Sworn in as minister for labour and foreign affairs on 16 April 1968, Raja now took main responsibility for some of the biggest challenges facing the country. The most pressing related to his labour ministry brief: tackling unemployment and lifting the standard of living. Both problems provoked constant political heat and were sources of mass discontent.
As pressurising were his foreign ministry priorities of managing regional relationships to help maintain stability and security, and building international confidence. Otherwise, economic development would be elusive.
In Raja’s mind, the security issues were more difficult to resolve than the economic ones. But right now, they were equally taxing on his time, energy and imagination. The country would face radically new problems that required new approaches and methods, he believed. “Because of the British withdrawal in 1971, Southeast Asia will become an increasingly turbulent area, and there will be mounting economic distress and growing political instability around us,” he said.
The new labour minister found himself standing on the brink of a labour crisis so dire that it could only be remedied by radical and painful reform. Everyone knew that leading such a hot ministry was treacherous business. But this was precisely why he was chosen for the job, Lee Kuan Yew said later. “I knew that he would not be intimidated by the problems and would take them on,” said the PM.
The figures illustrate the sheer challenge of Raja’s undertaking: over 10 per cent of the labour force of 500,000 unemployed, at least an equal number underemployed – and another 100,000 workers set to lose their jobs when the British pulled out. Additionally, about 25,000 school leavers entered the labour market each year. Yet, despite the country’s economic growth of 9 per cent per annum for the last three years, only about 5,000 jobs were created a year – nowhere near what would be required.
It was all hands to the economic pump. Goh Keng Swee, Singapore’s chief economic architect, had left his defence post to return to the Treasury in August 1967. In a radio and television broadcast in March 1968, he warned that if things were allowed to take their natural course with the British rundown, the result would be a “severe and protracted recession”. The policy of the government, he said in his usual clinical tone, was to prevent this recession.
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