Singapore must be disciplined about reserves: SM Goh
By S Ramesh, Channel NewsAsia | Posted: 01 February 2009 1802 hrs

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	Special Report • Singapore Budget 2009

SINGAPORE : Singapore's Senior Minister Goh Chok Tong has said the country must be disciplined and not dip into the reserves at the first sign of trouble.

And responding to suggestions that the government had broken the piggy bank in the recently announced Budget, Mr Goh also related three situations where Singapore should not draw on the reserves.

He was speaking at his Marine Parade constituency's Lunar New Year event on Sunday.

Mr Goh said that Singapore's Finance Minister Tharman Shanmugaratnam and his officials were like a team of doctors. And before they could prescribe the right medicine to cure the economic ills, they must make the right diagnosis.

The team also has the collective experience of government leaders who have brought Singapore out of five previous recessions - from 1965 to 2003 - to deal with the current one, the worst since 1964.

Mr Goh said: "In past recessions, no matter how difficult life was, we took the medicine, workers swallowed the bitter medicine prescribed, and worked hand-in-hand with the government to tackle the challenges, and the whole population rallied behind the government to pull the economy out of the recession.

"Likewise for this recession, we must confront our problems squarely, endure short-term pain and plan for the long term."

Sounding optimistic despite the challenges ahead, Mr Goh assured Singaporeans the government will help them cope.

Among the unprecedented steps taken is using a portion of past reserves for the Resilience Package.

But that is not breaking the piggy bank.

Mr Goh said: "To break the piggy bank is to allow all the notes and coins to spill out, with no controls over the expenditure. We are not doing that."

Mr Goh is also clear about not touching the reserves for three things.

He elaborated: "(First, there should be) no use of the reserves to support social assistance programmes. I am not saying there should be no social assistance programme. As a general principle, such programmes must be funded out of revenues raised in the current term of government, not past reserves.

"Second, (there should be) no draw for permanent programmes like Workfare and ComCare. Third, (there should be) no draw except under dire circumstances when one-off extraordinary measures are required to ward off a catastrophe or prevent irreparable damage to the economy."

The Year of the Ox may have coincided with previous recessions of 1997 and 1985. But Mr Goh reminded Singaporeans that the Ox has shown its ability to survive them.

And Mr Goh is confident that if Singaporeans worked together, the country will emerge from the economic crisis stronger than before. - CNA/ms