Channel NewsAsia
Updated: 03/06/2013 02:24 | By Channel NewsAsia

Government responds to population paper by Workers’ Party

Government responds to population paper by Workers’ Party

Government responds to population paper by Workers’ Party

SINGAPORE: The Singapore government has issued its response to the Population Policy Paper released by the opposition Workers’ Party on February 23.

It said if a realistic adjustment is applied to the Workers’ Party’s projections, the population would in fact go up by more than 200,000 and go beyond six million in 2030.

The WP’s paper had sketched out a projected population of about 5.8 million by that time.

The government said one of the main differences is that the Workers’ Party assumes a higher mortality rate and lower life expectancy of the citizen population.

This could underestimate both the size of the population and the number of elderly in the population.

This in turn, it said, would have implications on the dependency ratio — that is, the number of worker adults supporting the elderly.

The assumption would also affect Singapore’s social and health services needed.

The government added that the WP’s assumptions on labour force participation rates (LFPR) are also much higher than what’s achieved by advanced developed economies with the highest LFPR today, and may not have taken into account the effects of our ageing population on LFPR.

It said there may be a need to make up for a 100,000 shortfall in the workforce if the party’s projected labour force participation rate is not achieved.

The WP, it said, could also have underestimated the economic impact of its proposal to freeze the foreign workforce growth.

They project a 0.5 per cent per year difference in GDP growth between their proposal and the government’s. Abruptly closing off foreign worker inflows could disrupt the economy.

It said the net result could be much lower productivity and GDP growth than that assumed, and that the risk of a contracting economy is much higher.

And this, said the government, could impact wage growth and job opportunities.

"Until our TFR improves significantly, the immigration rate of 10,000 SC per year proposed by the WP does not replace the citizen population, and will result in a decline in the citizen population from 2030," it said.

The Workers’ Party released its own paper on population, just two weeks after Parliament endorsed the Government’s report charting the country’s strategies to mitigate an ageing and shrinking population.

Titled ’A Dynamic Population for a Sustainable Singapore’, the Workers’ Party makes a case for a population projection of about 5.8 million by 2030 — down from the 6.9 million in the government’s White Paper.

And the projection comes with an annual resident workforce growth of 1 per cent, a freeze to the foreign workforce growth rate, and a projected GDP growth of between 1.5 and 2.5 per cent in the next decade (2020—2030) — half a percentage point down from the government’s GDP projections.

But like the government, the Workers’ Party also believes in a strong Singaporean core. It disagrees, however, on how to sustain and nurture this core.

— CNA/de

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