Revised FY2020 deficit soars to record S$44.3b
Singapore
WITH Monday's round of support measures against the novel coronavirus outbreak, Singapore's overall budget deficit for FY2020 is on track to become the largest deficit since its independence.
The revised overall budget deficit is expected to be S$44.3 billion or 8.9 per cent of gross domestic product (GDP), more than four times the deficit of S$10.9 billion estimated in February. This follows two rounds of support measures announced on March 26 and Monday, with numerous support schemes and waivers to counter the outbreak's economic impact.
Excluding the government's top-ups to endowment and trust funds and net investment returns contribution (NIRC), the revised basic budget deficit will total S$45.6 billion. Previously, the deficit was estimated to be S$12.3 billion.
Total spending by the ministries is projected to clock S$89.8 billion in FY2020, compared to original estimates of S$83.6 billion. This translates to a year-on-year rise of about 14.9 per cent from revised FY2019 expenditure.
In total, special transfers will rise to S$43.6 billion in FY2020, up from S$22 billion projected in February's Budget. Excluding top-ups to endowment and trust funds, special transfers will rise to S$26.3 billion from the originally estimated S$4.7 billion.
Top-ups to endowment and trust funds are expected to remain unchanged at S$17.3 billion, as should NIRC of S$18.6 billion.
With revenue sources like foreign worker levies and property taxes being waived or reduced, operating revenue for FY2020 is now projected at S$70.4 billion, down from S$76 billion in original estimates. The new figure is a roughly 5.8 per cent decrease year-on-year from the revised estimate for FY2019.
The Unity Budget on Feb 18 earmarked S$6.4 billion to support the Singapore economy through the Covid-19 virus outbreak. It was followed by the Resilience Budget on March 26, which committed an additional S$48.4 billion.
With the latest Solidarity Budget of S$5.1 billion, Singapore is committing a total of S$59.9 billion, the equivalent of about 12 per cent of GDP.
Deputy Prime Minister Heng Swee Keat, who presented the Solidarity Budget in Parliament on Monday, said he has obtained the President's in-principle support to draw on an additional S$4 billion from the reserves.
"This is an unprecedented budget, for extraordinary times," said Mr Heng. "The situation remains highly fluid and uncertain. The government stands ready to provide further support, should it become necessary."
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