Singapore used 20 years of previous budget surpluses to combat Covid-19: DPM

Singapore

SINGAPORE has drawn on its reserves - equivalent to over 20 years of past Budget surpluses - to fight the Covid-19 pandemic, said Deputy Prime Minister and Finance Minister Heng Swee Keat on Friday.

"We have used a generation's worth of savings to combat a crisis of a generation. We must therefore ensure that our fiscal balance is put back on a stable path when the economy recovers," he wrote in his ministry's addendum to the President's Address.

He said the government will take steps to strengthen its revenue position, and will do so in a way that fosters collective responsibility, with each generation contributing its "fair share". One way is to raise the goods and services tax (GST), but he reiterated that the increase will not come next year.

"We will continue to steward the reserves well to prepare us for future shocks and crises, and to invest them for long-term returns that will be shared equitably between present and future generations," he said.

Mr Heng said Singapore remains committed to a fiscal system that is "fair and progressive", with the better-off contributing more, and lower- and middle-income households receiving more in benefits than the taxes they pay.

"We will continue to adjust taxes on income, consumption and assets to achieve the right balance, while keeping our tax rates competitive," he said.

In a separate addendum issued by the Prime Minister's Office's (PMO) Strategy Group, he spoke about the need for a "well-coordinated, whole-of-government" approach to navigate through the crisis and "build back a better Singapore post-crisis".

The Strategy Group said it would continue to support Singaporeans in their parenthood aspirations and support families, particularly in the areas of housing, pre-school, parental leave and the cost of raising children.

In his ministry's addendum, Minister for Culture, Community and Youth Edwin Tong said it would kick off the "Emerging Stronger Conversations" to provide Singaporeans, including youth, a platform to reflect on their experience with the crisis, share their aspirations for the country and work together to build a stronger society.

His ministry will take a holistic approach and team up with relevant players in growing volunteerism through the SG Cares movement, to build a caring and cohesive Singapore. It will also partner stakeholders in the arts, heritage and sports communities to unite Singaporeans, inspire them and celebrate the Singapore spirit.

The PMO's Public Service Division (PSD) said it would organise the Public Service differently to improve problem solving beyond agency boundaries, such as through more cross-agency teams. The PSD's Science and Technology Policy and Plans team wants to "aggregate science and technology demand across the whole-of-government for greater efficiency", said Minister-in-charge of the Civil Service Chan Chun Sing.

The Smart Nation and Digital Government Group, on its part, aims to make digital services accessible to all Singaporeans and build up the national digital infrastructure, platforms and standards to support digital transactions and commerce. Vivian Balakrishnan, the minister-in-charge of the Smart Nation initiative, said all government services will be digital from end-to-end by 2023, as committed to in the Digital Government Blueprint.