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Singapore Government

The Ageing Asia Investment Forum

The Ageing Asia Investment Forum

Distinguished Guests,

Ladies and Gentlemen,

Good Morning. Thank you for having me here today and it is my privilege to share some of my thoughts on ageing - something that is very close to our hearts. This is also the challenge which many countries will be facing in the coming years, particularly in societies like Singapore, Hong Kong, Japan, China and many other Asian countries.

Let me also congratulate the organiser for putting this event together, because despite the fact that we are from different countries, with different local contexts, I think there are many things that we share. There are many ideas that we can share, which can then contribute to the cross fertilisation of ideas across different societies, so that we can seek better solutions to deal with the challenges ahead of us.

Ageing population is not a crisis if we prepare well for it

Many people have used the term “Silver Tsunami” as if there is an upcoming disaster. My first point is - ageing or an ageing population is not a crisis if we prepare and we prepare well. In fact, savvy businessmen will always say that the circumstances are always neutral; whoever masters the circumstances well will conquer the market.

For the pessimists, there will always be problems amidst opportunities. For the optimists, there will always be opportunities amidst challenges. So I think we should take an optimistic view towards the challenges we face today. Indeed, there are many challenges facing the ageing population, including financial security which inevitably will revolve around housing and medical issues. This is the hard part of it – the hardware: how do we design our social security system, how do we reinvent our healthcare system and housing system such that we provide  peace of mind for our elderly who have contributed significantly to the economy and to the society,  for them to grow old in peace and with dignity.

But beyond the hardware, there’s also the software portion that we need to look into, including our social architecture: how we organise our society, how we organise the healthcare system, how we organise the resources amongst us to bring forth the desired outcome we want for our elderly in the community.

But most importantly, beyond the hardware and the software, it has to do with the heartware. It is also an opportunity for the whole society to come together to demonstrate that heartware – H-E-A-R-T-W-A-R-E – the heartware – for us to show the love, concern for our elderly, because what we do today will be an example for our children, for the next generation.

The question is: can we overcome all these challenges? I’m sure we can. And I’m quite confident we will. Because we have many good ideas out there that we can learn from and apply to the local context.

In Singapore’s short history, we have talked about this issue for quite some time, even before the issue of the ageing population became common parlance in our lingo. Many years ago, when we designed our housing system, we asked ourselves: how can housing be more than a roof over the heads? Housing can also be an option for our people to grow old in a dignified way where they can actually use their housing as a form of investment, a form of future cashflow. This has to be closely designed into our housing policies right from the beginning.

Likewise, in medical care, we have to ask ourselves: how do we balance the role of individuals’ responsibilities with, perhaps, another concept of societal risk pooling?  I know many societies are very concerned with the moral hazard of funding medical healthcare through a buffet system. And many countries may shrink to the one extreme or the other. Either they have the entire free market system whereby individuals care for themselves on their own, or they have another extreme whereby everything is pooled together causing moral hazards within the system.

Our challenge is not to go for either extreme. Our challenge is to identify those areas where we can best encourage individuals’ responsibilities towards their own healthcare and well being – at the same time, identify areas which the market may not work so well, and to move into a concept where the society pulls the risks together to take care of each other. The challenge is to find out which part of the healthcare system, which part of the medical system, falls into which category.

Not all social services need to be provided for by the government

Moving on, I would like to talk about something that is always close to my heart – as with all things in this sector, not everything needs to be provided by the government. In fact, the government may not be the most suitable provider for many of the services which we are talking about, thus we should leverage on three respective strengths, the government, the private sector, and also the people sector.

For the government, we know that generally, governments are good at providing large-scale, basic and homogenous products and services for the people. That is the strength of the government. On the other hand, we know that the strength of the private companies lie in them being hardnosed about their financial discipline. They are also very innovative, because the market drives them to be so. Yet at the same time we should also not ignore the efforts of the people sector, where they can mobilise local resources from the community to develop local solutions that are best suited for their respective communities. So it is with this philosophy of what we call the ‘3P model’ - the public, private and people sector. I think, this model is the best way for us to move forward.

Again, the challenge for us is not so much on the concept of the 3P model. The challenge for us is to identify which areas would be best provided by the government vis-à-vis the private sector and the people sector. To not leverage on the strengths of the respective sectors would be a missed opportunity for us.

But we must also distinguish between social services and social assistance. Not all social services need to be provided by the government. In fact, there are many social services across the entire spectrum that can be easily and better provided by the private sector.

Social assistance is different. Social assistance is something which perhaps the market will not work with because the market will not provide solutions when people cannot pay. This is the area where we need innovation and this is the area where we need the government to come in. But other social services can be provided by the private sector and we should leverage on this. Some examples include how we promote the concept of a retirees’ village, which is a big project.

But beyond the big retirees’ village project, are we able to have smaller, more localised community homes where people form small little communities to share their resources and help care for each other? We should not look at the model whereby the elderly are seen as people with needs but without capabilities. Actually, each and every of our elderly has his and her respective capabilities that we should harness, and  bring forth  so that they can not only take care of themselves but also  have meaning in their lives, by providing care for their fellow men.

This is something that we have tried in Singapore – small projects like our Senior Group Homes, where we encourage small groups of elderly to come together and to live together. We found is that such a concept goes beyond economic benefits. The benefits also include the social interaction of our seniors, their sense of purpose in life, where our seniors feel that they are not just dependent on the society to care for them, but at the same time, that they too can contribute to the well being of their fellow men. That is important, perhaps even more important than the economic benefits of having each of them taking care of one other.

The concept of insurance pooling for the eldercare sector is also another growing industry. We should continue to innovate and develop new models to see how we can fund such services because if we do not, then we will actually miss an opportunity to tap a very good market mechanism. We should see how we can pool society’s resources together, to care for those stochastic events that have great impact on the individual’s life, but for which each individual may not be able to cater for and insure against.

So, not all social services need to be provided by the government. We should leverage on the strengths of the respective private and people sectors.

Government’s focus on social assistance

Finally, on social assistance, this is an area that the government has to focus on because it is an area where the market solution is unlikely to work. In the area of social assistance, all societies must come to their own respective conclusions about how they want to care and share with their fellow residents.

In Singapore, our philosophy is - we will always to provide more for those with less, given our finite pool of resources. Because this is our underlying philosophy, to make sure that we stretch each and every single dollar, each and every resource we have, to the maximum.

If we do not do that and we just do it equally for everybody, that may also not be the best way to care for all our elderly. Because different groups of elderly have different needs and they also have different perspectives of how they want to be cared for. So as they say, different strokes for different folks. And this is something that we hold close to our hearts - while we provide the baseline care for all our elderly, there will be some in certain niche groups that will require more. And this is where we need to channel more resources. And this is where the society has to come together and develop their consensus and their social compact of what we call the required hardware, whereby we must all agree, that in a society with finite resources, those of us with more must give a helping hand to those with less. Only so can we build forth an inclusive society, a warmer society that we can all be proud of.

This is something we will continue to work on. Again, the challenge is not just about the theory; the challenge is really about identifying the areas that we need to provide baseline services on a macro scale, as well as the services that we really have to zoom in and provide more for those with less.

It is not an easy challenge because many societies are still grappling with this issue. Many societies are debating amongst themselves over who should get more and who should get less. If we do it well, we have an inclusive society. If we do not do it well, society can break up and you can have an acrimonious debate throughout and yet very little is actually being done for the society itself.


So on that note, I look forward to your discussion, your contribution and your ideas. I look forward to the innovation that you will develop not just in the hardware but the software and also the heartware. How we can develop better solutions in terms of housing, transport, medical care for our people? How do we organise ourselves and mobilize the resources of the community? How do we organise the entire social compact in our society to come forward and share the same perspective- that we must help those with less, more than the average.

To conclude, I do not see ageing as an issue or a crisis, if we prepare and prepare for it well. I do not think that we should only look to the government as the only solution provider. In fact, in this conference, you will see that there are many innovative private and people sector solutions that we should leverage on. We need the entire society to come forward and embrace the 3P framework of public, private and people sector initiatives. Only so, can we leverage on the entire resources of the society to do good for our people. Finally, the government must focus its efforts on the areas where the market is unlikely to do well, and instead allow the private sector and the people sector to do those things that they already have a natural advantage too. Ultimately, society must agree on how we allocate the finite resources to help as many people as we can, how we as a society come together to put forth a proposition that while we have a baseline service for everyone, we must invest more resources to those who are more needy, to those who need a bit more help than the rest of us.

So on that note, I wish you a very successful conference and I look forward to hearing your ideas in the coming days.

Thank you very much!

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