Talking a Policy to Death

An Australian friend of mine once remarked - if the Singapore government wanted to do something, it would just announce the policy and get on with it. As Singaporeans would attest to, there is veracity in that statement. At its best, our government is often bold and decisive in implementing policies. The flipside of this boldness and decisiveness is that it will often be criticised for being authoritarian. But we should pause for a moment and reflect on the following question: if boldness and decisiveness are indeed virtues, where does it leave consultation and compromise?

The Importance of Consultation and Debate

Having lived in the UK for seven years, I fully understand the important role public consultation, discussion and debate play in a properly functioning democracy. If a policy affects the livelihoods or the fundamental rights of citizens, it is only right that its rationale be publicly aired and properly debated. There is no running away from the fact that public debate is the hallmark of an open and transparent government.

But as Master Ringisei wryly noted in his recent post, there is a difference between an "open" and "gaping" government. During my years in the UK, I also witnessed first hand how an open-ended discussion could also give exactly the wrong image of the government: one that lacked direction; unsure, dithering and equivocating; losing political capital without making any real policy progress. The end result can be depressing. When the debate is finally over, good policies become watered down and compromised to a point of doing more harm than good.

Compulsory Annuity

I have never made a secret of my enthusiasm for the compulsory annuity scheme (here and here). The economics are compelling: to have citizens pool risks into a national scheme that pays out a small but potentially crucial stipend to the advanced aged. The committee's recommendation is therefore a source of bafflement and disappointment. "Flexibility" and "Compulsory" are not exactly easy bed-fellows.

Emotionally, it does make a lot of sense to return the unconsumed part of the annuity. But it would mean two things. First, the insurance element across citizens would be eliminated, or at least greatly reduced. Second, it will mean that premiums will have to be considerably higher since the national fund would still have to pay out to the families. If everyone can collect (whether dead or alive) whatever he pays in, how does the fund reach a sustainable level of coverage against advanced old age without premiums being bitingly high? There is no escaping from the actuarial reality.

But of course I understand the difficulties faced by the committee - it must surely have tried hard to produce a formula that works while being palatable to citizens. But in trying to make the policy acceptable to everyone, we could well have reduced its effectiveness. After months of deliberation, we are back full circle. Either we make a hard choice or live with an inefficient compromise. It seems like in some cases at least, boldness and decisiveness do have a place above consultation and compromise.