The Singapore system is by contrast completely sustainable.

It's a lie that Western countries' safety nets are unsustainable. If a nation that is sovereign in its own currency wants to pay out more in social security it can. The only risk it has to face is higher inflation, and I don't know if you've noticed but inflation is running close to zero almost everywhere in the west.

The western nations that have adopted a "social security must fund itself" approach like Singapore's have done so because business lobbies demanded it, not because it was needed. The business lobbies have a vested interest in keeping inflation and wages low. Suppression of social security does both. "Sustainability" is just the faith-based economics rationale for this policy.

Singapore's close to non-existent safety net is close to non-existent for the same reason. It keeps Singapore's workforce weak, docile, pliant and underpaid (seen how much you'd get paid if you moved to Australia?). The government, of course, doesn't use those terms to describe this process. It uses euphemisms like "lean" or "globally competitive" or "flexible labor markets". Foreign capital loves cheap and obedient labor and the SG elites know that attracting foreign capital means $$$ for them.

Singapore will never have the economic issues now being faced by Europe and the US.

Austerity in most western countries is a self-inflicted illness. It's done mainly to crush the power of the working classes, and it works wonderfully at doing that (the stock market usually signals its approval with a bump). Austerity -> fewer jobs -> a more desperate work force willing to take more shit for lower wages -> higher profits.

The Singaporean government has no need to crush the spirit of hawkers and factory workers. Job done already.

Furthermore, if the Singaporean government did decide for some reason to keep youth unemployment at 45% like Spain does then it would probably find itself facing widespread social unrest. Widespread social unrest the likes of which Brazil, Greece and Spain face simply isn't something you can handle in a city state (note the panicky over the top response that the SG government had to all of the riots in its history).

So, they keep unemployment low and steady, with Keynesian stimulus where necessary, which keeping Singapore's workforce "lean", "mean" and "globally competitive".