Budget 2014: S'pore posts higher surplus for FY2013; will see small deficit for FY2014
- POSTED: 21 Feb 2014 15:40
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Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam started his Budget 2014 Speech on Friday, saying Singapore is expected to have an overall surplus of S$3.9 billion, or 1.1% of GDP, for FY2013.
SINGAPORE: Singapore is expected to have an overall surplus of S$3.9 billion for FY2013, Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam said in his Budget 2014 Speech on Friday.
The surplus is 1.1% of GDP, and higher than the S$2.4 billion, or 0.7% of GDP, surplus a year ago.
Mr Tharman attributed the higher surplus to a few factors, including temporary delays in implementation of public infrastructure projects.
Revenues were also boosted by higher vehicle quota premium collections.
The stronger fiscal surplus was due mainly to cyclical factors, which would not last, he said. Singapore should see a tighter budget position in the coming years.
Singapore is expected to record a small overall budget deficit of S$1.2 billion in financial year 2014 as authorities spend more on healthcare and social services.
According to revenue and expenditure estimates for the financial year beginning April 2014, government spending will rise by S$4.3 billion, or 8.3 percent, outstripping the expected 4.1 percent rise in operating revenue.
The Ministry of Health will see its budget rise by S$1.3 billion to S$7.1 billion -- an increase of 23 percent that will allow for more patient subsidies as well as additional funds for training and retaining healthcare professionals.
As in previous years, the Defence Ministry continues to get the biggest share of the Budget at S$12.6 billion. But it is a relatively small increase of around 3 percent from last fiscal year's S$12.2 billion.
At the Ministry of Culture, Community and Youth, the budget will rise by more than 40 percent -- from S$1.4 billion to S$2 billion. The increase is partly due to payments involving the Sports Hub and initiatives under the Arts and Culture Strategic Review.
Despite the increase in government spending, Singapore's fiscal position remains healthy.
Finance Minister Tharman said the overall budget deficit of S$1.2 billion works out to around 0.3 percent of GDP.
"This is close to a balanced budget, and will not result in a draw on past reserves as we have sufficient surpluses from the last few years," he added.
The Singapore economy grew by 4.1% in 2013, up from 1.9% a year ago, supported by improving external environment and strong domestic construction growth.
However, the global outlook for 2014 is uncertain – the advanced economies are gradually recovering, while the emerging economies are slowing. But the odds are against a sharp slowdown in the global economy.
Hence, MTI expects the Singapore economy to grow by 2% to 4% in 2014, said Mr Tharman.