You are on page 1of 21

The Singapore Success Story

UNDP 2010

1|Global Event Working Paper


Acknowledgments

‘Capacity is Development' is a call to systematically review, capture and discuss key capacity
development lessons of the past and to look on to the future. Through distilling key policy and
investment choices made over time to motivate forward planning on capacity development,
this research paper helped define the content framework of the ‘Capacity is Development'
Global Event. This paper was written by Naresh C. Saxena and Dipa Singh Bagai.

© 2010

United Nations Development Programme

304 East 45th Street

New York, NY 10017 USA

DISCLAIMER: The findings, interpretations and conclusions are strictly those of the authors and
do not necessarily represent the views of UNDP or United Nations Member States.

2|Global Event Working Paper


The Singapore Success Story
The Effective Development State
According to the World Economic Forum’s ‘Global Competitiveness Report 2009‐10’
Singapore’s public institutions are ranked as the best in the world (out of 133 countries
studied); Singapore also has world‐class infrastructure (ranked 4th) , leading the world in the
quality of its roads, ports and air transport facilities. In addition, the country's competitiveness
is propped up by a strong focus on education, providing highly skilled individuals for the
workforce. Its quality of education, particularly of its science and mathematics education, is
considered the best in the world. The economic success of Singapore, and that of its public
service, is strongly driven by a government heavily involved in a number of key sectors, such as
housing, education and industry through its bureaucracy, adjudged one of the least corrupt in
the world.
What makes the Singapore government so effective, and how? What are the policy choices
that Singapore has made, the institutional arrangements it has put in place, and the investment
decisions that have allowed Singapore to be an island of excellence in the area of management
and delivery of public services? How has it created an enabling environment that empowers
public service institutions to cope with and manage change? How has the capacity of the civil
service been developed and enhanced to remain at the cutting edge? We seek to highlight
here the lessons and best practices on governance and service delivery from Singapore's public
service experience, and analyse the links between the quality of civil service and national
development, a subject that has remained relatively underexplored analytically.
Focus on Development
From its independence in 1965 the government was convinced that its survival depended upon
providing the highest quality basic services, education, health, housing and livelihoods to the
people. A sensitive post Independence geopolitical situation that included ethnic tensions,
widespread unemployment, electricity, poverty and housing shortage, the government, in
power since 1959, believed that its legitimacy for governance was to be proved by making
Singapore and economically prosperous and politically stable entity. A combination of forces
led to the emergence of this governing philosophy that focus on growth and development.
Singapore's geographical size, strategic location and lack of natural resources were major
sources of concern. The loss of the hinterland, due to its expulsion from Malaysia in 1965,

3|Global Event Working Paper


increased the urgency of the political leadership to focus on developmentalist strategy.
Singapore also did not have a large internal market to promote indifferent quality indigenous
industrial production for domestic consumption. Singapore therefore aggressively wooed
multinationals, as it needed a manufacturing industry that was efficient, innovative, and
sensitive to world markets. Moreover, it lacked a powerful class of landlords, an entrenched
aristocratic class, or a strong military elite. This gave the rulers the extraordinary opportunity
to focus on its development plans, without any serious opposition. Cultural values of
immigrants, including diligence and indifference to combative politics, provided the impetus for
growth from below.
In 1967, the British naval and Armed Forces decided to completely withdraw from the island.
At the time, British expenditure on their military bases accounted for 18% of Singapore's GDP's
and 20% of employment. Creating jobs thus became an even greater priority. The ruling party,
the People’s Action Party (PAP), having won all 58 Parliamentary seats, was able to pass strict
labour legislation and help overcome the nation's reputation for frequent labour disputes and
strikes would stop former British naval base worker as were retrained, in what became the
Sembawang Shipyard, and eventually a major shipbuilding and ship repair centre. By the 1970s,
Singapore had become a world leader in shipping, air transport and oil refining.
The government of Singapore envisioned an industrial island that would be the choice location
for the mass production of low‐cost goods. Multinational corporations (MNCs), which were
thought to be predatory and exploitative by other emerging economies of that time were gladly
welcomed by the Singapore government. It was a high‐risk gambit, but paid off handsomely for
Singapore. As a result, by the 60s and 70s, Singapore had successfully pitched itself as a
favoured choice in investment location for MNCs. And the role of the state and the bureaucracy
had been central in engendering this.
Leadership
The unity of purpose and vision of the top leaders in the government contributed immensely to
Singapore's political stability and economic progress. The leaders were successful men in their
careers before between politics. In fact, even today, the party continues to be dominated by
technocrats and intellectuals. They took a consciously pragmatic rather than an ideological
course in political and economic strategy to bring about speedy economic and social
development. In the unique context of Singapore, when the domestic private sector was weak,
the state and its bureaucracy became the leading actor to enhance economic growth, generate
employment, foster industrialisation, finance private investment, build infrastructure, deliver
various services, and thus create legitimacy for its hard policies.
4|Global Event Working Paper
Relations with the Civil Service
The government has kept excellent relations with the civil service, consciously cultivated by the
leadership in the formative years. The public bureaucracy in Singapore is organised along
Westminster lines as a career civil service subordinate and loyal to the government of the day,
with emphasis on discipline, efficiency, rationality, and capacity. From the very beginning the
leadership in Singapore has conceived of the civil service as a positive force, and believes that
economic growth would be ineffective, without the local ability to implement ambitious
national plans. The reform measures undertaken by the government to improve civil service
performance focus on two aspects of the administration; addressing the institutional aspects by
improving the structure and procedures of the public bureaucracy, and changing the attitudes
and behaviour of the bureaucrats involved in order to promote organisational effectiveness and
commitment to national development goals.
Addressing the institutional aspects has been done through several innovations ‐ filling the
senior positions based on ability rather than seniority in keeping with the government's
meritocratic philosophy, devolution of personnel management, autonomy to government
agencies by setting up functional Boards and Agencies, broadening and enhancing the quality of
the administrative service, curbing corruption, competitive pay for high‐flyers, selective
recruitment of the best and brightest, utilisation of information technology, and
institutionalising change in order to improve productivity. The objective of changing attitudes
and behaviours was partially achieved through the setting up of a Political Study Centre which
conducted courses for senior civil servants to change their attitudes and to increase their
awareness of the local contextual constraints to development. Other measures included '
voluntary ' participation of civil servants in mass civic projects, tough disciplinary measures to
deal with civil servants found guilty of misbehaviour, and selective retention of competent
expatriates civil servants and premature retirement of incompetent ones.
Politicisation of the Bureaucracy and the Bureaucratisation of Politics
The experiments of changing attitude and behaviour were largely a success, perhaps because of
the common background of the senior party leaders and the higher civil servants and their lack
of fundamental cleavages. Change in the civil servants' attitude was also facilitated by the fact
that the same party has always been in government.
More than half the sitting MPs are elected unopposed and are therefore nominated by the
ruling political elites and not elected on popular vote. This strengthens the control of the
political executive over the legislature. In time this has led to not only bureaucrats being

5|Global Event Working Paper


politicised, but politics itself having been bureaucratised. A very large number of MPs have had
successful professional careers before being inducted into politics, making politics more
technocratic than controlled by grassroots politics. The best civil servants have been
encouraged to go into politics. S. Rajaratnam, the powerful political figure of the 1960s and
70s, explained thus the close relations between the political and executive branches of the
government: 'we involved them in something far more challenging and satisfying than just
being civil servants ‐‐ building houses, roads keeping the city clean. They were being stretched.
It did not take long before we established a close link between us and the civil service. In fact,
after the first two elections, the PAP really became an administration. It was no longer a party.
And the civil service became a part of that.'
As the distinction between the PAP and the government blurred, civil servants became
increasingly loyal to both. In fact, the civil service became an important recruitment ground for
future PAP politicians. In this context, the value of neutrality for the civil service in a two‐party
system was unlikely to be preserved in a de facto one‐party state such as Singapore.
The trend of intellectual politicians in Singapore has continued to date since 1959 with the
system favouring dedicated and highly trained men, especially as ministers, to boost economic
development and contribute to the establishment of a modern technological state. Top
bureaucrats also hold multiple, interlocking directorships in the government‐linked companies
that were established to jump‐start indigenous industrialization as a second engine of growth.
Many ministers have had a career in the military, and there are close connections between the
military and the government. There is also an important link between government, the party
and the National Trades Union Congress which allows the government to exert control over the
labour unions, and on relationships between employees and employers.
While there is no doubt that the prime movers of the Singapore miracle have been its visionary
and transformational leaders, the major institutional vehicle to deliver development has been
the powerful civil service that has prepared national development plans, coordinated their
implementation, and delivered public services with such efficiency.
The Structure and Organisation of the Civil Service
The Singapore government is the country’s single largest employer, employing about 4% of
Singapore's workforce, which facilitates its playing an active role in managing and developing
the economy. The civil service has four hierarchical divisions and some highly ranked
'superscale and staff grade' officials. Division I comprises officers in the professional services,
such as engineers and teachers, and the Administrative Service, the most powerful organ of

6|Global Event Working Paper


the bureaucracy. Its officers, ministerial permanent secretaries and deputy secretaries, focus
on national policy‐making. The mid‐level Divisions II and III contain educated and specialised
workers who perform routine government work. Division IV consists of manual and semiskilled
workers. The number graduate officers had risen from five per cent in 1970 to 50% by 2006,
and some 54% of the appointees were women.
A Public Service Division, within the Prime Minister's office, manages the civil service personnel.
It aims to build a first‐class public service for a successful and vibrant Singapore through public
service leadership, capacity development, and the promotion of whole‐of‐government
coordination in strategy and implementation. Officers belonging to the Administrative Service
are appointed to the Service itself, as in India, rather than being appointed or attached to a
particular Ministry, as is the case in some countries such as Japan. In the course of their career,
they move from one Ministry to another on a frequent basis. In many cases they may be
seconded on a short or long term basis to a statutory board. Rotation is more frequent in the
early years of an officer's career, but long tenure of 5 to 10 years are quite common at senior
positions.
Recruitment
Public service employment carries high prestige, and there is considerable competition for
positions within the civil service or the statutory boards. Civil servants are appointed without
regard to race or religion, and selected primarily on their performance in competitive written
examinations. Selection is based on merit. A Public Service Commission (PSC), consisting of a
chairman and five to nine members, is appointed by the President, with the advice of the Prime
Minister. All members enjoy high credibility and reputation, and many are drawn from industry
where they have made a name for themselves in human resource management. The PSC
appoints, confirms, promotes, transfers, dismisses, pensions and imposes disciplinary control
over Administrative Officers. It has delegated the power to appoint all other officers in Division
I and the Divisions II to IV to Personnel Boards located in the Ministries.
Promotions
Promotions are based on an appraisal system, which consists of two components, the Reporting
System and the Performance Ranking System.
The Reporting System is an annual written report including an assignment worksheet which sets
the work assignment and milestones for the year, an open work review report to record the
views of the Reporting Officer and his subordinate on the subordinate’s achievements and
progress during the period under review, and a confidential development report to assess the
7|Global Event Working Paper
officer’s overall performance, character traits, and to recommend training and development
possibilities.
The Performance Ranking System is an overlays system of individual annual reports. It serves to
resolve differences in standards between various supervisors and includes factors such as
quality of work, output organisational ability, knowledge and application, reaction under stress,
teamwork and sense of responsibility. The ranking panel ranks the officers based on their
assessment of the officers’ relative standing vis‐à‐vis each other.
Principles governing civil service wages
After the self‐rule in 1959, allowances of civil servants were drastically cut in order to contain
the budget deficit, amounting to as much as 35 per cent of their base salaries for the highest
levels. As the budgetary situation improved, the government restored the allowances in 1961.
Salaries improved only in 1972 with the payment of a 13th month salary in December (Quah
2008). Though there were annual revisions from time to time after 1973, substantial increases
were given in 1982, 1989, and 1994, making Singapore civil servants the most highly paid in the
world.
Public sector compensation rests on five core principles (Neo and Chen 2007):
(i) Paying competitive rates commensurate with market rates ‐ Annual salary reviews are carried
out with comparisons based on equivalent job markets or equivalent qualifications. (ii) Paying
flexible wage packages‐ The flexible component of up to 40 per cent of annual compensation
enables the public sector to reward staff according to performance of the general economy and
of the individual. (iii) Performance‐driven pay‐ The performance bonus system, extended to all
officers in 2000, makes a strong link between pay and ability, and enables the system to
differentiate between outstanding, average and under‐performing staff, reinforcing the
meritocratic ethos. (iv) Recognising potential‐ Good officers are eligible for merit increments.
High performing, high potential officers receive much higher increments, helping them to
ascend the career ladder at a much faster rate. This is in recognition of the fact that good young
officers are no longer content to wait a long time to be promoted and face the prospect of
peaking in their careers just before retirement.(v) Paying clean wages‐ Public sector salary
packages translate as many benefits as possible into cash. This reduces the number of hidden
perks and increases transparency and accountability.
The merit based, performance and potential‐driven system ensures that talented individuals
rise quickly through the ranks, to reach their peak in their mid to late 30s. This has been part of
a concerted strategy to reward and retain top talent, a key challenge since the 1970s.
8|Global Event Working Paper
Elimination of Corruption from Public Life
Today, the Singapore bureaucracy is adjudged as one of the least corrupt in the world, ranking
fourth only behind Denmark, Finland and New Zealand in 2007 (Bernardo 2008).
However, at the time of independence corruption in Singapore was rife in most departments
though even then the higher civil service was relatively free from it. The Anti‐Corruption Branch
(ACB) failed to reduce corruption because of its limited powers and inadequate manpower, but
also because of its inability to deal impartially with police corruption, being itself part of the
police outfit. The ACB’s ineffectiveness led to its replacement by the Corrupt Practices
Investigation Bureau (CPIB), which was placed under the Prime Minister’s office in 1960.
Initially, the government focused its efforts on strengthening the existing legislation and its
enforcement to reduce the opportunities for corruption and to increase the penalty for corrupt
behaviour. The improvement of salaries and working conditions in the civil service contributed
indirectly to the fight against corruption by reducing the need to indulge in corrupt behaviour.
Clearly, corruption was controlled much before the salaries were increased. The replicability of
Singapore’s success in controlling corruption therefore could be feasible even in countries that
are not able to pay very high salaries to government staff. What is needed is the honesty and
competence of its political leadership to build an institution like the CPIB and create a climate
whereby strong punitive measures could be introduced and enforced.
The anti‐corruption law has been reviewed regularly to ensure that offenders do not escape
legal punishment and that corruption does not pay. Equally important in controlling corruption
are the administrative measures by various government agencies and regulations that regulate
the official behaviour of the bureaucrats. The agencies under this category are the various
Ministries, the Public Service Commission (PSC), the Budget Division of the Ministry of Finance,
the Audit Department, and the Central Complaints Bureau. They prescribe regulations and can
take disciplinary action, besides cutting red tape and making administration more efficient.
One of the critical factors responsible for the SCS’s role in national development is the honesty
and competence of its political leadership, and the institutional structures that have been put in
place. They have transformed the colonial SCS into a national institution by minimizing
corruption and by attracting the talented to join and remain in the SCS through its meritocratic
system and its policy of paying competitive salaries.
Capacity Development in the Last Two Decades

9|Global Event Working Paper


Creation of autonomous agencies
From the 1990s Singapore embarked upon a corporatisation strategy aimed at delivering
certain public functions on a business‐like basis through disaggregation of various ministries,
departments, and agencies into autonomous executive agencies. The aim was to separate
policymaking functions of the ministries from the delivery of services with greater autonomy
and the delegation to these autonomous agencies (AAs) of financial and managerial authority
for formulating and implementing programmes based on final results or outcomes, rather than
inputs and processes (Haque, 2003).
Examples of corporatization include the Inland Revenue Department reconstituted into the
Inland Revenue Authority of Singapore, corporatization of hospitals under the Ministry of
Health, the corporatization of the refuse collection functions of the Ministry of Environment,
etc. leaving them to deliver services and to compete with private companies/entities. Many of
the state‐owned enterprises are required to operate on a for‐profit basis under the laws that
govern private operations.
Reforms in the Singapore's Administrative Service
The economic and social transformation of Singapore in the last 30 years has influenced major
adjustments within the Administrative Service. Fast economic growth, rising expectations of the
people, and the new expectations from the civil service to play an entrepreneurial role have
thrown many challenges before the Administrative Service.
These have been taken seriously by the Singapore government, and several reforms have been
introduced including permitting well‐qualified civil servants outside the Administrative Service
to enter the Service during mid‐career; faster promotions; fixed term appointments (ten years
each) for Deputy and Permanent Secretaries; rigorous assessment and appraisal procedures;
and posting Administrative officers to private business and non‐ profit organisations for
attitudinal change.
WITs and PS 21
In addition there have been other major reforms, affecting the entire public service, such as
Work Improvement Teams (WITs) and the Public Service for 21st Century (PS21) initiative
launched in May 1995, which lies at the core of institutionalizing and integrating change
throughout the civil service. A WIT is a group of civil servants from the same work unit,
irrespective of job status, which meets regularly to identify, discuss and analyse problems,
work out solutions to problems and then implement these solutions. Productivity
enhancement in the civil service is built around WITs. PS21 is a movement on how to operate
10 | G l o b a l E v e n t W o r k i n g P a p e r
the public service as leaner, more responsive and more service‐oriented outfits. PS21 has two
basic objectives (Tay 1999): to nurture an attitude of service excellence in meeting the needs of
the public with high standards of quality, courtesy and responsiveness; and to foster an
environment which induces and welcomes continuous change for greater efficiency and
effectiveness by employing modern management tools and techniques.
In order to quickly address citizens’ grievances a ‘No Wrong Door’ policy is pursued. Launched
in 2004, the premise of the No Wrong Door policy is a simple one: if an agency receives
feedback on an issue which is not under its charge, it must redirect the feedback to the right
agency and ensure that the latter agency responds to the feedback giver; and if the feedback
involves more than one agency, the receiving agency should coordinate a single consolidated
reply.
Outstanding public officers who exhibit exemplary behaviour and commitment and make an
impact on the people are constantly rewarded in hugely attended and publicised functions. In
addition, citizens who make valuable suggestions to improve services are also rewarded.
Changes in budgetary procedures
Singapore’s budgeting framework has evolved from a traditional bottom‐up system based on
detailed line items to a top‐down system structured around budget ceilings on spending.
Annually, each Ministry receives a 5‐year spending ceiling (known as a ‘block budget’) based on
a pre‐agreed percentage of the GDP. Within this ceiling, MOF empowers Ministries to make
spending decisions based on their respective strategic outcomes and priorities. Key
performance indicators are developed and monitored by Ministries to support many whole‐of‐
government outcomes developed jointly by MOF and line Ministries. Performance information
is used mainly by the relevant Ministries in assessing strategy, and MOF uses the information
when evaluating bids for additional funds (Chabra 2008).
Block budgeting has transformed the nature of dialogue between the MOF and the ministries‐
from endless negotiations for budget allocations to longer‐range discussions about strategic
priorities and outcomes. Performance discussions with Ministries focus on longer term trends
rather than specific year over year changes, and emphasize the improvement in the quality of
measures (such as moving from output to outcome measures) and the consideration of stretch
targets where appropriate.
Perhaps the most significant development in Public Expenditure Management in recent years is
the development of ‘performance budgeting’, which aims to link resource allocation to results
through an integrated system approach of planning, management and monitoring of
11 | G l o b a l E v e n t W o r k i n g P a p e r
government’s activities. Together with the introduction of a Medium Term Expenditure
Framework (MTEF), which usually lasts for three years, these reform tools enable government
in Singapore to ensure developmental results through budgets (Chen and Tan 2008).
Role of training in leadership development
In view of the importance of training and development for the future of Singapore and for
shaping the public service, an overall training target of 100 hours per employee per year is set.
The Civil Service College (CSC) was set up as a Statutory Board on 1 October 2001 with the
responsibility of capacity development for public servants. The CSC is placed under the ambit of
the Prime Minister's Office, which signals the political commitment towards administrative
reform and capacity development. The CSC uses techniques like scenario‐based planning to
train senior officials to think outside the box. The CSC also provides opportunities for
networking between the higher bureaucracy and the elites of the policy communities in the
private sector in a ‘think tank’ environment.
Ministries and departments are responsible for the training of their staff and are provided with
funds to do that. Training and development programmes are either run by the ministries and
departments themselves or they avail themselves of the services provided by the Civil Service
College. They are also free to go to other institutions to meet their needs. This encourages
competition and keeps public sector training institutions on their toes.
Impact of reforms
These key reforms, by placing greater emphasis on change management and service excellence
coupled with the relevant financial management reform, resulted in almost the entire civil
service being managed as Autonomous Agencies (AAs). Each AA was provided with greater
financial and personnel management autonomy and flexibility to respond to changes. AAs were
rewarded for efficient and superior performance and recognized for enterprise and creativity.
Whilst AAs were given greater autonomy and flexibility, they were also subject to a higher level
of accountability. Organisations became more aware of outcomes and the cost of producing
the outcomes.
Following this, the central personnel agencies (CPAs), such as the PSD, PSC, and MOF are now
responsible only for developing a general HR framework or controlling senior public servants, or
handling forwarded appeals. The emphasis in implementation of HR activities has shifted away
to the ministries or boards to suit their own unique organisational settings. In return for such
delegation, departments are subject to greater accountability and are expected to attain higher
standards of performance (Cheema, 2005).
12 | G l o b a l E v e n t W o r k i n g P a p e r
Use of Information Technology in Modernising Administration
Singapore was one of the earliest governments in the world to implement the e‐government
system. The IT2000 Master Plan provided a blueprint for the use of IT in nearly every
government department. The Ge‐BIZ portal on the e‐government site was the world’s first
Internet‐based government procurement system. At the eCitizen centre, Singaporeans obtain
information and bid for certificates to register a vehicle, file their taxes, download forms to file
for bankruptcy, register a marriage, baby, car or a pet, apply for a passport, housing or utilities,
check their provident fund accounts or their child’s school registration status, etc.
An example is the Work Permit Online (WPOL) service. The WPOL is today a leading‐edge e‐
service for Singapore businesses with a processing capacity, integrative features and efficiency
standards that are unsurpassed in the world. In order to achieve dramatic improvements in
transaction time, over 50 rules, procedures and requirements were reviewed in the
development process, and back‐end integration between agencies was exploited where
possible. The resulting system improvements have led to faster processing times despite record
transaction volumes and with no increase in staffing levels. Employers using WPOL enjoy
processing standards that are the best in the world. 90% of service requests are processed
either immediately or by the next working day. For its achievements, the WPOL service was
awarded the 2006 UN Public Service Award for improving transparency, accountability, and
responsiveness in the Public Service, one of only three government organisations worldwide,
and the only one in the Asia‐Pacific region to receive the award.
Inter‐Ministry coordination
The infocomm revolution of the past two decades provided the technical means to deliver a
wide range of services quickly, efficiently and conveniently, and unlocked the potential of deep
but often unwieldy government databases, resources and processes. However, there was a
sense in Singapore that the low‐hanging fruits of public service reform and efficiency gains have
been mostly identified, if not harvested. It was clear that the real gains would accrue when
whole‐of government approach was followed.
Singapore has therefore made efforts to achieve true service integration, through the redesign
of business processes and flow‐through for related public services across different agencies. E‐
governance has played a significant role in breaking of barriers between the Ministries leading
to strong whole‐of‐government reaction to citizens’ needs.
The ideological framework under which bureaucracy functions in Singapore has provided a
number of advantages for the development of e‐government. Inter‐departmental and agency

13 | G l o b a l E v e n t W o r k i n g P a p e r
barriers are extremely porous, allowing seamless collaboration across agencies rather than the
replication of governmental structures behind the scenes. Second, efficiency is at the core of
the process. Structures are capable of being easily remodelled without fear of creating
territorial issues within agencies. Finally, the osmostic nature of the system of government and
the pragmatic approach that drives it makes it highly malleable. It can be adapted and adopted
to changing circumstances very quickly.
Government Intervention in the Market
How does the Singapore government intervene in the market? First, The Singapore government
invests large amounts in order to increase the country's attractiveness to investors, such as, in
infrastructure and skill building for manpower. Singapore enjoys one of the highest rates of
domestic savings in the world, and has built up over the years huge budgetary surpluses to fund
such activities. These services are provided by statutory boards, set up as autonomous
organisations to provide all infrastructural, promotional, and public utility services.
Second, government promotes industrialization and investment through Government‐linked
companies (GLCs) which complement the statutory boards and are in turn owned substantially
by government or government owned companies, such as Tamasek Holdings.
The third key area where the Singapore government has influenced markets is wage restraint
and import of cheap labour. This strong guard was witnessed during the 1985 recession when
the government cut the employer's CPF (Central Provident Fund) contributions from 25 percent
to 10 percent of an employee's wage.
Fourth, the government has a partial Divestment programme of selling shares of government
companies such as Singapore Telecom and Singapore Airlines in the open market. This makes
its role stronger and more extensive as it provides the government with retaining control and
revenues to invest elsewhere.
And last, Singapore has deregulated several markets, e.g. the electricity and
telecommunication, and more recently civil aviation. The government no more monopolizes
these markets, and it is open for competition among the industry players. Ever since 1989, the
government of Singapore started eliminating restrictions on the sale of telecom consumer
goods to make businesses more competitive, which benefit the end consumer and the business
as well.
The state plays a major role in managing the economy with the market being 'free' only to the
extent that the government allows it to be free. The state determines what is produced, what is
available for export, and what is subsidized, and what is not. But the role of the government is
14 | G l o b a l E v e n t W o r k i n g P a p e r
'primarily market facilitating rather than market inhibiting.’ Singapore is ranked number one
out of 183 economies, as regards ease of doing business, whereas Hong Kong is ranked 4th,
Japan 15th, and China 89th.
Statutory Boards
The Singapore government’s participation in the economy takes two forms – either through the
statutory boards or through the Government‐linked companies (GLCs). Boards are more directly
under the government whereas GLCs are more loosely related to the government, whose
involvement is through equity participation. The Singapore government set up statutory boards
for three reasons. First, statutory boards were formed to perform efficiently the tasks of
development without facing the constraints encountered by the SCS of rigid regulations and
inflexibility. Second, the aim was to reduce the SCS’s workload by entrusting the new
organisations with the implementation of socio‐economic development programmes. Finally,
statutory boards were formed to minimize the movement of talented civil servants to the
private sector.
In order to achieve these developmental objectives, the government established a series of
development‐related institutions or enterprises that are owned, managed, or supervised by the
state. Examples of such state enterprises include the creation in the 60s and 70s of the Housing
and Development Board (HDB), the Economic Development Board, the Public Utilities Board,
the Port of Singapore Authority, the Jurong Town Corporation and Development Bank of
Singapore, and the Telecommunication Authority of Singapore (Low and Haggard, 2000).
An example of the responsiveness to external demand is the creation of the Singapore
Cooperation Enterprise (SCE) in 2006 by the Ministry of Trade and Industry and the Ministry of
Foreign Affairs of Singapore to have an agency to respond effectively to the many foreign
requests to tap into Singapore’s development experience, and to share Singapore’s public
sector expertise with interested foreign parties, government or non‐government. Examples are
the MoU between the SCE and the State Administration of Foreign Experts Affairs of the
Republic of China to cooperate in the transfer of knowledge and expertise for Chinese
government officials, and the MoU between the SCE and the Ministry of Public Housing,
Government of Indonesia to cooperate on the development of public housing policy, low cost
housing delivery and housing finance in Indonesia.
The Housing and Development Board (HDB) – a successful example
The HDB has not only been credited with the eradication of the dismal living conditions of pre‐
Independence times but also with achieving the highest homeownership in the world (WDR,

15 | G l o b a l E v e n t W o r k i n g P a p e r
2009). A record 92 percent of the total population (which includes those in private estates) own
their own abode. This has been in part accomplished through a government sponsored home
ownership scheme, which enables prospective buyers to get the rented apartment at an
affordable and subsidised price. 93 per cent of those living on rent in public housing have
ultimately purchased an apartment.
The public housing programme has been used by the government to do social engineering. The
government drew on resettlement to break up the ethnic enclaves and communities that had
characterized colonial Singapore. It put its policy of multiracialism into practice by seeing that
all apartment buildings contained members of all ethnic groups in numbers that reflected their
proportion of the national population.
In many countries and for many people the concept of public housing is mostly used as a
housing programme of low quality and insecure place to stay in. But in Singapore, the Housing
Development Board (HDB) flats offer their residents “quality lifestyles in quality buildings”. In
the 1960s and early 1970s, before the growth of export‐oriented industry, housing construction
provided much employment and an opportunity for workers to learn new skills.
HDB has won a large number of prestigious awards for achieving great strides in public housing.
Besides being the sole recipient of the Singapore Quality Award with Special Commendation
and the United Nations Public Service Award in 2008 for its Home Ownership Programme, HDB
has risen to the ranks of the top ten best employers and enterprise friendly organisations in
Singapore. It is also recognised for its engineering prowess, winning a national achievement
award and an outstanding ASEAN award.
The government’s highly interventionist approach and active involvement in the economy is
one of the reasons for Singapore’s initial economic success. Boards and the GLCs, despite being
“government”, have been run on commercial criteria, while it is true that monopoly and quasi‐
monopoly powers have helped profitability. The overall balance of evidence suggests that
Singapore’s boards and GLCs are among the most efficient and well managed state‐owned
enterprises in the world, which is in part due to their private‐sector type orientation (Hwee et
al. 2005). The wide scope of these institutions indicates the state’s active involvement in
economic development for more than four decades. This state‐managed developmentalism has
also worked in favour of legitimizing the ruling party’s political power.

16 | G l o b a l E v e n t W o r k i n g P a p e r
Lessons for Other Countries
Summing up the factors behind Singapore’s success
The Singapore government has managed to improve and sustain the quality of its civil service
because of the successful implementation of the following five policies: (1) the adoption of anti‐
corruption measures; (2) selective recruitment of the 'best and brightest'; (3) competitive pay;
(4) massive computerization leading to transparency and greater consumer satisfaction; and (5)
linking promotion and pay increments with both potential and actual output of the public
servant.
While these policies promote individual excellence, attention has also been given to maximize
institutional outcomes through (1) delegation of authority for operational decisions to
autonomous agencies, while retaining the power of oversight with central agencies; (2) instilling
in organizations a sense of pride and ownership of their outcomes through training and
movements like PS21; (3) linking performance measurement systems of institutions with
incentives and awards for innovative practices; and (4) leading by example which transmits
strong values and principles of good governance socially rather than formally throughout the
organisation.
It cannot be over emphasized that the city‐state’s situation is evidently very different from
many developing countries. Its small geographical size and compactness (supported by an
excellent communication infrastructure), allow for efficient planning, cohesive decision making,
channelling of information, and deployment of personnel within and between the government
and private sectors (Kong et al. 2008). Another is the virtuous circle through which resources
for bureaucratic reform (such as civil service pay increases) have both contributed to, and been
generated by, Singapore’s remarkable economic ascent (Fritzen 2006).
In addition to rules and procedures, performance of an organization is also influenced by its
culture, which is created by and springs from the beliefs, values and assumptions of the
founders of the organization. The early generations of leaders in Singapore, such as Lee Kuan
Yew, Goh Keng Swee, and Rajaratnam, strongly believed in building up an effective civil service
based on integrity, meritocracy and result orientation that would facilitate economic growth
and social development. Overtime, these values were internalized by the civil service, and since
then have stood as guiding principles for its policies and programmes.
Finally, Singapore has emerged virtually as a one‐party democracy. This permits the
government to be more involved in administration than with politics. Its main concern was and

17 | G l o b a l E v e n t W o r k i n g P a p e r
continues to be the management of Singapore. It may otherwise be difficult in a democracy to
announce, as Singapore does, that it will ‘do what is right, not what is popular’.
Are these reforms replicable?
Clearly, it is not easy to replicate Singapore's approach to efficiency and sustaining quality in its
public institutions and its civil service outside of Singapore, because of the high economic and
political costs involved. It is expensive to pay civil servants high salaries, just as it is difficult to
minimize corruption or to introduce a meritocratic system without widespread political
support. Singapore's experience shows that a strong government with a long tenure of office
(50 years) and sustained economic growth in the country have enabled the implementation of
the policies responsible for creating robust institutions, and sustaining quality in the public
service.
For instance, the Singapore government started to decentralize HR functions after putting in
place some of the critical factors for success, which has not, in turn, led to the expected
favouritism, nepotism, and corruption. The effectiveness of a decentralized HR policy depends
on how well it is administered. A common weakness in decentralizing HR is to delegate
authority to act without adequate standards for guidance or adequate audit and oversight
mechanisms to ensure compliance with general policies.
Therefore an objective analysis of the political climate and managerial competence of each
country would have to be done before replicating reforms that have proved to be such a great
success in Singapore.
In many developing countries, especially in South Asia, the quality of public management
depends to a large extent on the nature of party politics and the quality of political leadership.
There is a feeling widely shared among the political and bureaucratic elites in many
governments in Asia that public office is to be used for private ends. Election cycles etc. place
intense political pressures for distribution of patronage that leave little time or inclination for
investing in conceptual thinking in the design of good programmes, weeding out those not
functioning, and monitoring the programmes with a view to take remedial action to improve
the effectiveness of delivery, and to invest in policies that foster enabling environments. Weak
governance, manifesting itself in poor service delivery, excessive regulation, and uncoordinated
and wasteful public expenditure, impinges on development results and social well being. In the
ultimate analysis public service issues cannot be isolated from those of political economy.
For comprehensive reform and accountability of the public service to be sustained, a strong
political and administrative will from the top is necessary. In its absence, reforms remain only
18 | G l o b a l E v e n t W o r k i n g P a p e r
on paper. Accountability has to be induced; it cannot be decreed by fiat. It is a result of a
complex set of incentives, transparency in processes and decision making, and checks and
balances at various levels of government. A good civil service is necessary but not sufficient for
good governance; a bad civil service is sufficient but not necessary for bad governance.
The experience of Singapore reveals that political history, party politics, macroeconomic
considerations, adaptability of the civil service, and farsightedness of leaders are critical factors
in determining the outcomes, the type of change, and the extent of the reform initiatives.
(Samaratunge et al. 2008). Other countries concerned with improving governance would
certainly benefit from studying the success of reforms in Singapore. But it would be useful to
recall the combination of factors that have contributed to Singapore’s extraordinary success in
public service delivery, and to remember that “Bureaucratic models are not packages ready for
export or import; they provide illustrations of options and styles for consideration in their
separate parts, and for adaptation before acceptance in a different context.”

19 | G l o b a l E v e n t W o r k i n g P a p e r
Bibliography
Bernardo Robert (2008): The Role of Incentives in Civil Service Reform: the Singapore Story
Cheema, G. Shabbir, (2005): Building Democratic Institutions; Governance Reform in Developing
Countries, Kumarian Press, Bloomfield, CT.
Chen, Shian Jan and Winston Tan (2008): Achieving Performance through Budgets, paper presented at
the Malaysian Evaluation Society (MES) Third International Evaluation Conference, Kuala Lumpur: 31
March ‐ 4 April

Chhabra Samir (2008): Performance Management Case Study: the case of Singapore
Fritzen, Scott (2006): Discipline and Democratize: Patterns of Bureaucratic Accountability in Southeast
Asia, The Lee Kuan Yew School of Public Policy, National University of Singapore
Haque, M. Shamsul (2003): New Public Management in Malaysia and Singapore, Journal of Comparative
Asian Development.
Hwee, Yeo Lay, Tan Hsien Li and Joanne Lin (2005): Governing Singapore: How, Why, and Where are we
Heading? Singapore Institute of International Affairs, September
Kong, LEE Sing, GOH Chor Boon, Birger FREDRIKSEN, and TAN Jee Peng (2008): Toward a Better Future:
Education And Training For Economic Development In Singapore Since 1965 Edited, World Bank
Low, Linda and Haggard, Stephan (2000). State, Politics and Business in Singapore. Working Paper Series,
May. Singapore: Department of Business Policy, National University of Singapore.
Neo Boon Siong and Geraldine Chen (2007): Dynamic Governance: Embedding Culture, Capabilities and
Change in Singapore, World Scientific, Singapore
Quah, Jon S.T. (2008): Good Governance, Accountability and Administrative Reform in Singapore,
American Journal of Chinese Studies, Vol. 15, No. 1 (April 2008): 17‐34.

Samaratunge Ramanie, Quamrul Alam and Julian Teicher (2008): The New Public Management
reforms in Asia: a comparison of South and Southeast Asian countries International Review of
Administrative Sciences 74(1)
Tay, Janet (1999). Public Service Reforms in Singapore. New York: Management Development and
Governance Division, UNDP.
WDR (2009): World Development Report, World Bank

20 | G l o b a l E v e n t W o r k i n g P a p e r
21 | G l o b a l E v e n t W o r k i n g P a p e r