Asia Spending Too Little on Poor
Asia, predominantly consisted of developing nations are experiencing rapid economic growth in the past decades. However, for the majority of the population, quality of life have not improved accordingly. In most countries, social security policies are under-budgeted which could be used help the lower-income, unemployed, elderly, or those stricken by natural disaster. As one of the most developed nation in the region, Singapore still fell behind on social protection spending. Combined with rapidly aging population, Singaporeans have the highest savings rate in the world. Fearing that the government will not be able to help them in the future ...view middle of the document...
Singaporeans do enjoy a currently well-funded social-policies that enables them to achieve high level of education. As well as having amongst the highest health status and rate of home ownership (Quasem 2013).
As the economy grows, on average, the population are becoming wealthier. But in consequence, the wealth will not be distributed equally. The wealthy tends to become wealthier at a much higher rate than the less-wealthy population. This brings to the case of economic inequality, which is the disparity on the ownership of wealth amongst the population (Sloman 2008). The problem lies where a portion of the population doesn’t have access to social insurances benefits. A particular group that is in this pit are the low-income and self-employed, which is also referred as the “missing middle”. These people could not receive insurance benefits like those who are working in public or large private firms. Also, they are not poor enough to be eligible for handouts. As a consequence, this group retains high savings rate, fearing that the government will not be able to help (Quasem 2013).
Given the current social policy in Singapore, only 3.5% of its GDP is spent on this policy. It lacks behind other high-income Asian nation such as Japan and South Korea, which spends 19.2% and 8% on social policy respectively (Quasem 2013). With the growing number of “missing middle” population, the government have been criticized on its fiscal policy. In this case, it is the usage of government expenditure and taxes to stimulate macroeconomic interest. The government are also requested to reconsider its subsidy, what the government give back to the consumer households (Parkin 2010). Another group of population in need, adding to the “missing middle”, are the elderly. Singapore’s self-reliant aging population is increasing at high pace (Quasem 2013). With the current policy, the elderly would not be able much from the government’s policy.
With the current fiscal policy, a large portion of the population will not be able to receive any benefits from the government. Based on current fiscal policy, the government is lagging behind. With the current rate of population aging, individuals and families how are self-employed are going to be a victim, along with soon-to-be pensioners who are not earning enough. Also, the high...