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An economy of words

Yesterday's Budget statements offer clues to today's dominant issues

[SINGAPORE] The singer Bob Marley once crooned, "In this bright future, you can't forget your past".

As Finance Minister Tharman Shanmugaratnam prepares to deliver Singapore's next Budget on Feb 21, a look back at the most frequently used words in the last 10 Budget statements shows how productivity and inclusiveness became key areas of focus over the past few years. The analysis also reveals the complexities of some of the issues, such as foreign- worker policies, that have occupied the nation.

INFOGRAPHIC: Click here for 10 years of Budget Speeches

In the years since the Global Financial Crisis, two dynamics have dominated Mr Tharman's annual Budget speeches: raising productivity on the one hand, and inclusiveness on the other.

Beginning in 2010, a $2 billion National Productivity Fund was created as the country emerged from recession and turned towards the future. The efforts were emphasised in 2011, when the goal of raising real incomes by 30 per cent over 10 years was stated. In 2012, foreign-worker quotas were cut, and in 2013, those policies were tweaked but not substantially relaxed despite loud complaints from certain industries.

"We are no longer a developing economy, but we have not achieved the level of productivity and income of an advanced economy," Mr Tharman said in 2013.

But the government has also sought to balance the productivity drive with stronger social initiatives for the young, the old and the poor centred around the buzzword "inclusiveness". The elder segments of the population, in particular, have seen initiatives targeted specifically for them in the past three Budgets.

Although past Budgets have mostly sought to be progressive, inclusiveness has not always been a big issue. The 2004 Budget, for example, was notably a business-friendly package aimed at rejuvenating the economy, which was just emerging from the 2003 outbreak of the Severe Acute Respiratory Syndrome (Sars) crisis and the 2001 bursting of the tech bubble.

It was in that light that then-Deputy Prime Minister and Finance Minister Lee Hsien Loong announced the creation of the S Pass for skilled foreign workers to address businesses' struggles with finding talent. Keeping the foreign-worker spigot too closed would crimp the economy's ability to expand, it was reasoned.

"For our economy to grow, companies must be able to recruit skilled workers," Mr Lee said.

The rhetoric is different these days. In 2012, with the heartland still smarting from major MRT train disruptions, Mr Tharman said: "Our increasing dependence on foreign workers is not sustainable. It will test the limits of our space and infrastructure, despite our efforts to build more housing and expand our public transport system."

The analysis of past Budgets also unearths interesting nuggets about the Global Financial Crisis. The 2007 Budget was clearly optimistic, with the looming housing crisis in the United States seen mostly as a serious but distant risk. A year later, those concerns had grown to the extent that the 2008 Budget was relatively conservative and appeared to be storing surpluses for a rainy day.

That conservatism proved to be wise as the crisis hit in 2008. Even so, the 2009 Budget showed how accurate forecasting can be a challenge for even the best of us.

"Like other governments and the vast majority of private forecasters, we did not anticipate the speed and scale of the deterioration in the global economy in the last six months," Mr Tharman said in 2009.