In a departure from the usual state-sponsored message urging Singaporean couples to have more children, this year’s National Day rally addressed the island state’s rapidly graying population. As rising health and living costs emerge as a threat to social stability and economic growth, a dramatic demographic shift is driving the government to re-examine its past anti-welfare stance.
Singapore has one of the fastest aging populations in the world, with over 65-year-olds estimated by 2030 to represent 23% of the population, the second highest percentage in Asia lagging behind only Japan.
If current demographic trends hold, the island state’s median age will rise from 36 presently to 41 by 2030. By 2050, the island state’s median age will rise to 54, leaving only Japan, South Korea and Macau with more elderly populations.
Singapore’s demographic shift has been accentuated by the country’s low fertility rate, which fell to a low of 1.24 in 2004 before rising last year to 1.29. Fewer offspring translates into an increased burden on the young population to provide for their elderly forebears. Health Minister Khaw Boon Wan earlier this year described the changing demographics as a “silver tsunami”.
The government has long enforced individual savings through the mandatory Central Provident Fund (CPF), which mandates that the population saves for old age. More recently the government announced plans to pass a so-called Re-employment Act, which will take effect in 2012 and extend the standard retirement age from 62 to 65.
Nonetheless, a recent survey found that less than 5% of the current elderly population relies on CPF disbursements for their livelihood. Rather, the majority of respondents said they depend mainly on their children. That dependence, however, is straining family ties as average health-care costs rise.
The government has emphasized the role of the family in caring for the elderly, including through the passage of the 2005 Maintenance of Parents Act, which allows parents to sue their children for financial support. Applications at the Tribunal for Maintenance of Parents hit a nine-year high last year.
Over the past 12 months, some 172 senior citizens have filed applications against their children, up substantially from the previous annual rate of around 100. Still, Geylang East Home for the Aged, a shelter for elderly people abandoned by their family, said that its 37-bed home is always full. Abandoned parents who can no longer fend for themselves are often recommended by social workers.
The generational conflict is being driven in part by spiraling health costs. In 1984, Singapore’s government covered about three-quarters of national health costs. That burden shifted when the government introduced medical saving accounts which required individuals pay their own way.
Health care now accounts for 4.5% of Singapore’s gross national expenditure, one of the lowest such percentages in the world. A research report by Nanyang Technological University’s David Reisman showed that 36% of health-care expenditure was government financed in Singapore in 2007, comparable to the percentages of much poorer Indonesia and economic basket case Zimbabwe.
With the growing number of senior citizens and cash-strapped children who are unwilling or unable to shoulder the burden, the Singapore government will find it difficult not to bear more of the costs, according to Reisman.
In Organization of Economic Cooperation and Development (OECD) countries, around 80% of health care expenses are covered by public spending, mostly through subsidies to public hospitals. That figure stands at 85% in Sweden and the United Kingdom, 81% in Japan and 45% in the United States, which is now grappling with a controversial reform plan to provide universal healthcare coverage.
Member of parliament Paulin Tay-Straughan was quoted in the local media saying that spiraling healthcare costs could potentially be a major strain on the Singapore government’s resources. “If [individuals] don’t have adequate coverage, there will be a tremendous strain on subsidized care which will drain revenues from the state,” she said.
Singaporeans are hospitalized on average 11 times through their lives, with eight of those visits occurring after the age of 55. Older persons suffering from chronic degenerative diseases and non-communicable disabilities are more likely to be “bed-blockers”.
Even when individuals can pay, there is a chronic shortage of beds in hospitals, with average waiting times of four to eight hours before patients are admitted, say sources. The government is encouraging more home care, but there is a shortage of doctors willing and able to do emergency house calls, industry experts say.
The mounting crisis has spurred some creative – and controversial – thinking. The government in recent years launched a national elderly long-term care severe disability insurance (LTCDI) scheme, known as Eldershield, to protect its citizens against severe disability. Although not overtly referred to as welfare, new government support measures have quietly been implemented to assist the elderly, including the Workfare Income Supplement and other healthcare subsidies.
In February, Health Minister Khaw drew flak when he suggested Singapore consider moving its elderly residents across the causeway to the neighboring Malaysian city of Johor Bahru. He estimated that for the cost of establishing a polyclinic in Singapore a 200-bed full service nursing home could be built in Johor Bahru.
“Of course many [family members] visit [their parents] daily, but quite a significant number visit only during the weekends. So what is the difference in putting them in Johor Bahru?”
Moving patients to Malaysia would also address the island state’s acute shortage of health-care specialists in palliative care and geriatric-related fields, which in recent years has compelled hospitals to import nurses from China, the Philippines and even impoverished Myanmar. Some say Singapore’s health-care crisis comes down to culture and changing generational priorities.
In the Philippines and Thailand, children, particularly women, are expected to care for their parents when they reach old age out of a debt of gratitude.
“We cannot legislate love,” Minister of Community Development, Youth and Sports Vivian Balakrishnan recently told parliament. “But we know that a small minority will need help and we will ensure that help is available… Those contemplating abdicating responsibilities will know that the system will catch up with you.”