What do people living in Singapore today need in order to meet basic standards of living? Over two waves of Minimum Income Standards (MIS) research^[1], our team conducted focus group discussions with ordinary Singaporeans to investigate this question. Our 2019 study reported household budgets for older persons: 55 to 64 years old, and 65 years and above. The 2021 study, which we recently released, determines the amount of money that households with children need for a basic standard of living in Singapore. It covers households with single or partnered parents, who have one to three children of any age up to 25 years old. The total monthly household budgets required to meet a basic standard of living are: $3,218 per month for a single parent with one child aged 2 to 6; $6,426 per month for partnered parents with two children aged 7 to 12 and 13 to 18 years old; and $1,421 per month for a single elderly person.

Using a consensus-based focus group discussion approach, our research also resulted in rich qualitative data that gives us better understanding of how ordinary lives are lived, as well as people’s everyday concerns, anxieties, and aspirations. In this essay, excerpted from the 2021 report^[2], we draw attention to what the study reveals about how people think about needs, and in particular how they think about the needs of children.

Studying households’ needs across different life stages reveals a few broad themes.

First, as people move through the life course, priorities change and attentions shift. Older participants spoke more about health needs – invoking the importance of health when talking about food, leisure and even household goods such as non-slip flooring. They worried about healthcare costs and about “burdening” younger members of their families. In contrast, participants who are currently parents to dependent children brought greater attention to children’s education and their own work-life balance needs.

Second, in speaking of basic needs, participants who are parents regularly prioritised the needs of children. In discussions of household goods, parents insisted on higher quality or specialised items in order to ensure the safety of children. For items which were typically contentious and hard to form consensus on, such as air-conditioning, the orientation toward wanting children to be comfortable meant that the conversations lingered for a longer time compared to when older persons discussed these as needs for themselves (participants ultimately left out air-conditioning from budgets). When talking about social activities for children, parents spoke of developmental and social needs as well as wanting children to be able to fit in and get along with peers. In general, they put higher emphasis on children’s social participation needs than their own. Conversations were especially animated when we got to the topic of education needs. Parents were quick to presume that everyone in Singapore cares deeply about children’s education. They spoke of the need for tuition to help children keep up in school. Notably, the needs around education are seen as not simply immediate and short term, but for children’s long-term good. Education needs form a significant part of household budgets and are seen as a major priority.

Third, gender and marital status matter when it comes to people’s views and experiences of needs. In general, women more than men centred household needs on children’s needs. They were somewhat more knowledgeable about and attentive to children’s changing needs when growing up and the specific items necessary for meeting them. Both men and women made presumptions about women playing larger roles as caregivers and in housework (including cooking), and men as full-time workers. This came through in the ways they discussed kitchen items and food, childcare and education, as well as clothing. Single parents, compared to partnered parents, expressed both a more pronounced prioritisation of their children and more anxiety around meeting children’s needs. Single mothers, in particular, expressed many anxieties. They talked about the difficulty of ensuring adequate income as single earners and of maintaining employment given the challenges of securing good care alternatives. They also worried that if something happened to them, their children would have no one else to depend on. Single mothers among our participants were especially articulate in revealing their strategies for stretching limited budgets to meet their children’s needs. This included cutting things out of their expenditure even though they recognise that they are forgoing their own needs.

These broad themes observed in focus groups are an important reminder that needs are complex and diverse. Therefore, budgets for basic standards of living must reflect and be inclusive of different parts of society.

CHILDREN’S CARE AND EDUCATIONAL NEEDS
As mentioned, groups were especially animated when it came to discussing children’s care and educational needs. The arrival of a child in a family changes parents’ lifestyles and schedules significantly. Professional infant care services are needed when mothers return to work after maternity leave. Parents agreed that early childhood is a critical phase in children’s lives and there is a need for childcare centres where children can learn and play. Parents also included some budget for outings, additional lessons and graduation events.

As children enter primary schools, the budget for after-school services and educational support becomes more critical. Parents need budgets for in-school student care services for primary school children, during school days as well as during school holidays. For both primary and secondary school children, a significant budget is needed for small-group tuition (i.e. fewer than 10 students per class) and enrichment classes. Parents also included a budget for assessment books.

Notably, there was little contention among parents. We asked them to clarify why these are basic needs. They talked about these practices as norms and expressed anxieties about children not performing well in a competitive academic environment. Without tuition classes, parents said that children’s academic results would suffer. They mentioned that children themselves often ask for additional learning support.

Among our respondents, both parents and young adults emphasised the importance of educational qualifications in Singapore. They said that obtaining a university degree in a general discipline has now become a need rather than an aspiration because this is the minimum requirement for many jobs in Singapore. A university degree provides more varied job choices and stable career opportunities. Even with a degree, young adults stressed the expectation that they will need to continue pursuing professional qualifications and certifications during their working life to gain new skills and keep up with changes in work demands.

TRANSFERS AND SUBSIDIES FOR CHILDREN
Given that children’s well-being is extremely important to society as a whole, most governments and societies recognise the importance of directing public resources toward their care and education. In Singapore, to what extent do these contribute to meeting needs? In our study, we compare transfers and subsidies for children to MIS budgets, taking into account universal schemes that apply to all children as well as major means-tested programmes. Households with children receive the Baby Bonus, a one-off transfer made up of a Cash Gift of $8,000 and a First Step Grant of $3,000 deposited into a Child Development Account that can be used to pay for childcare, kindergarten and other approved fees and expenses^[3]. Since the stated policy intention of the Baby Bonus is to “defray the costs of raising a child”, we divided the monetary value of the Cash Gift over 12 years – until the child completes primary school – for the purposes of comparison against the household budgets. The same is done for the First Step Grant, since the Child Development Account closes when the child turns 12. As a lump sum payment, the Baby Bonus may be significant. But spread over 12 years, even the Cash Gift – which is more than twice the First Step Grant – is equivalent to less than 2 percent of the MIS monthly household budgets for the single and partnered parents.

When calculating the costs of childcare in the household budgets, we assumed that the mother is working. For working mothers, higher care subsidies are available, including a means-tested component^[4]. Both the income limits for means testing and amounts of support decrease for older children. The current household income limit to qualify for higher infant care and childcare subsidies is fairly generous, at $12,000 per month, or 1.9 to 3.7 times of the partnered and single parents’ budgets. Below this ceiling, household incomes also determine the amount of subsidy, with those on lower incomes receiving more. Monthly subsidies for infant care are equivalent to 4 to 36 percent of the single parent’s budget and 2 to 21 percent of the partnered parents’ budget. Subsidies for childcare are slightly lower, equivalent to 5 to 24 percent of the single parent’s budget and 2 to 12 percent of the partnered parents’ budget. Once the child reaches primary school age, the income limit tightens abruptly. To qualify for student care subsidies, monthly household incomes may not exceed $4,500^[5], equivalent to 1.2 times of the single parent’s budget but less than what the partnered parents need for a basic standard of living. Depending on their incomes, households may receive subsidies equivalent to 1 to 8 percent of the single and partnered parents’ budgets.

For children in primary and secondary school, the MOE Financial Assistance Scheme offers a fee waiver, free textbooks and school uniforms, and subsidies for transport and meals if they pass a means test^[6]. The household income limit is 43 percent of the partnered parents’ budget and the total value of assistance for two children (each attending primary and secondary school) is $385 per month, or just 6 percent of the household budget. Bursaries are available for university students from households with incomes up to $9,000 (or $2,250 per capita)^[7], which exceeds the budgets for both the single and partnered parents’ households. Households with lower incomes receive larger bursaries. The range of bursary amounts is 1 to 10 percent of the budgets, comparable to the generosity of student care subsidies, but lower than the subsidies for younger children.

In sum, the current regime of support for children’s education and care costs resembles a wedge: more generous for younger children, but tapering off sharply for older children. As these costs, before subsidy, are also generally lower as children grow up, the impact of the various schemes is to flatten the costs of education and care between birth and the age of 18. However, not all the costs associated with children in the household budgets decrease with age. Food, clothing and social participation are all more expensive for older children. These are areas which support schemes do not explicitly address. Because of this, financial pressures may become heavier for parents as their children grow older.

To meet basic needs, people draw from different sources of income and support – work, public schemes and informal social support. In households headed by working-age adults, wages are usually the primary income source. But in Singapore, there is significant inequality in work incomes across the labour market, and wage protection is still rudimentary. Public provision is therefore critical, to flatten out wage inequality and ensure that all households can meet their basic needs. In particular, how public services are funded in areas such as housing, healthcare, education and childcare can make a huge difference to household finances, as they are both costly and needed by all households with children. The greater the extent of state funding for these services, either through direct service delivery or universal subsidies, the lighter the financial burden on individual households. As they are currently organised in Singapore, these services account for significant proportions of the household budgets – 28 percent for the partnered parent household and 39 percent for the single parent household. Clearly, this is an area that demands greater attention.

In our focus groups, we saw that even as participants agreed on basic needs, they were keenly aware of the many financial demands that parents face and of people’s unequal capacities to meet these demands. They observed that for some households, economic barriers may create a gap between goals and realities. Now that we have learnt what people need, as well as their concerns, the challenge we face lies in collectively ensuring that all members of our society meet these basic needs. ⬛

This commentary draws from “What people need in Singapore: A household budgets study”, which the writers co-authored with Neo Yu Wei, Ad Maulod, Stephanie Chok, and Wong Yee Lok. The study is available at whatsenough.sg.

¹ The Minimum Income Standards research is available at: https://whatsenough.sg/key-findings-mis2019/ and https://whatsenough.sg/key-findings-mis2021
² Ng, K. H., et. al. What people need in Singapore: A household budgets study. 2021. Available at: https://whatsenoughsg.files.wordpress.com/2021/10/2021-what-people-need-in-singapore-final-report.pdf
³ Ministry of Social and Family Development (MSF). Baby Bonus Scheme. 2021, July 5. Retrieved from: https://www.msf.gov.sg/assistance/Pages/Baby-Bonus-Scheme.aspx
⁴ Early Childhood Development Agency. Subsidies and Financial Assistance. 2021. Retrieved from: https://www.ecda.gov.sg/Pages/Subsidies-and-Financial-Assistance.aspx
⁵ Ministry of Education (MOE). Financial assistance information for Post-Secondary Education Institutions (PSEIs). 2021. Retrieved from: https://www.moe.gov.sg/financial-matters/financial-assistance/financial-assistance-information-for-pseis
⁶ MOE. Financial Assistance. 2021. Retrieved from: https://www.moe.gov.sg/financial-matters/financial-assistance
⁷ MSF. Student Care Fee Assistance (SCFA). 2021, July 5. Retrieved from: https://www.msf.gov.sg/Comcare/Pages/ComCare-Student-Care-Subsidies.aspx

Teo You Yenn is Associate Professor, Provost’s Chair, and Head of Sociology at Nanyang Technological University.

Ng Kok Hoe is Senior Research Fellow and Head of the Case Study Unit at the Lee Kuan Yew School of Public Policy, National University of Singapore.