The Budget Debate is well underway, and there have been ample discussions over “who gets what”.
However, there is something more important than slicing the pie.
According to Bukit Panjang SMC MP Mr Liang Eng Hwa, budgets must also be about how we can grow the pie bigger.
That is because a responsible Budget goes beyond handouts. Instead, it should grow and multiply like spores so that there is more to share in the years to come.
The importance of being prudent
Singapore is a wealthy nation, but our wealth did not manifest from nowhere.
It was built through fiscal prudence to act as our insurance policy to guard against future contingencies.
As Mr Liang said, we need the financial firepower to respond to more disruptions and external shocks, which can be even more impactful than the pandemic that we have just experienced.
In the same vein, West Coast GRC MP Ms Foo Mee Har told the House: “We need the fiscal buffer to give ourselves enough capacity to deal with future shocks, including black-swan events like the Covid-19 pandemic.”
Singaporeans have suffered over the pandemic. But as Tanjong Pagar GRC MP Ms Joan Pereira mentioned, “the full force of the crisis had been mitigated by decades of careful savings and implementation of sound measures.”
How to grow the pie
In the Occasional Paper on Medium-Term Fiscal Projections, the Ministry of Finance has projected that Government spending is expected to increase to around 19 per cent to 20 per cent of GDP in the FY2026–2030 period, and possibly exceed 20 per cent of GDP by FY2030. The key drivers include health and social care, education and wage subsidies to uplift lower-income Singaporeans.
But as Choa Chu Kang GRC MP Mr Zhulkarnain Rahim mentioned, we must continue to maintain fiscal discipline and prudence in our spending and in terms of generating more reserves.
So how do Budget 2023 purport that we grow the pie? By turbocharging business growth, of course.
As Ang Mo Kio GRC MP Ms Ng Ling Ling shared, the S$4 billion top-up to the National Productivity Fund will help us attract more investments, improve productivity measures, and empower our workers through continuing education and training.
These initiatives will help to generate a vibrant economy, which not only creates good jobs and be the best welfare for workers to counter inflation, but it will also grow the economy to generate future revenue, said Mr Liang.
Insurance against future shocks
The magic of Budget 2023 is not only the immediate support it gives but the multiplier effect it will generate.
Rather than dispense snake-oil remedies promising miracle cures, the PAP Government believes in implementing pragmatic long-term measures that will improve the lives of all Singaporeans while maintaining fiscal sustainability.
Our pioneers took more than 50 years to save up this pot of gold because they want to protect future generations, said MacPherson SMC MP Ms Tin Pei Ling.
And while we must draw on our reserves to help Singaporeans through difficult times, we cannot deplete them. Instead, we must guard it judiciously, added Ms Tin.
“Could the DPM give commitment that the money taken out of Past Reserves will be put back at the earliest opportunity to do so, and if not at one go, at least in phases?” she asked.
Deep down, Singaporeans must know that our reserves are not infinite.
While we might imagine a vault full of gold where Scrooge McDuck could dive in, we cannot keep tapping into our reserves to fund our spending because what will happen when we run into bigger and bigger deficits?
Now more than ever, Singapore will need all the ammunition it needs to prepare for two of the biggest threats confronting humanity – climate change and geopolitical tensions.
Quoting Mr Liang: “Sound and prudent fiscal management today will enhance our survivability, give us the safety cover when needed and position us strongly for the opportunities in the new era.”
Cover Photo Image: MCI/YouTube
