Budget 2023 debate: Lawrence Wong sums up and replies to MPs

Putting together Budget 2023 has been a "delicate balancing act of finding that sweet spot", said Deputy Prime Minister and Finance Minister Lawrence Wong. He said Singapore wants to get back to a more sustainable fiscal position but it cannot taper down support too quickly because the economic outlook remains uncertain. At the macro level, Budget 2023 is expansionary, providing some support for what is likely to be a weaker economy this year, he said. Summing up the debate on the Budget for the new financial year in Parliament on Friday (Feb 24), he addressed questions raised by members broadly around three buckets of issues. Firstly, whether the Government is taking too much and giving back too little and whether it has any fiscal slack. Mr Wong said the short answer is "no". He said the Ministry of Finance will continue to monitor revenue and expenditure trends closely but the bottom line is that Singapore's tight fiscal position is very much a reality over the medium term. He said besides having a diversified revenue base, the Government also pays attention to the overall tax burden, and after factoring in the changes in Budget 2022 and 2023, including the full GST increase, Singapore's tax to GDP ratio is 14 per cent. This is considerably lower than those of most other advanced economies, he said. He pointed out that during the pandemic, resources were channelled towards the more urgent task of fighting COVID-19. These funds now have to be channelled back to what they were originally meant for. "So there is no slack here," he said. He added that the system is designed to create and maximise opportunities for all, but recognises that outcomes in life will not be equal. Moving on to the second basket of issues, which revolve around the economy and whether Singapore is staying competitive and helping businesses and workers sufficiently, Mr Wong said Singapore remains focused on growing the economic pie. Only then can it have the resources to redistribute, strengthen its social compact and progress. Mr Wong said Singapore is moving forward from a position of strength, seeing healthy flows of investments, capital and talent, as well as seizing these opportunities to build capabilities and strength. He stressed the need to build on the country's strong foundations and leverage its competitive advantages fully while managing its inherent and permanent constraints, especially in the areas of manpower, land and energy. He said workers will always be at the heart of Singapore's economic strategies, with employers, unions and the Government working together to advance the well-being of Singaporeans to build a better future. Turning to the third bucket of issues, which is about whether the Government is doing enough to help Singaporeans and households in need, Mr Wong highlighted the comprehensive measures to cope with higher prices. He said while the focus is on the lower-income groups, the help also extends to the sandwiched and middle-income families. That is why the Government has designed its packages to provide more help to larger families which have young and elderly dependents. He stressed that the Government is doing more to uplift vulnerable groups, as part of a broader review to strengthen Singapore's social compact with new strategies and impactful solutions. Concluding, Mr Wong said the Budget is not just about dollars and cents, winners and losers or pitting the well-off against the rest of society. Instead, it reflects Singapore's values as a people and its unwavering commitment to build a fairer, more inclusive and ever more just society. "Our solidarity and our values are our deepest strengths. They are what make Singapore work. They have kept Singapore going through good years and bad and they will enable us to secure our prospects and build a better future together as one united people and as one Singapore," he said.