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Singapore Budget 2016: Firms must be self-reliant for business growth: CEOs
CLOSE to seven in ten chief executives of companies here say businesses should rely less on government help and more on their own efforts in order to grow, a pre-Budget poll conducted by The Business Times has found.
The poll was emailed to recipients and conducted over seven days, ending on Wednesday.
Respondents, who are on BT's mailing list, are chief executives of firms in Singapore. No breakdown of the size of the firms and the industries they represent were available.
They had to answer "yes" or "no" to five questions on expectations they have of the coming Budget. A total of 117 responses were collected.
In the lead-up to this year's Budget on March 24, segments of the business sector have issued calls for the government to help them defray costs, boost innovation, and raise productivity amid slowing growth.
The Ministry of Trade and Industry (MTI) said that Singapore's gross domestic product (GDP) saw 2 per cent growth in 2015 - its weakest showing since 2009, when the economy was hit by the global financial crisis. MTI estimates growth this year to range from 1-3 per cent.
Amid this backdrop, 69 per cent of the CEOs who responded to BT's poll said that the onus is on companies themselves to sustain their own business.
Yet at the same time, 69.2 per cent also said that helping businesses is more important than social measures in the coming Budget.
"It's not contradictory," said Song Seng Wun, economist at CIMB Private Banking. "It's a useful reminder that businesses still have to take matters into their own hands when looking at growth. But during a period of slower growth, obviously you do not want viable businesses to struggle and start laying off workers."
Respondents' expectation of a focus on businesses in this year's Budget also comes as previous Budgets have seen a plethora of social measures being introduced, said OCBC economist Selena Ling.
But she cautioned against the notion that a focus on one aspect necessarily entails reducing funds in another area.
"It's not an either-or thing," she said. "If you look at previous recent Budgets, the focus was very much on social measures. But there were also commitments to large infrastructure projects like the airport's Terminal 5."
Funds were also channelled into the transport sector and logistics, Ms Ling noted. "It's just that prominence was given to the social measures," she added.
In this sense, slowing economic growth will put the spotlight on business-related measures in the coming Budget.
Already, the CEOs who responded to BT's poll are expecting some form of pain relief.
About two-thirds - 65.8 per cent of them - think that foreign worker levy hikes will be deferred again in this Budget. Already, the increases were deferred by a year in 2015's Budget.
A large majority (82.1 per cent) also foresee that the government will introduce some stimulus measures.
Separately, they are considerably more ambivalent about taxing the wealthy more so as to fund social spending, with 52.1 per cent rejecting the idea.
In last year's Budget, it was announced that marginal tax rates will go up for the top 5 per cent of income earners, who earn at least S$160,000 a year. This will be applied on taxes to be paid starting in 2017.
"This tax increase for high-income earners will enhance progressivity and strengthen future revenues," said Deputy Prime Minister Tharman Shanmugaratnam, who was also finance minister then.