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Singapore Budget 2018: Overall budget surplus of S$9.6b for FY17; budget deficit of S$0.6b expected for FY18
BOOSTED by exceptional contributions from statutory boards as well as increased stamp duty collections, Singapore is expected to rack up an overall budget surplus of S$9.6 billion for FY2017, markedly higher than the S$1.9 billion forecasted a year ago.
Contributions from statutory boards clocked S$4.9 billion - thanks largely to the Monetary Authority of Singapore - as opposed to the S$0.3 billion that was expected. In addition, the swell in property transactions allowed for the stamp duty collections to rise to S$4.7 billion, higher than the S$2.7 billion anticipated.
At S$9.6 billion, the budget surplus equates to 2.1 per cent of gross domestic product (GDP). The budget surplus for FY2016 was S$6.12 billion.
In his Budget Speech on Monday, Finance Minister Heng Swee Keat warned that such contributions from the statutory boards and higher stamp duty collections are not expected every year.
"We cannot base our long-term fiscal planning on the basis of exceptional factors being positive, year after year," he highlighted. As a result, a significant portion of the surplus is being set aside for future spending. The government will channel aside S$5 billion towards a Rail Infrastructure Fund, as well as another S$2 billion to subsidise premiums and other forms of healthcare support for Singaporeans.
Singaporeans will, however, receive a one-off SG Bonus, thanks to the bumper surplus. All Singaporeans aged 21 and above this year will receive S$100 to S$300, depending on their income. This will cost the government S$700 million in total.
Total operating revenue for FY2017 (revised) will reach S$75.15 billion, up 8.2 per cent from the estimated S$69.45 billion. Expenditure will total S$73.92 billion, lower than the S$75.07 billion anticipated, as there was lower-than-estimated expenditure in certain sectors, namely housing, transport, education and healthcare.
Special transfers (excluding top-ups to endowment and trust funds) will come to S$2.22 billion, slightly lower than the S$2.57 billion estimated, while top-ups to endowment and trust funds will be, as expected, at S$4.01 billion. Net investment returns contribution (NIRC) is expected to come to S$14.61 billion, up from the S$14.11 billion estimated.
Mr Heng said: "Notwithstanding the overall budget surplus, FY2017 budget remains expansionary for the domestic economy."
Excluding the government's top-ups to endowment and trust funds and NIRC, this would work out to a basic deficit of S$1 billion, or 0.2 per cent of GDP.
For FY2018, the budget will also remain expansionary. On the whole, an overall budget deficit of S$0.6 billion, or 0.1 per cent of GDP, is expected. Ministries' total expenditures are expected to rise 8.3 per cent to S$80 billion in FY2018.
For more Budget 2018 stories visit bt.sg/budget18