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Finite Budget 2017 resources means fine balance must be struck: Chun Sing

As he explains the focus on mid-term goals in the latest Budget, MPs also call for 'compassionate' and 'deeper' engagement by the government to preserve trust
Thursday, March 2, 2017 - 05:50

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Chan Chun Sing said "If we're political leaders, we have to face the issue squarely: in every society, how do we distribute the finite resources?"

Singapore

THERE is only a finite amount of resources to go around, so the latest fiscal budget should be seen in the context of how it can help tackle future challenges - even as previous measures continue to provide support, Singapore's Parliament heard on Wednesday.

This line of reasoning came in response to a call from some quarters of the House for the government to go deeper in its engagement for Budget 2017 so that trust in society is preserved.

Chan Chun Sing, Minister in the Prime Minister's Office, said halfway through the eight-hour debate on Wednesday: "If we're political leaders, we have to face the issue squarely: in every society, how do we distribute the finite resources?

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"How do we make that statement that we, as a society, will lean forward to help those that need a bit more help?"

In her speech near the end of the day, Nominated MP Kuik Shiao-Yin said that in times of slower growth, such as what Singapore is going through now, the government will have to adopt a more empathetic outreach to explain why it prioritises certain segments of the economy and society over others.

"When you are in that claustrophobic space of anxiety and scarcity, you don't have enough mental bandwidth to deal with anything more than each day's demands," she said.

"That's why compassionate communication of available solutions rather than a 'Don't know, go talk to your MP' approach by front-line officers matters so much."

Wednesday was the second day of debate in the House on Budget 2017; the perceived lack of short-term support in the fiscal budget unveiled last week continued to dominate the proceedings.

Budget 2017 was unveiled just after an economic restructuring report was issued; it also came at a time when Singapore's economy had charted 2 per cent growth in 2016 - low by historical standards.

The confluence of structural and cyclical challenges has hurt businesses and households. Many who were looking for some immediate relief in Budget 2017 were disappointed.

On Wednesday, 32 Members of Parliament (MPs) and two Cabinet ministers attempted to contextualise Finance Minister Heng Swee Keat's budgetary plans last week as a prudent one that focuses on future capabilities to help firms, workers and the economy grow stronger.

Mr Chan stressed that the government has to strike a very fine balance with the fiscal budget every year.

Thus, with external realities becoming more unpredictable and technological disruption cycles becoming more rapid, there is an urgent need to equip Singapore's workers, companies and the government with the skills to ride through these disturbances.

This explains the lack of near-term relief in Budget 2017.

Speaking in his capacity as labour chief, Mr Chan said: "Grants and subsidies alone won't create jobs - especially sustainable jobs. The crux must come from our businesses, our access to markets, our innovation."

And in order to achieve these, Budget 2017 introduced measures to encourage innovation, help companies gain access to overseas markets, spur workers to upgrade their skills, and review Singapore's regulatory environment to foster growth of new businesses and sectors.

Budget 2017 should also be seen in the context of previous budgets, which had put in place support measures, the benefits of which continue to be felt today, said Mr Chan.

These "long tails" of earlier measures continue to help Singaporean firms and households today, he said, echoing an observation by Minister for Industry S Iswaran on Tuesday. Examples include Workfare, the GST (Goods and Services Tax) Voucher, the U-Save rebates and the SkillsFuture framework.

But with each long tail comes smaller manoeuvring space for the government in the present too, said Mr Chan; this is because these earlier commitments continue to weigh on government's coffers. For example, some 460,000 Singaporeans are expected to receive S$770 million in Workfare Income Supplement for work done in 2017.

He said: "So it is not just the new things that are important. It's also what has been going on and will continue to go on that will define this Budget."

Many MPs on Wednesday acknowledged the need for the government to stay prudent with its fiscal resources. This means that some areas of the economy and society will get more help than others, like the customised support Budget 2017 has lined up for some sectors.

But some MPs also said that more compassion should be shown when the government and public servants communicate with the public.

Nee Soon MP Louis Ng reminded the House that as the government fine-tunes its running of the country, it should also remember that its policies will not be able to cover all the ground.

"Our aim seems to be to process each case as fast as possible and to follow the book as strictly as possible.

"Unfortunately, many people fall through the cracks when the system is so rigid, when we view things in black and white and where compassion is not exercised regularly enough," he said.

For Ms Kuik, a more understanding approach from the government will get more buy-in from the public, thereby ensuring that Singapore does not go down the fractious road that has led to the rise of populism in other advanced economies.

"I believe there are many taxpayers and voters on the ground who still need to be more honestly engaged and deeply convinced that this system's story is genuinely about Moving Everyone Forward Together, not just Moving Some of Us Forward Together," she said.

"We need more open and honest conversations on this front.

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