly. More research needs to be done to account for households such as these, but it is clear that the PWM is unlikely to make the basic income standards required to live or support dependents [17].

Working Hours, Culture, and Complexity

There is a relationship between wages and working hours: more wages are paid for longer working hours. It is clear that PWM workers cannot make ends meet on their singular salaries alone. While there will be households with multiple workers or income streams, there will also be single households. 

These households have two ways, other than borrowing money, to make up for the income shortfall: work overtime, and/or work multiple jobs. PWM workers often do both. For example, a Rice Media interview with security guards found even those who earn more due to being situated higher on the PWM ladder often take up additional jobs, even after factoring in overtime pay. The situation is likely worse for their lower-rung colleagues. 

It is clear that employees in PWM industries are overworked. Workers in the security, cleaning, and landscaping industries work higher than average hours per week, as illustrated in Figure 4, and frequently work six-day work weeks. This is despite the fact that higher-paid white-collar workers in Singapore work the norm: 9AM to 5PM daily for five days a week.

Furthermore, many security guards often take on other jobs to supplement their income and support their families. A research study found that cleaners also take on longer hours to earn more money [18]. Unfortunately, the PWM’s provisions seem to give little consideration to working hours, despite its interaction with wages. It does seem to be that for the security industry, like the other two industries, the PWM has left its workers underpaid and overworked. 

Figure 4: A comparison of average working hours of PWM industries against other professions [19].

While one could argue that cleaners and landscaping employees clock relatively lower working hours as compared to construction workers, it is important to note that cleaners and landscapers often work other part-time jobs to make ends meet. Hence, what is represented above may not necessarily represent the true duration full-time cleaners, landscapers, and security guards are working. What is salient, however, is the long working hours faced by PWM workers. 

Collectively, while long working hours and insufficient pay have led to careers in the PWM industries being relatively unattractive to the younger Singaporean demographic, cultural perceptions are also a significant deterrent. In Singapore, it is seen as culturally and socially unfit to work in a menial job such as a cleaner, security guard, or landscaping role, when the norm is to work a traditional 9-5 desk job. The more significant deterrent is the fact that stipulated PWM wages are around 60-70% lower than the median wage. Though the PWM signals a commitment to increase wages, the cultural perceptions of the industry remain unchanged with the PWM.

The final limitation of the PWM is its complexity. One can understand the PWM as a wage system by which employees are given the opportunity to upgrade their skills and gain higher wages. However, it is also an entire policy ecosystem. It works in conjunction with WIS and Silver Support Scheme to top up wages of workers. Furthermore, the policy has to be coordinated with foreign dependency quotas. This is due to the fact that if employers are able to import labour at cheaper wages compared to Singaporean residents, then employers will do that rather than comply with PWM regulations. Finally, the government as, well as employers and labour unions, have to meet frequently to revise wages to account for inflationary pressures.

This complex nature of the PWM has three effects. Firstly, it makes it harder for employees under the PWM to fully understand what they are legally entitled to. Mr. Thomas had discussed how security agencies occasionally undercut each other [20]. While doing so, they often reduce the pay of employees below the PWM minimum, effectively breaking the law. Under the PWM, as there is complex bureaucracy involved, employees may not realise that they are being paid below the legal minimum or are having other benefits such as paid leave or breaks cut. This effect becomes exaggerated once we recognise that the people working these jobs tend to be less aware of the policy and legal codes that dictate their employment conditions and rights. The PWM is a broad policy network of wage floors, skills ladders, and subsidies which are vast amounts of information that low-income workers don’t have the time, resources, and confidence to understand. Prof. Ng finds in her research serious evidence of unaware cleaners and employers who take advantage of their unawareness to squeeze as much labour with minimum cost from them in this manner. Furthermore, considering the fact that low-income workers usually work overtime/other odd jobs to make ends meet, it is even more likely they do not have the time nor capacity to read up on such policies and legislation.

Secondly, the PWM is a challenge for the government to enforce as they must audit the books of firms to ensure that employers are complying with PWM regulations. Going back to the example of security agencies undercutting their competitors, a significant amount of manpower has to be dedicated by the government to ensure that security firms are not underpaying their employees as a means of gaining contracts. This second effect correlates with the third point that the bureaucracy maintaining the PWM overall becomes heavy and relatively expensive to maintain. Bureaucracy eventually becomes overladen in the sense that civil servants are required to go through a lot of training and paperwork to understand and enforce legislation that is complex, like the PWM. 

In sum, while I believe that the PWM is a theoretically sound policy, as it stands and as it is being implemented at the moment, the PWM is insufficient in achieving the aim of  providing a liveable wage for workers in the cleaning, security, and landscaping industries. It is a complex, expensive, and heavily bureaucratic system that falls short of providing a dignified existence for low-income workers. While I offer no alternative pathways towards providing a decent pay, the revisions that must come to the PWM or the PWM’s successor must take into account the demographic, cultural, and socio-economic conditions laid out in this piece.


Endnotes

  1. Tang, See Kit. “Tharman, PAP MPs Debate Minimum Wage, Policymaking with WP’s Jamus Lim.” Channel NewsAsia. September 3, 2020.
  2. Chew, Sophie, and Andre Frois. “What The PWM Could Do That A Minimum Wage Can’t: Make Buyers Pay Fair Prices.” Rice Media. Rice Media, November 7, 2020. https://www.ricemedia.co/current-affairs-features-progressive-wage-model-security-agencies/.
  3. Chew, Sophie, Edoardo Liotta, Louisa Lim, Andre Frois, and Ivan K. Wu. “How Much Progress Has The Progressive Wage Model Led To? We Asked Security Guards What They Think.” Rice Media. Rice Media, October 14, 2020. https://www.ricemedia.co/current-affairs-features-progressive-wage-model-security-guards/.
  4. “Progressive Wage Model for the Cleaning Sector.” Ministry of Manpower Singapore, 2021. Accessed July 25, 2021. https://www.mom.gov.sg/employment-practices/progressive-wage-model/cleaning-sector.
  5. Chew, Sophie, and Andre Frois. “What The PWM Could Do That A Minimum Wage Can’t: Make Buyers Pay Fair Prices.” Rice Media. Rice Media, November 7, 2020. https://www.ricemedia.co/current-affairs-features-progressive-wage-model-security-agencies/.
  6. This is true for at least the cleaning and landscaping industries; the security industry has to rely on the Singaporean labour pool and can at best hire Malaysians.
  7. Lim, Linda. “The Economic Case for a Minimum Wage: a Conversation with Linda Lim – Academia: SG.” Academia.edu. Academia.edu, July 25, 2020. https://www.academia.sg/academic-views/minimum-wage-conversation/.
  8. Chew, Sophie, and Andre Frois. “What The PWM Could Do That A Minimum Wage Can’t: Make Buyers Pay Fair Prices.” Rice Media. Rice Media, November 7, 2020. https://www.ricemedia.co/current-affairs-features-progressive-wage-model-security-agencies/.
  9. Ng, Irene YH, Yi Ying Ng, and Poh Choo Lee. “Singapore’s Restructuring of Low-Wage Work: Have Cleaning Job Conditions Improved?” The Economic and Labour Relations Review 29, no. 3 (2018): 308–27. https://doi.org/10.1177/1035304618782558.
  10. Min, Chew Hui. “IN FOCUS: The Wage Debate – How to Lift the Salaries of Those Earning the Least?” Channel NewsAsia. Channel NewsAsia, February 3, 2021. https://www.channelnewsasia.com/news/singapore/in-focus-singapore-progressive-wage-model-minimum-wage-13229084.
  11. The most obvious way to test this claim will be to look at the data. However, I was not able to do so as at the time of writing, the data available for the Occupational Wage Survey is not granular enough. Only processed data and statistics (such as median, 25th percentile, and 75th percentile) are published. While I could have looked at the variation in the wages with the above statistics, this data is distorted as the PWM pays older workers more money due to WIS handouts, as covered in this piece. 
  12. Ng, Irene YH, Yi Ying Ng, and Poh Choo Lee. “Singapore’s Restructuring of Low-Wage Work: Have Cleaning Job Conditions Improved?” The Economic and Labour Relations Review 29, no. 3 (2018): 308–27. https://doi.org/10.1177/1035304618782558.
  13. Kenneth, Ler Yong Qin. “Has Singapore Raised the Wage Bar? Impact Evaluation of the Progressive Wage Model.” National University of Singapore. National University of Singapore, November 6, 2017. https://scholarbank.nus.edu.sg/handle/10635/139005.
  14. Ng, Kok Hoe, You Yenn Teo, Neo Yu Wei, Ad Maulod, and Yi Ting Ting. “What Older People Need in Singapore: a Household Budgets Study.” National University of Singapore. National University of Singapore, August 16, 2019. https://scholarbank.nus.edu.sg/handle/10635/157643.
  15. Lim, Jingzhou. “Research into PWM .” Facebook, October 25, 2020. https://www.facebook.com/lim.jingzhou.7/posts/10159297333509645.
  16. Based on figures derived from Mr. Lim’s calculations.
  17. An important caveat to note here is that security workers are however paid more than the figures calculated by Mr. Lim. This is why I have not included his calculations for security workers. The reason as to why this is so is because Mr. Thomas mentioned that by default security guards work 12 hours a shift for full-time positions. Thus, they earn about S$2,000. 
  18. Ng, Irene YH, Yi Ying Ng, and Poh Choo Lee. “Singapore’s Restructuring of Low-Wage Work: Have Cleaning Job Conditions Improved?” The Economic and Labour Relations Review 29, no. 3 (2018): 308–27. https://doi.org/10.1177/1035304618782558.
  19. I’ve included the working hours of these other occupations for a more representative comparison of PWM versus non-PWM industries. Furthermore, I’ve only analysed average working hours for the years 2019 and 2020 for relevancy and also because that is when the PWM came into effect for most of these industries. See Statistical Table: Hours Worked (mom.gov.sg).
  20. Chew, Sophie, and Andre Frois. “What The PWM Could Do That A Minimum Wage Can’t: Make Buyers Pay Fair Prices.” Rice Media. Rice Media, November 7, 2020. https://www.ricemedia.co/current-affairs-features-progressive-wage-model-security-agencies/.

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