Singapore and Switzerland

Secrets to Small State Success

Yvonne Guo, J J Woo

• Publisher: WSPC
• Year: 2016
• ISBN:
  9789814651417
• Topic: Economics
• Subtopic: Comparative Economics
• Index: Economics

The cases of Singapore and Switzerland present a fascinating puzzle: how have two small states achieved similar levels of success through divergent pathways? Are both approaches equally sustainable, and what lessons do they hold for each other? While Singapore is the archetypal developmental state, whose success can be attributed to strong political leadership and long-term planning, Switzerland's success is a more organic process, due to the propitious convergence of strong industries and a resilient citizenry. Yet throughout the course of their development, both countries have had to deal with the dual challenges of culturally heterogeneous populations and challenging regional contexts. Edited by Yvonne Guo and Jun Jie Woo, with forewords from Ambassadors Thomas Kupfer and Tommy Koh, Singapore and Switzerland: Secrets to Small State Success features contributions from distinguished scholars and policymakers who explore the dynamics of two small states which have topped international rankings in a dazzling array of policy areas, from economic competitiveness to education to governance, but whose pathways to success could not be more different.

Contents:

• Foreword by Ambassador Thomas Kupfer
• Foreword by Ambassador Tommy Koh
• Preface
• Introduction and Background: The Trajectories of History, Politics and Economics
• Public Administration in Singapore and Switzerland (Yvonne Guo and Andreas Ladner)
• Neutrality, Balancing or Engagement? Comparing the Singaporean and Swiss Approaches in Small-State Diplomacy (Yvonne Guo and J J Woo)
• Trade Policy: The Status Quo and The Quo Vadis of Trade Liberalisation (Michael Anliker)
• Small States as Banking Powerhouses: Financial Sector Policy in Singapore and Switzerland (Yvonne Guo and J J Woo)
• Land Transport Policy: Urban Infrastructure in Singapore and Switzerland (Bruno Wildermuth)
• SMEs: Challenges, Potential for Mutual Learning and Implications for Policymakers (Manuel Baeuml)
• Recent Trends in First-Class World Competitiveness: Singapore and Switzerland in Global Entrepreneurship Rankings (Philippe Régnier and Pascal Wild)
• Singapore and Switzerland: Success Stories in Education (Suzanne Hraba-Renevey and Yvonne Guo)
• United in Diversity? Managing Multiculturalism in Singapore and Switzerland (Yvonne Guo)
• Migration Policies: Lessons from the Singaporean and Swiss Experiences (Hui Weng Tat and Cindy Helfer)
• Power Resources and Income Inequality in Singapore and Switzerland (Mehmet Kerem Çoban)
• Conclusion
• About the Authors
• Index
• Reviews of the Book

Readership: Policymakers; undergraduates and postgraduates in political science, economics, and international affairs.

Chapter 1

Public Administration in Singapore and Switzerland

Yvonne Guo and Andreas Ladner

Introduction: Comparing Countries and Administrative Systems

“Both Singapore and Switzerland exist as extreme acts of political will,” declared former head of the Singapore civil service, Mr Lim Siong Guan, during a seminar in Zurich in May 2014. The ‘political will’ he was referring to, however, springs from different sources in both countries. When the Swiss describe themselves as a ‘Willensnation’, they refer to the unity of their nation by free will, the voluntary coming together of linguistically diverse cantons.¹ When Singaporeans talk about ‘political will’, however, they are referring to an ‘elite’ will² to achieve a set of predetermined objectives.

As discussed in the previous chapter, Singapore and Switzerland are politically and institutionally very different. One is a highly centralised state led by a single party and characterised by “top-down” governance, while the other is a highly decentralised state led by a coalition of political parties and characterised by “bottom-up” governance. Yet both Singapore and Switzerland have achieved high standards of public facilities and services, and have an effective civil service and high state capacities. Thus they are interesting cases for comparison using a most-different-systems design. This chapter seeks to pin down why two systems that are structurally so different work for their citizens. Using Scharpf’s concept of “input” and “output” legitimacy, it argues that Switzerland is characterised by “input legitimacy”, while Singapore is characterised by “output legitimacy”.

Role of the administration in society

Public administration plays a crucial role in any society. The civil service keeps the state running and provides the facilities and services needed by citizens. It is here where a government’s decisions and policies are implemented and executed. The way this is done as well as the relationship between the civil service, politicians and citizens, however, varies over time and between countries.

From the perspective of citizens, it is important that they are satisfied with the services provided by their civil service, that they trust in its efficiency and in its impartiality, and that they feel that the civil service is here for them and not the other way round. In Switzerland, despite recurrent claims for reforms and improvements, this is generally the way the civil service is perceived. In Switzerland, 76 percent of citizens reported having confidence in their national government in 2012,³ and comparative studies show that, on the local level, confidence is even higher than in other high-trust countries such as Denmark, Norway and the Netherlands.⁴ In Singapore, 67 percent of citizens reported high trust levels.⁵ According to the Asia Barometer, institutions such as the police, military, government, law courts and civil service enjoy high levels of public trust in Singapore.⁶ Notwithstanding this, political commentators have noted the existence of ‘blurred lines’ between the civil service and politics in Singapore,⁷ with former civil servants frequently running for political office.

A second distinctive element is the recruitment of civil servants. Are they life-time bureaucrats with particular privileges or are they simple employees of the state without extensive additional benefits? Are civil servants recruited on the basis of merit, do they have to pass specific exams, or are they simply employed by different departments on the basis of their competences? Swiss civil servants can best be described as employees of the public sector, generally recruited by their hierarchical superiors in different departments and services.⁸ The civil service is open and based on merit or competencies. No special diplomas or entrance exams are required. Salaries and benefits do not differ considerably from the private sector other than being a bit higher in the lower brackets and considerably lower in the top brackets. In Singapore, the recruitment of most of its 60,000 civil servants is done by individual ministries as well. However, within the civil service exists a group of about 270 Administrative Officers who are rotated throughout different ministries and work closely with the political leadership to formulate policies.⁹ These ‘top-tier’ civil servants undergo a stringent selection procedure. Many of them are selected just after completing their ‘A’ levels, and given full scholarships to pursue their tertiary studies at prestigious universities in Singapore and around the world. In return, they are bonded to the civil service for a period of up to six years. Salaries in the Singapore civil service are also comparable with those in the private sector. However, the salaries of senior civil servants, known as Administrative Officers, are pegged to two-thirds the median salary among the top eight earners from six professions (bankers, lawyers, engineers, accountants, employees of MNCs and local manufacturers). This was justified on the grounds of attracting the best talent and avoiding corruption.

A third element concerns the functioning of the administration and more particularly its internal processes. Especially since the emergence of New Public Management (NPM) — the concept that ideas used in the private sector can be successful in the public sector — the question has been whether public administration functions according to prescriptions, rules and specific resources allocated to different activities or whether there are more output-oriented forms of steering using global budgeting and performance contracts. Although Switzerland started NPM reforms relatively late, they had quite an impact on the functioning of the civil service. Without leaving the traditional Weberian model of bureaucracy completely behind, new NPM-based forms of organising internal processes have considerably influenced the civil service. Similarly, NPM reforms in Singapore’s civil service had an impact on the country’s “developmental state” strategy emphasising national economic development based on state ownership and economic control. The NPM reforms introduced led to the privatisation of state enterprises, the contracting out of services, and the liberalisation of sectors such as finance, telecommunications and utilities.¹⁰

A final distinctive element is the relationship between administration and politics. Throughout the history of public administration there has been debates about whether the administration is really an independent body acting according to laws and regulations, or whether the administration is more closely linked to the political leaders or parties in power. In the latter case, a change of the party in power would automatically lead to a replacement of top-level civil servants with civil servants politically close to the new party in power. Additionally, the question of the autonomy of civil servants is often raised: do civil servants simply execute political decisions or do they also shape and influence them and become political actors themselves?

In this regard, the Swiss civil service is not political but politically influential. Other than for positions very close to the minister, party membership is not a decisive element for promotion and a new minister from a different party does not necessarily lead to top-level civil servants of his party. Civil servants, nowadays, are well-trained experts in their domains. Many solutions to complex problems have to be sought, and especially where international coordination is needed, this information gap tends to play into the hands of civil servants. In Singapore, the close relationship between politicians and civil servants and the frequent movement of civil servants into politics, accentuated by the fact that Singapore has been governed by the same party since 1959, has led to the perception that there is no clear distinction between political and administrative elites. Chan Heng Chee, a political scientist who later became Singapore’s ambassador to the United States, conceptualised Singapore as an ‘administrative state’,¹¹ describing Singapore’s style of government as one which emphasised “the elimination of politics” in favour of placing “trust in experts and expertise in planning and implementation”¹² although this is difficult to prove. In such a context, “senior bureaucrats… are regarded as the natural allies and successors to political leadership”.¹³

Different state and administrative traditions

Governing from the bottom-up in Switzerland

Swiss public administration does not perfectly fit into the common European typologies of administrative systems and is sometimes called a hybrid containing elements of the Scandinavian, the Napoleonic and the Anglo-Saxon models.¹⁴ Characteristic elements are the strong decentralisation giving considerable discretion to the lower state units, the lack of a clear separation between the state and the private sector, and an accessible public service considered to be on eye-level with the citizens.

The history of Swiss bottom-up nation building prevented the formation of a strong nation-state with a large and powerful administration.¹⁵ All the competences the national government and its administration possess today had to be transferred to them through the consent of the people and the cantons at the polls. The cantons jealously guarded their competences and, with them, their particularities in important domains such as education, health and many others, and only reluctantly accepted attempts to harmonise legislation for the whole country. They were, not astonishingly, particularly hesitant to grant the national government the right to levy tax on income and wealth as well as to collect value-added tax (VAT). The highest possible tax rates are written down in the Constitution and cannot be changed without the direct democratic consent of the cantons and the citizens. Where nationwide programs are needed, the national government is responsible for regulatory activities, while the implementation an...

Table of contents

• Cover
• Halftitle
• Title
• Copyright
• Contents
• Foreword by Ambassador Thomas Kupfer
• Foreword by Ambassador Tommy Koh
• Preface
• Introduction and Background: The Trajectories of History, Politics and Economics
• Chapter 1: Public Administration in Singapore and Switzerland
• Chapter 2: Neutrality, Balancing or Engagement? Comparing the Singaporean and Swiss Approaches in Small–State Diplomacy
• Chapter 3: Trade Policy: The Status Quo and The Quo Vadis of Trade Liberalisation
• Chapter 4: Small States as Banking Powerhouses: Financial Sector Policy in Singapore and Switzerland
• Chapter 5: Land Transport Policy: Urban Infrastructure in Singapore and Switzerland
• Chapter 6: SMEs: Challenges, Potential for Mutual Learning and Implications for Policymakers
• Chapter 7: Recent Trends in First-Class World Competitiveness: Singapore and Switzerland in Global Entrepreneurship Rankings
• Chapter 8: Singapore and Switzerland: Success Stories in Education
• Chapter 9: United in Diversity? Managing Multiculturalism in Singapore and Switzerland
• Chapter 10: Migration Policies: Lessons from the Singaporean and Swiss Experiences
• Chapter 11: Power Resources and Income Inequality in Singapore and Switzerland
• Conclusion
• About the Authors
• Index
• Reviews of the Book