Government to re-evaluate spending as Singapore adapts to living with Covid-19

THE government is re-evaluating its spending in areas such as infrastructure and office spaces, as Singapore moves to adapt to living with Covid-19.

The Ministry of Finance (MOF), in its response to a report by an 8-member committee recommending that the government do so en route to Singapore becoming a Covid-resilient nation, said it regularly reviews the government's expenditure needs, and that it has already started to work with agencies to review the impact of Covid-19 on the government's future plans.

The Public Accounts Committee in its second report to Parliament on Wednesday (Jan 26), acknowledged that some increases in Covid-related expenditures - such as in healthcare - are still expected, but that there are opportunities to reduce spending in other areas.

In putting up the report, the committee had considered the Report of the Auditor-General for the Financial Year 2020/2021 and discussed issues which could affect the government's spending, financial governance and controls in the public sector as a result of the pandemic.

In its response, the MOF said that, in the area of infrastructure planning for example, it would "preserve optionality and flexibility" in allocating resources for infrastructure projects, given the manpower challenges brought about by the pandemic.

The government had previously moved resources from some construction projects towards funding Singapore's Covid-19 response, causing delays to public infrastructure projects such as Build-to-Order Housing and Development Board (HDB) flats.

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While the agencies are working on prioritising and minimising further delays, the MOF said it remains uncertain in the medium to longer term how much infrastructure use and design would fundamentally shift due to Covid-19.

"As a global city, Singapore must remain an attractive hub for talent and companies. The necessary upgrades to Singapore's connectivity, livability and economy would still be largely needed," it said.

However, the ministry said that in areas where the government is certain demand would be dampened or significantly delayed, it would be flexible, citing as an example the government's decision to pause the construction of Changi Airport Terminal 5.

The MOF said that, with public-sector office spaces, there is "opportunity to optimise the government's office space take-up as hybrid work becomes more prevalent", noting that several agencies have already moved in that direction.

Still, it pointed out that sufficient space is still needed for safe-distancing.

And given the fluid nature of the pandemic, agencies are still monitoring the developments, and carefully assessing the impact that different workspace configurations would have on their organisation culture, staff morale and sense of belonging.

As for manpower, the MOF said it expects to see an increased demand for resourcing and public sector manpower as Singapore learns to live with Covid-19 and moves to address its medium-term priorities.

Therefore, the ministry has informed the committee that its baseline spending is likely to increase as a result of the pandemic and various other structural trends.

That being said, the MOF will ensure that the public-sector workforce grows at a sustainable rate, in line with the resident labour force growth, and that it does not take up an outsized share of the resident labour force at the expense of the private sector.

The ministry is reviewing the overall size of the public sector to ensure that it is able to meet future needs.

The report also mentions that the MOF is mindful of the need to bridge the digital divide in its push towards digital services due to the pandemic.

And as more in the public sector adopt hybrid or work-from-home arrangements, the government is also working to introduce appropriate controls to manage risk in areas such as cyber and information security.