G3

Tax Report

Group Members:

Lynette Cheah Xin Yi

Lim Chuan Ming

Lee Min Jie

Ang Wan Xin

CONTENT PAGE
1.0 Executive Summary ........................................................................................................................................ 3
2.0 Introduction..................................................................................................................................................... 3
2.1 Agenda and scope ....................................................................................................................................... 3
2.2 Approach of the report ................................................................................................................................ 6
3.0 Analysis of the current situation ..................................................................................................................... 8
3.1 Singapores TFR declines over the years .................................................................................................... 8
3.2 Significant events effects on number of births............................................................................................ 9
3.3 Cost of raising children ............................................................................................................................... 9
3.4 Educational level....................................................................................................................................... 10
3.5 Career aspiration of women and late marriages ........................................................................................ 12
3.6 Alternative career path .............................................................................................................................. 13
3.7 Available reliefs to offset cost of raising children in Singapore ............................................................... 15
3.8 Conservative approach taken by government on reliefs ........................................................................... 16
4.0 Pointers to address the current situation ....................................................................................................... 16
5.0 Proposal set ................................................................................................................................................... 17
5.1 Regarding income wage gap ..................................................................................................................... 17
5.2 Regarding TFR ......................................................................................................................................... 17
5.3 Comments on proposal set ........................................................................................................................ 17
6.0 Alternative proposal set ................................................................................................................................ 18
6.1 Regarding income wage gap ..................................................................................................................... 18
6.2 Regarding TFR ......................................................................................................................................... 18
6.3 Comments on proposal set ........................................................................................................................ 18
7.0 Limitation of the proposals ........................................................................................................................... 18
8.0 Conclusion (need this?)................................................................................................................................. 19
9.0 Appendix....................................................................................................................................................... 20

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1.0 Executive Summary

2.0 Introduction
Singapore has come a long way since gaining independence from Malaysia in 1965 to become
one of the most competitive country in the world today. The efforts by the government over the
past decades to spearhead investments drive; improve education system; developing human
capital and other myriad of prudent policy implementation had propelled the city-state into one
of the most open economies in the world; least corrupt and most pro- business.
Despite Singapore being renowned around the world for many different reasons, such as having
topped the list among other countries for having the best health and living standards. 1 While its
accomplishments have been extensively publicized, its shortcomings too have been widely
discussed on the world stage, like its low Total Fertility Rate (TFR) as well as widening income
gap.
Singapore has been identified to have one of the fastest greying populations in the world. In a
short span of 15 years, Singapore has been predicted to experience a 97% increase in its
population aged 60 years and above.2 Furthermore, its old-age dependency ratio has been
predicted to decline from the current ratio of 5.4 to a mere 2.1 in 20303. This phenomenon has
been attributed to the nations low TFR, which is one of the key issues the government is
determined to tackle.
The other key issue the government aims to resolve is the nations growing income gap.
Singapore has been flagged as one of the most unequal country in terms of income. 4 This is an
issue that is of great concern among Singaporeans.
2.1 Agenda and scope
The potential scope of tackling the issues of TFR and the nations growing income gap can be
quite wide - touching upon various aspects of society such as different age groups and education
level. To better illustrate our recommendations, the report will mainly focus on the issues
pertaining to having; bringing up and ensuring that children in Singapore will have a fighting
chance to achieve their future aspiration and not being trapped into the same path that serves
only to fuel the low-income gap problem, years down the road.

Causes of Dropouts
1
http://www.straitstimes.com/singapore/health/singapore-among-top-countries-in-un-health-and-
living-standards-list
2

http://www.un.org/en/development/desa/population/publications/pdf/ageing/WPA2015_Report.p
df
3
http://www.nptd.gov.sg/portals/0/news/Occasional%20Paper%20-
%20Citizen%20Population%20Scenarios.pdf
4
http://www.economist.com/news/special-report/21657611-we-dont-them-much-rich-are-
always-us
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It is crucial to analyze the reasons why students halt studies and while proposing strategies to
ensure that all children receive education, at least up to O Level and equivalent, address the
difficulties that these children might face. This process can be complex as we are looking at
individuals with different mindsets while in varying circumstances. However, we propose the
problem be addressed by taking on two perspectives, the individual perspective and the
institutional perspective.

Individual perspective

This framework analyses the traits of the child, which include personal values, attitude towards
education and behavior in schools, and determines how such traits might contribute in the
decision of the child to withdraw from school. This framework is extended to encompass two
concepts, the student engagement and educational achievement.

Student engagement includes academic engagement and social engagement, which can both be
displayed through the childs attitude and behavior. A child who finds it difficult to fit into the
traditional education structure might become disinterested in learning and academically
disengaged. Furthermore, a child might feel out of place in school if he or she is unable to get
along with others in school.

The educational achievement of the child can affect his or her decision to withdraw from school
as well. The reasons behind why a student child attributes to low academic achievement (below
average examination and test results), educational instability (interruption to studies) and low
educational attainment.

Institutional perspective

Under this framework, we considered three broad factors: family factors, school factors and
community and peer groups. A childs behavior and attitude towards education are strongly
influenced by the environment that he or she is in. His or her personal values might even be
affected by the way their parents brought them up.

1. Family factors

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Family background plays an extremely important role in determining the form of education a
child will receive and his academic achievements. When looking at family background, we
considered the socioeconomic status of the family, which includes main indicators such as
parental education and income.

Parental education focuses on how a child might be brought up, which is strongly influenced by
the education level of the parents. Families with strong educational backgrounds will understand
its importance and value, and thus, encourage children in the family to pursue studies.
Moreover, parents with higher income are also more likely to prioritize and allocate larger
amounts of resources for their childs education. This can include sending their children to better
quality schools and even hiring external tutors to help them with studies as well. Lastly, focus
should be placed on relationships between parents, children and the school. It ought to be done as
studies have shown that children whose parents keep watch on their school activities and
regularly show emotional support have a lower probability of dropping out.

In conclusion, students are more likely to drop out of school if their parents underestimate the
importance of education and are not concerned with their activities with regard to school.
Students coming from low income households may also feel the need to stop studying and
support their family.

2. School factors

A school can influence the performance of a child through its practices and policies.

3. Peers

A student who associates with the wrong company could be exposed to negative peer influence
and in most of these situations, be convinced that studies is of minor importance. It has been
reported that the social composition of students within a school can affect its student
achievements as well. Thus on the flip side, a student with friends who value studies is most
likely to do the same.

Applying this to Singaporean context, some students find it difficult to cope because of their
weak academic foundation or difficult personal or family circumstances; while others lose

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interest in their studies because of a lack of positive peer and family influence, a lack of
motivation, and the availability of job opportunities elsewhere.

2.2 Approach of the report

The issue of wages, childbirth and childcare are deep rooted and cannot be solved by adopting
more or improving tax policies alone.

Assuming that people are rationale and claimant of tax incentives are mostly by Singaporeans.
The recent YA 2015 reliefs and allowances for taxable individuals shows that only 444,477
claimants took up any form of child relief against their assessable income. This only represents
about 30% of the eligible age group of both male and female Singaporeans from the age group of
20-445.

This shows that although tax policies are well intended, it tends to only incentivize certain
groups of people that pays taxes, thus have assessable income to offset. However, efforts to
resolve the low TFR and low income gap requires a much broader approach to engage more of
the population. Therefore, the recommendation will expand from just tax-related to other broad
based approaches in a concerted manner to help meet the goal of narrowing the income gap and
achieve higher fertility rate in the near future.

To approach our topic, our group attempted to profile the average Singaporean family, according
to the household income as well as number of children within the family. This is done so as bring
our analysis of the issues closer to reality, to reflect the situation faced by families today.

In doing so, we would profile three different types of families in our report. Firstly, the average
Singaporean family, followed by a low income family, as well as our interpretation of a young
Singaporean family.

Average household income published by the Department of Statistics Singapore6 for the year
2015 was $8,666 including employer CPF Contribution. For our analysis, we will be using the
take home pay of the average Singaporean family to account for expenses related to raising a
child and education.

5
Computed using data obtained from IRAS.gov.sg and Singstat.gov.sg
6
Key Household Income Trends, 2015

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In 2015, the average and median monthly household income from work per household member
amongst resident employed households were $3,624 and $2,500 respectively. After deducting the
employer and employee CPF contributions, we can find the average take home pay for
Singaporeans in the year 2015.

Monthly Income
Monthly Income
from Work per
Percentile from Work per
person (before
person
taking out CPF)

1st to 10th 541

11th to 20th 1040

41st to 50th 2,274

91st to 100th 12,816

For the lower income families, we will be using the lowest 20% percentile as an estimate.

In addition, we also found the average income of a young Singaporean family that is likely to
face the bulk of the costs of education. From the same data, we can also see the number of
families headed by Singaporean citizens or Permanent Residents of different ages. We decided to
use the age groups 30-39 and 40-49 as a gauge for younger Singaporean families with children
still in education.

In summary, the approach of this report aims to review the current measures that have been
implemented to tackle these two key issues. This will be followed by an analysis of the
implemented measures to identify the areas that can be improved on. After which,
recommendations will be made to suggest either amendments to the existing measures or new
policies that should be executed to complement those already in place.
As only publicly available information are gathered and analyzed, this could lead to a problem
where it may not be comprehensive or detailed enough to support our analysis. Should there be
details that are not publicly available, assumptions will be made to bridge the gap.

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3.0 Analysis of the current situation
3.1 Singapores TFR declines over the years

Figure 1. Singapores Total Fertility Rate over the years7

Singapores TFR has declined from 1.20 in 2011 to 0.89 in 2016.8 While the TFR of 0.89 for
2016 is merely an estimate, this decline is alarming, especially since the government has
implemented a slew of policies to tackle Singapores low TFR ever once it was identified as an
issue the country was facing. The policies legislated corresponds to the six goals the government
has set to increase Singapores TFR; Getting married, setting up a home, procreation, raising and
caring for children, supporting work-life balance and encouraging shared parental responsibility.
The following are the different types of policies that have been implemented to achieve those
goals9:
1. Tax reliefs; Working Mothers Child Relief etc.
2. Rebates; Parenthood Tax Rebate.
3. Subsidies; Enhanced Subsides for Centre-Based Infant & Child Care etc.
4. Cash gifts; Enhanced Baby Bonus etc.

As a whole, the various policies were implemented to with the main objective of addressing the
concerns Singaporeans had about the high costs of bringing a child up in Singapore. The
government had hoped that by helping to relieve part of the heavy financial burden of raising a
child, more couples would have the means to raise an additional child, hence encouraging
couples to have larger families.

7
https://data.gov.sg/dataset/births-and-fertility-annual?view_id=5f717cb2-e2dd-4607-bb74-
f80a4c432db8&resource_id=f63d5535-f094-42d0-b7ff-dbcbccb97928
8
https://www.cia.gov/library/publications/the-world-factbook/fields/2127.html
9
For a comprehensive list of policies implemented, refer to appendix.
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3.2 Significant events effects on number of births

Figure 2. Changes in Singapores birthrate corresponding to significant events10

Since the implementation of the various policies, there has been the occasional spiked increase in
the number of births per year over the years. This could be attributed to other factors, such as
2012 being the Year of the Dragon and 2015 being Singapores Jubilee year, rather than the
effectiveness of the implemented measures. The nations TFR has continued to consistently
hover around the range of 1.2, despite government intervention through the implementation of
the abovementioned types of policies, which perhaps hints at the ineffectiveness of the current
policies in resolving the issue of Singapores low TFR.
3.3 Cost of raising children
While the cost of raising a child is a very pertinent factor that Singaporeans consider while
contemplating having a child. Currently, the cost of raising a Singaporean child from childbirth
to 20 years of age is estimated to range from around $200,000 to as high as $1 million. The
middle-range average is around $360,000. The cost can be broken down into the following:

Pregnancy and Delivery

The parents will incur expenses when they pay the doctors visits and delivering their baby in the
hospital. The fees in this aspect vary from about $4,000 to higher than $20,000. Some of the
schemes that have been put in place to ease the burden of parents include the Medisave
Maternity Package and Enhanced Medisave Grant for Newborns.

Daycare and Kindergarten11

10
http://www.singstat.gov.sg/statistics/visualising-data/storyboards/population-trends
11
https://www.childcarelink.gov.sg/ccls/uploads/ECDA_KiFAS_brochure.pdf
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According to the Early Childhood Development Agency (ECDA), over 99 per cent of children
attend preschool for at least one year. ECDA reports that the monthly fee for the full-day
programme is at an average of $1,004 to more than $2,000 per month. However, there are
subsidies available to families with lower income. The Kindergarten Fee Assistance Scheme
(KiFas) is put in place to ensure that children from the low and middle income families This
scheme provides assistance up to 99% of the fee depending on the monthly household income.

Primary School and Secondary School

The school fees at the primary and secondary level are generally low. However, parents need to
pay for their children's uniforms, transport, school activities and even tuition fees, The cost of
putting a child through primary and secondary school can average from a few thousand dollars to
more than $100,000.

Tertiary Education
The annual school fees are estimated to be $17,000 and might increase in the future. If parents
were to send their children to university overseas, the fees could go up to $500,000 a year.

However, the costs presented above depend on the income of parents, lifestyle, family support
given and the schools attended. Thus, the absolute value may vary accordingly.

3.4 Educational level

3. Highest educational attainment

We extracted the data for the highest qualification attained for Singapore residents aging from 25
to 29 years old and found that the percentage of these residents who did not attain at least
secondary level of education was around 0.05%.

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University Education

Currently, university education in Singapore is a highly sought after goal of all Singaporean
parents and children alike. At a Cohort Participation Rate of 26%12, approximately 1 in every 4
students in a Primary One cohort will enter one of Singapores six universities. This is especially
important as university education is one of the major indicators of social mobility, as the average
person will receive a 46% premium in wages13 upon entering the job market with a degree as
opposed to another who does not have.

However, costs to enter university are significantly higher than formal education up till
pre-university. These costs usually form the majority of the amount parents spend on
their childrens education, as tuition fees rise steeply at this level. In the table below, we
have listed the tuition fees per annum for each of the six universities in Singapore. [Pie
chart showing university education amount compared to the rest]
University Tuition Fees p.a. Financial Assistance

National University of
8,050
Singapore (NUS)

Nanyang Technological 8,050

12
From Ministry of Educations website
13
A survey conducted by management consultancy Hay Group of 95 organisations here found that employers are likely to pay up to
46 per cent more in starting salaries for degree holders than for diploma holders.
(http://www.haygroup.com/sg/press/details.aspx?id=44188)

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 University (NTU)

Singapore Management
11,300
University (SMU)

Singapore University of
Technology and Design 12,400
(SUTD)

Singapore Institute of
7,980 (estimate)
Technology (SIT)

Singapore Institute of
10,500
Management (SIM)

Despite this, there are many whom are unable to complete their university education. Dropout
rates in tertiary education stands at X%, of which Y% is due to financial issues. Not withstanding
financial burden alone, the opportunity cost of studying as opposed to working weighs heavily
on lower income families as well. As university education becomes an increasingly expensive
endeavor, it is imperative that children are given equal opportunity to complete their university
education regardless of their background and familys financial ability.

2. Dropout rate and current measures

In the last five years, the overall dropout rate at the secondary level of each Primary 1 cohort was
1%, a low proportion. Agencies have already been established to provide support to children who
are unable to fit into the education system. Additionally, the already put in place Time-Out
programme identifies students at the risk of quitting school after which the school counsellors
and teachers will seek ways to motivate these children to continue being engaged in studies

3.5 Career aspiration of women and late marriages

What the government has neglected to address is mentality that Singaporeans have with regards
to marriage as well as the change in their aspirations. Over the years, the role that women hold in
society has transitioned from a domestic capacity to one where they play an active part in the
countrys economy. This transition occurred as women became increasingly educated. In 1995,
the female-to-male enrolment ratio for higher education, such as a Masters degree, was merely
37 females per 100 males attained.14 In a short span of 10 years, the number has almost doubled

14
http://www.singstat.gov.sg/docs/default-source/default-document-
library/publications/publications_and_papers/education_and_literacy/ssnmar16-pg7-11.pdf
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with 71 females per 100 males being enrolled for higher education15. As such women were no
longer content with conforming to the societal norms that dictated that they were to be a
homemaker and care for their children.16 Women began exploring the employment opportunities
offered to them, thus liberating them from their financial dependence on men and altering their
aspirations over time.
As women began focusing on the opportunities afforded to them through education and their
careers, therefore they delayed their plans for marriage and parenthood. This resulted in the shift
the mentalities Singaporeans had towards marriage and parenthood. The median age of a first-
time bride has increased over the years, from 23.1 in 1970 to 28.2 in 2015.17 This has in turn
affected Singapores TFR as the median age for a Singaporean women to have a first child was
30.3 in 2014.18 Since the chances for women to conceive decreases as once they hit their 30s,
naturally Singapore has a low TFR brought about by women marrying at a later age to fulfill
their career aspirations. Hence the slew of policies implemented to tackle Singapores
persistently low TFR, addresses the issue of the high cost of raising a child but fails to resolve
the root cause of the problem; the shift in Singaporeans mentality on marriage and parenthood.
3.6 Alternative career path
Vocational Education

While the Ministry of Education acknowledges the limited number of places in university, it is
important to note that increases in the number of university places will have to be sustainable and
supported by the economy. Increasing the numbers too quickly can lead to an excessive supply
of university graduates in an over saturated job market. Therefore, there arises a pertinent need to
ensure education policies are closely aligned with the distribution of vacancies within our
economy in order to ensure that our citizens enjoy good employment outcomes.

To tackle this issue, the government has also been actively promoting vocational
education as an alternative route, as well as exploring new ways for working adults to
continue their education. Other than obtaining a university degree, citizens can choose to
go for other routes of education such as shorter diploma courses, as well as courses
available to supplement their knowledge in the workplace.

This deviation from formal education rests on the governments efforts in promoting
vocational training, both in students as well as working Singaporeans. Having introduced
SkillsFuture, the government aims to develop skills for the future as well as help

15
http://www.singstat.gov.sg/docs/default-source/default-document-
library/publications/publications_and_papers/education_and_literacy/ssnmar16-pg7-11.pdf
16
http://www.ipss.go.jp/webj-
ad/webjournal.files/population/2012_Vol.10/Web%20Journal_Vol.10_05.pdf
17
http://www.singstat.gov.sg/docs/default-source/default-document-
library/statistics/visualising_data/marriages-and-divorces-2015.pdf
18
http://www.straitstimes.com/singapore/singapore-population-report-10-things-to-know-about-
citizens-prs-babies-and-more
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 Singaporeans build up skills based knowledge to help in their employment. Aimed at
Polytechnic and ITE students, as well as adult learners, this policy aims to shift the focus
of education on university education to one that deepens Singaporeans skills in the
workplace.

Policies such as the SkillsFuture Earn and Learn Programme aims to help Polytechnic
and ITE graduates to assimilate into the job industry related to their discipline of study.
On-the-job training and mentorship are some of the key features that collectively aim to
help them achieve industry-recognised certification. The implementation of such a plan
ensures that students who do not eventually move on to university are also entitled to a
well-structured career ahead of them in the industry they choose to work in.

Furthermore, with regard to working adults, the government has introduced about 300
skills-based modular courses in partnership with local universities and polytechnics in
2015, and set to expand even further in 2016. Apart from ensuring Singapore Citizens
continually upgrade themselves even when working, this scheme aims to offer more
flexibility for working adults who have entered the workforce to develop new skills and
learn more deeply about their industry as they progress along in their careers. The
government has introduced SkillsFuture Credit, which will be given to citizens aged 25
and above from 2016, to offset course fees incurred.

Encouraging the Unconventional Route

In view of the polices put in place by the government, our group feels that proposals can be
made to augment efforts in promoting vocational education in students and adults alike. In
addition to efforts to encourage citizens to take up routes that do not follow the standard
university model of education, the government can also encourage unconventional routes of
jobs through subsidizing courses that are projected to have surges in demand more heavily.

Enhancing SkillsFuture
Besides equipping the current and future workforce with necessary skills for them to thrive in
the job industry, our group feels that there needs to be opportunities for entrepreneurships as
a suitable enhancement to this policy. In addition to allowing citizens take ownership of their
own education, focusing on startups would help foster the entrepreneurial spirit in the local
community. Our group feels that by extending the SkillsFuture courses to include important
skills related to startups such as cost management and marketing can help to encourage
students and working adults to start up their own businesses by making such information
more accessible to them. This reduces the barrier of entrepreneurship, and coupled with the

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 vocational training and programmes in place, makes entrepreneurship more attractive to the
younger as well as the older population.

Nurturing the Startup Scene
As an add-on to the proposal mentioned earlier, our group feels that more can be done in
the local scene to help stimulate the growth in small businesses, as well as startups.
Currently, most grants offered to entrepreneurs are available only when the startups are
functional, and when they have developed the capabilities of a full-fledged business. We
find that this limits the growth of entrepreneurs, as most of the time, these startups fail
due to insufficient funds at the very initial stage. As our group has found that starting
ones own business can be a highly plausible and possibly attractive alternative route to
higher education19, and we want to see how we can bolster efforts to encourage these
business ventures to take flight. One of the problems we identified was that there were
insufficient funds or grants available for enterprising individuals at inception. To tackle
this, we suggest the government inject funds into an incubation programme for
Singaporean citizens, where they can access this fund as long as they have a viable
business idea, approved by relevant authorities.
3.7 Available reliefs to offset cost of raising children in Singapore
In acknowledgement of the fact that it is a costly affair to raise a child in Singapore, there are
several personal reliefs relating to children and procreation that are made available to
individuals. The reliefs are:

Figure 3. Personal reliefs relating to children and procreation

As seen from Figure 3, the number of reliefs available to working mothers double of that
available to working fathers. The only personal reliefs relating to children and procreation
available to working fathers are the Qualifying/Handicapped Child Relief and Grandparent
Caregiver Relief. Working mothers on the other hand, have two additional personal reliefs
available to them Working Mothers Child Relief and Foreign Maid Levy. The two
aforementioned reliefs were implemented with the main objective of encouraging women to re-
enter the workforce after having a child. This is especially important, as Singapores main
resource is its human capital.

19
Statistics of dropouts to entrepreneurs

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3.8 Conservative approach taken by government on reliefs
However, it is apparent that the government took a very conservative approach with regards to
these reliefs. In this day and age, it is not surprising to note that there is gender role reversal
happening in some families where fathers choose to become househusbands while their wives
rejoin the workforce. Although such an arrangement is less common among Singaporean
families, there have been a growing number of fathers who choose to be stay-at-home dads.
There were approximately 3,000 househusbands in Singapore in 2006, and the number has
increased by more than 3 times to 10,200 in less than 10 years.20 This demonstrates that family
dynamics has changed over time whereby the role of caring for children is no longer a duty
solely carried out by mothers.
Moreover, the quantum of the reliefs afforded to working fathers is a meager sum compared to
those available to working mothers. This is largely due to the fact that the quantum for
Qualifying Child Relief and Grandparent Caregiver Relief is a fixed sum of $4,000 and $3,000
respectively. Hence, the maximum amount of reliefs a father can claim would be $7,000.
Working mothers on the other hand, typically have a larger quantum of relief to claim as the
Working Mothers Child Relief is a percentage of their earned income instead of a fixed sum.
Thus, this could possibly be one of the reasons for the growing number of stay-at-home dads in
recent years.
The reliefs relating to children and procreation has the unintended consequence of creating a
gender divide between mothers and fathers. The bringing up of a child is supposed to be a
collective effort between both parents where their income forms the funds used to provide for
their child.

4.0 Pointers to address the current situation

By understanding and analyzing the current situation, several pointers had surfaced requiring
addressing to alleviate the current problems:

1. Cost of raising children While it is not the sole consideration that potential parents
take into consideration when making a decision whether to having a children, the rising
cost may require them to pursue higher income jobs either through promotions/change of
job or saving up, thereby delaying the time to start a family.

2. Late marriages due to higher aspiration of Singaporeans females - the success of the
governments plan to cultivate human capital through education has an unintended effect
of providing the female population with more job opportunities. With an aspiration to
capitalize on their higher educational level to obtain more lucrative careers relative to
their parent generation, the child-bearing female population increasingly feels that
starting a family could put a glass celling to this aspiration as employers may not want to
promote them or give them opportunities to prove themselves such as oversea assignment
should they have a family.

3. Gender reversal - gender role reversal happening in some families where fathers choose
to become househusbands while their wives rejoin the workforce or further their studies.
20
http://www.straitstimes.com/singapore/mums-at-work-dads-minding-the-kids
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 The current quantum the quantum of the reliefs afforded to working fathers is a meager
sum compared to those available to working mothers. As the bringing up of a child is a
collective effort between both parents, the meager quantum sum could reduce the
collective funds available to the family as the father is taxed more.

4. Limited career path - There is an increasing recognition that there is only one
standardize path to being ahead in life and that is education. But not everyone is adapted
and is motivated to take on this path. As there are different types of skills and talents (not
necessarily academically). This often means that for those who could not thrive or incline
to go through the standardize path, the full human potential cannot be tapped on.

5.0 Proposal set

5.1 Regarding income wage gap
CPF Contribution Exemption for Students Working Part Time

To help students coming from low income households, we seek to formulate plans which will
allow them to work and study at the same time without interrupting their studies. However,
considering that education at the secondary level is on a full-time basis, working and studying
simultaneously meant that.. During their secondary education, we

We looked to improve the CPF scheme that is already in place by proposing that income earned
under certain circumstances be CPF exempted. In order to encourage students to stay in school
even when

Through tackling the education aspect, children coming from low income households can take
the opportunity to equip themselves with skills and put themselves in a good position for the
market. This might give the child an opportunity to break out of the poverty cycle. (include
recent news by tharman?)

5.2 Regarding TFR

5.3 Comments on proposal set

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6.0 Alternative proposal set
6.1 Regarding income wage gap

6.2 Regarding TFR

Expand current relief system to allow more incentives to fathers. Current incentives favors
mothers with big ticket like WMCR which offers reliefs according to income earned while
fathers share of relief is only limitied to QCR and GCR. However, mentioned earlier, it is a
costly affair to raise a child in Singapore and as bringing up a child is a collective efforts
between both parents, expanding relief available to the father could increase the collective funds
in the householder to provide for their child.

With the increase in this funds, it is hope that it will allow families to reduce the perceived cost
portion of their internal cost-benefit analysis and this will help to encourage more children per
household. However, as the family relief are introduced to encourage married female
participation in the workforce, restriction to the uptake of relief by the father can be applied so
that the system will not be abused.

Recommended conditions: i) incentives is claimable from the 2nd child onwards and ii) must
either be staying with the family for the past basis period or contribute to the family at least 15%
of his gross income in any form of sustenance fee to the family.

6.3 Comments on proposal set

7.0 Limitation of the proposals

Despite best policies intention, there are several limitations to the proposals:

Possible side effects Similar to the unintended effect of pushing for and providing the citizen
with the ability to obtain higher education, the above mentioned policies may have an unintended
effects. However, as side effects are hard to understand and even projected during the
recommending stage, it will just serve to be a potential item to consider when evaluating the
recommendation.

Short-term results may not be apparent Low fertility rate and bridging the low income gap
are structured issues faced by Singapore. The issues are a result of long years of development

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and are not overnight issues. Similarly, it may take years and decades to see results. Therefore,
the policies results are not be measured using short-term metrics.

Hard to change peoples mindset As the figures of the takeup of child relief has shown, the
government only could do so much to change peoples mindset. Therefore, the recommendations
can do its best to influence but there is a limitation to how much the government could change
people mindset to meet the governments target. Things like having an alternative path could
take some time and success stories to start having a change in the grades obsessed society.

Social mobility could still require more than just O levels - In coming up with our
proposals, our group realized that focusing our efforts on ensuring that all children have
education up till O Level and equivalent is not sufficient. In our opinion, to allow children
from the lower income brackets to achieve social mobility, higher education is essential.

In accordance to this, we have come up with two policy considerations that we feel would be
critical to achieving social mobility and reduce the rising income gap in Singapore, namely
tertiary education and vocational training.

To alleviate the burden of these costs on parents, there are several options available for
parents to find ways to fund their children through university. Financial assistance
schemes and scholarships are available at each school, and student loans are accessible to
students who intend to complete their university education. In addition, the MOE Tuition
Grant, applicable across all universities, reduces the cost of university education
significantly for parents as well.

Policies to help parents fund their childrens university education

8.0 Conclusion (need this?)

Why the proposal should be adopted, cost-benefit analysis
Suggest an alternative proposal for the Minister to consider
Men has been traditionally seen as the breadwinner of the house and that womens only
job is to marry a good husband
WW2 in the 1960s resulted in a surge of feminism movement that demands equal rights
as men who are sent to war relies on the woman to work and take on the traditional job of
guys
Gradually the notion of equality between men and woman take form

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9.0 Appendix
Reliefs and Allowances for Taxable Individuals
As at 31 March 2016 for the Year of Assessment 2015

Number of Claimants S$'000 S$'000

Assessable Income 149,012,957

Reliefs:
Earned Income 1,629,672 2,768,814 11.7%
Spouse 202,118 406,826 1.7%
Child 444,477 5,285,859 22.3%
Parent 181,471 1,689,516 7.1%
Foreign Maid Levy 67,719 281,559 1.2%
Grandparent Caregiver 16,638 49,912 0.2%
Handicapped Brother/ Sister 3,556 19,523 0.1%
CPF 1,079,698 11,051,118 46.7%
CPF Cash Top-up 24,082 175,005 0.7%
Life Assurance 79,637 162,753 0.7%
NSman 588,374 897,738 3.8%
Course Fees 41,966 116,342 0.5%
Supplementary Retirement Scheme 61,950 749,733 3.2% 23,654,698
100%
Chargeable Income 125,358,259

With the understanding the government faces a myriad of choices with limited resources, cost-
benefit analysis will be used to i) screen potential recommendation and ii)preference the
recommendation to achieve the most value-for-money proposition

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