Amid global uncertainty, experts question if Singapore's "status quo" budget does enough to tackle inequality, AI disruption, and the pressures families feel.
In what has become an annual event, the Social Inclusion Project (SIP) at the Lee Kuan Yew School of Public Policy (LKYSPP), held a panel discussion on February 13 to dissect Singapore’s 2026 budget from the perspective of building a stronger and more inclusive society.
The conversation was moderated by Dr. Ng Kok Hoe of SIP and featured a diverse group of academic experts, including Dr. Shin Bin Tan from LKYSPP, Dr. Jacqueline Ho and Dr. Nathan Peng from Singapore Management University (SMU), and Dr. Teo Youyenn from Nanyang Technological University (NTU). Together, the speakers analysed the strengths of the current budget while identifying critical gaps that must be addressed to further strengthen Singapore's social fabric.
While 2024’s budget was quite “busy”, in the wake of the Forward Singapore Exercise, and represented a policy shift, Ng Kok Hoe Senior Research Fellow and Head of SIP called 2026 a “status quo” budget with no new initiatives in social policy, merely tweaks and small adjustments.
Overall, the 2026 budget reflects a level of uncertainty for the future. As Prime Minister and Minister for Finance, Mr Lawrence Wong said in his budget speech, we are in a time of “profound global change.” The international order of the past 80 years is breaking down and the world “is becoming more contested, more fragmented, and ultimately more dangerous.” 2026 sees signs of fragility in the global economy. Singapore has projected a lower rate of growth between two to four per cent, with inflation at one to two per cent.
In that environment PM Wong said the budget, “lays the groundwork for how we will navigate our next phase of development,” which notably focusses on harnessing Artificial Intelligence (AI) as a strategic advantage.
Going boldly towards AI
The panellists viewed the budget’s heavy focus on Artificial Intelligence as evidence that the “AI train is leaving the station” and Singapore needs to be on it. Tan Shin Bin, Assistant Professor, Lee Kuan Yew School of Public Policy said the government is moving towards AI with boldness and confidence and that hopefully future budgets will see similar boldness and confidence in addressing any shifts in inequality and social mobility caused by AI.
Nathan Peng, Assistant Professor of Political Science (Education), SMU adopted a more cautious stance by highlighting the structural challenges posed by automation. He observed that becoming proficient in AI may not be a complete safeguard against job displacement if firms shift their operational models from “hiring five workers who do not use AI to one worker who uses AI extremely well.” This perspective suggests that while individual upskilling is valuable, it may not fully offset the broader trend of workforce consolidation driven by technological advancement.
Jacqueline Ho, Assistant Professor of Sociology, SMU similarly pointed to a central paradox: we are adopting AI to solve a tight labour market while simultaneously fearing the mass displacement of workers it will cause. This tension, she warned, is particularly dangerous in caring professions like nursing and teaching, where automating human interaction under the banner of efficiency strips away what Allison Pugh in “The Last Human Job” calls connective labour—which relies on empathy and human contact.
Education and fertility
Another justification for Singapore’s push towards AI is its rapidly aging population, which is related to both fertility and education, two subjects that got scant attention in this budget according to Professor Ho. She noted that fertility remains a key issue, as the cost of raising a child, driven by academic competition, influences family decisions.
Looking ahead, she highlighted upcoming reviews of the primary school registration framework and high-stakes exams, like the Primary School Leaving Examination (PSLE). These reviews are critical since education remains "the key means to which we enable social mobility."
She expressed a desire for bolder thinking on school mixing and class sizes, arguing that 40-pupil classes prevent teachers from making students "feel seen," and warned against turning too quickly to technology as a solution for teacher workload.
Inequality vs the "scary" big picture
Professor Tan observed that while the budget speech painted a "dire picture" of global instability, technological change, and polarisation, it did not frame inequality or slowing social mobility as major challenges. Instead, inequality was presented as something Singapore has made satisfactory progress on.
She argued that this perception that inequality is "settled" explains why the rest of the budget feels like "business as usual." Policymakers, she suggested, believe the current social policy framework is "good enough.
However, she warned that the "scary" external threats (global instability, aging population, tight labour market) mean that standing still is risky. Even if inequality is manageable now, the seismic shifts on the horizon require more than incremental tweaks.
In her domain of housing and the built environment, she called for more experimentation and genuine community participation, particularly in reaching the voices "who typically don't come out" to engage with policymakers.
Professor Peng structured his analysis around two budget thrusts: ensuring a healthy economy and helping those who fall behind. He questioned whether current measures are enough to close the gap.
He acknowledged that Singapore's macro-level inequality numbers are a "statistical anomaly" among developed countries—a sign of success. However, he noted a troubling paradox: relative social mobility is declining (fewer children from poorer families are reaching top income tiers), and the public does not feel the prosperity.
He identified the wealth gap as a key concern. He said that the SGD 1,500 top-ups for seniors’ Central Provident Fund (CPF) are helpful, but that they come too late in life to benefit from compound interest and may not meaningfully close the gap.
His core argument focused on education and meritocracy. He said that higher-income families are spending more of their income on tuition, translating wealth directly into "merit." This, he warned, is undermining the fundamental social compact: that hard work and talent, not family background, determine success.
He called for a serious examination of how to increase social mixing in schools, and a collective effort to be "kinder to those who lose in the meritocratic race."
Valuing humanity
Associate Professor Teo Youyenn, Provost’s Chair in Sociology and Director, Centre for the Study of Social Inequality, NTU and author of the influential book, “This is What Inequality Looks Like” wrapped up the analysis of the budget and the panellists’ comments.
“When technological changes happen quickly and there are strong market players and moneyed interests involved, issues of ethics and social protection can, and have, in the past been regarded as secondary or periphery to questions of expediency and economic gain,” she said. Emphasising that at some point in their life, every human will have been cared for, and most will also be a caregiver, she concluded, “A flourishing economy must also be one in which flourishing is not conditional on market participation. When we are not workers, we nonetheless contribute to society, and we should be valued as such.”
What is evident from the panel’s analysis is that while the 2026 budget provides a steady hand amidst global volatility, its "business as usual" approach to social policy may not be enough to meet the seismic shifts on the horizon. From the potential for AI to reshape the labour market to the persistent pressures of the "meritocracy race" in education, the experts highlighted a growing gap between macroeconomic success and the lived experience of many Singaporeans. The discussion underscored that building a truly inclusive society requires more than incremental fiscal tweaks; it demands a bold re-evaluation of how we value human labour, care, and social mobility in an increasingly automated and fragmented world.