SINGAPORE: All of the unexpected budget surplus from the financial year of 2017 has been shared with Singaporeans in various ways, said Second Minister for Finance Lawrence Wong who urged the SG bonus to not be viewed “in isolation”.
As announced in the Budget statement, Singapore is expected to see an overall budget surplus of S$9.61 billion for the year ending Mar 31. This is more than five times above the S$1.91 billion official estimate, thanks largely to exceptional statutory board contributions and higher stamp duty collections.
The entire additional S$7.7 billion above the official estimate is being given back to Singaporeans in various ways, instead of just the S$700 million SG bonus, Mr Wong stressed, as he addressed Nominated Member of Parliament (NMP) Azmoon Ahmad’s suggestion for the Government to share more of the unexpected budget surplus.
“We don’t save surpluses. We give them all back to Singaporeans but we give back in different forms,” said Mr Wong in Parliament on Tuesday (Mar 6) during the debate on his ministry’s budget.
“Some will be for spending (on) future needs. Some will be spending for current needs… and some will be through a direct transfer, like the SG bonus,” he added, urging for the surplus to be viewed "in totality".
Mr Wong cited the setting aside of S$5 billion for a Rail Infrastructure Fund “which will benefit all MRT commuters”, and S$2 billion for premium subsidies and other forms of support when the ElderShield review is complete.
“These premium subsidies for lower- and middle-income Singaporeans will ensure that the enhanced ElderShield scheme remains affordable and the premium subsidies will directly benefit these individuals and their families."
As such, the SG bonus, which distributes up to S$300 each for all Singaporeans aged 21 and above this year, should not be viewed “in isolation".
Mr Wong also raised the example of other existing social transfers, such as the GST Voucher, U-Save Rebate and Service and Conservancy Charges (S&CC) Rebate.
Over the years, the Government has also enhanced its permanent schemes in various areas, such as housing and healthcare, with more assistance targeted at the lower-income group.
“The support we provide to Singaporeans who need help goes beyond the SG Bonus and these direct transfers schemes,” he said.
In his speech, Mr Wong also touched on the Government’s overall funding approach and stressed that even as it considers borrowing for certain major infrastructure projects, it will “do so prudently and on a selective basis”.
This means that it will “borrow for the right projects”, namely those that generate adequate future revenue streams to repay the borrowing, said Mr Wong. One example would be the Changi Airport Terminal 5, he added.
“If we are not careful and selective in borrowing, we may end up over-burdening ourselves with rising interest costs and that’s not what we intend to do.”
Therefore, there will still be capital projects the Government will continue to fund through development expenditure from the annual budget, said Mr Wong.
For FY2018, the share of development expenditure is “slightly higher” at around 28 per cent of the total budget, the minister added.
Moving forward, development expenditures will rise amid continued investment in infrastructure and other capital projects. In the meantime, operating expenditures are also poised to increase on the back of spending in areas like healthcare and security.
“We will continue to monitor this share between operating and development spending. It’s an important balance… and it’s critical we get the balance right,” said Mr Wong.