Singapore’s Lee Increases Social Support Ahead of Elections

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Singapore Prime Minister Lee Hsien Loong pledged more social measures including making public housing more affordable, as the city readies for elections.

“Soon, I will be calling elections to ask for your mandate to take Singapore into our next phase,” Lee said in a televised speech at the National Day Rally on Sunday as the country celebrated its 50th year of independence this month. “Singapore is at a turning point.”

Lee’s ruling People’s Action Party -- founded by his father and former prime minister, the late Lee Kuan Yew -- is managing issues from rising costs to increasing frustration among citizens against an influx of foreign workers. The PAP in recent years has sought to shore up support among voters by boosting spending on lower-income families and the elderly after losing some districts in the 2011 ballot.

The election comes as Singapore’s export-dependent economy has been hurt by slowing growth in China, with uneven recoveries in the U.S. and Europe damping demand for Asian exports. The government slashed the upper end of its growth forecast for 2015 after the economy shrank last quarter, predicting an expansion of 2 percent to 2.5 percent this year.

“These are goodies ahead of an election,” said Song Seng Wun, an economist at CIMB Private Banking in Singapore. “While these are populist policies, they continue to underscore the message of restructuring the economy as these policies ultimately help shape the economy in the longer run.”

‘Critical’ Election

Lee, 63, called the upcoming election “critical” as it will allow him to choose the team that will lead the country for the next two decades. The elder Lee, who was prime minister from 1959 to 1990, died on March 23.

The election may be the first in which every parliamentary seat is contested in the biggest challenge to the ruling party since independence in 1965.

The celebrations around the milestone national day and the mourning of the death of the elder Lee, whose funeral drew more than 100,000 people in heavy rain, may boost the victory margin for the ruling party, said Kishore Mahbubani, dean of the Lee Kuan Yew School of Public Policy at the National University of Singapore. Still, the PAP faces an increasing number of younger voters who want a bigger opposition representation in Parliament.

‘Political Uncertainty’

“There’s some degree of political uncertainty in Singapore that wasn’t there,” Mahbubani said in a Bloomberg Television interview with Haslinda Amin Monday. “The good thing about this election is there will be more potential leaders emerging.”

The prime minister announced plans to boost grants to make public housing, where more than 80 percent of Singaporeans live, more affordable. He said he will also raise the household income ceiling for new apartments to S$12,000 ($8,488) from S$10,000 to ensure homes are within reach of more Singaporeans.

“We don’t want anybody to be left behind,” he said.

The premier said the government will raise the employable age to 67 from 65 as Singapore copes with an aging population. He will also help offset child-rearing costs and double paternity leave to two weeks, with the extended time off paid for by the government.

Lee warned that while immigration was “one tough issue” which Singaporeans have strong views on, the city’s economy will suffer if foreigners aren’t allowed in.

The government has clamped down on foreign labor, in part because of discontent over congestion, rising property prices and competition for jobs. The slower inflow of cheaper overseas workers has resulted in a labor crunch that has raised business costs.

“There are no easy choices,” Lee said. “Whichever option we choose, it will involve some pain.”

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