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Singapore Budget 2018: Working together for the collective good
BUDGET 2018 is aptly themed "Together, a better future".
Tax policy changes are what Singaporeans and Singapore businesses often focus on in each year's announcement. However, this year's theme brings us back to the core purpose of government fiscal budgets.
A budget funds government revenues and expenditures. Yet at the heart of it all, the allocation of scarce resources is only meaningful if it builds a stronger and more cohesive society that Singaporeans can be proud to call home.
A central theme of Budget 2018 is the government's continued focus on supporting Singaporeans, in particular those in need, as it positions Singapore for a new era of growth. It reflects the government's efforts to provide equal opportunities and deepen our social compact.
While it is inevitable that some form of inequality exists, it is important that we offer hope to the more vulnerable, to the young and old, that there will always be a place for them in Singapore's future.
For individual Singaporeans and families, Budget 2018 expands existing measures, consolidates initiatives and encourages partnerships. Programmes that have been successful, such as the Community Networks for Seniors, will be expanded nationwide by 2020 to provide more touchpoints for our elderly. Services with synergies under the Ministry of Health, such as the Agency for Integrated Care (AIC) and Pioneer Generation Office, will be centralised under AIC. By extending tax deductions on donations and staff volunteering, businesses and the wider community are rallied to reach out to worthy causes among us. For the young, the SkillsFuture Earn and Learn Programme (a work-learn programme) and regional Go South-east Asia Award offer valuable exposure.
So, has Budget 2018 done enough to address inequality in Singapore?
In our view, inequality is an evolving, complex area. It is not a one-dimensional problem that any one Budget can in itself 'solve'. Nevertheless, this year's Budget rightly seeks to facilitate access to opportunities, support deep transformation and scalability for all Singaporeans.
No matter how well planned, the key to Budget 2018's success will depend on the implementation of these programmes.
For instance, Minister Heng has announced a series of business measures to encourage innovation, deepen capabilities and strengthen partnerships. Programmes such as the Capability Transfer programme aim to bridge capability gaps in the local workforce while the SME Talent programme develops capabilities of the young through structured internships. If implemented well, these should have long-term trickle-down effects on better jobs and greater work mobility. These will help families and individuals cope with rising costs through better wages and support their aspirational goals to reduce inequality gaps.
We remain hopeful about the implementation plans that will be announced and deliberated on in the upcoming Committee of Supply debates.
In addition to careful implementation, effective communication is key to gain broad buy-in for these initiatives. Particularly for the middle-income and vulnerable, a concerted effort will be needed to provide necessary encouragement for Singaporeans to invest in their long-term future beyond immediate worries about livelihood. To reach the desired segment in an effective way, the government will thus need to continue stepping up its multi-pronged outreach efforts and find innovative ways to work with stakeholders in a sustained manner.
While the government has to play its part in creating the right ecosystem to encourage social mobility and aspirations, Singaporeans too have to play their role in taking charge of their future. With the initiatives announced in this year's Budget building on the multitude of existing programmes, it is up to Singaporeans to commit and embrace opportunities made available.
Budget 2018 measures such as the upgrading of the Work Trial to a Career Trial Scheme provide higher funding support for Singaporeans to try out new careers. Singaporeans looking to switch careers or seek better growth prospects should look out for more details to be announced at the Ministry of Manpower Committee of Supply debate and consider tapping such schemes to facilitate career transitions.
From a skills upgrading perspective, the Tech Skills Accelerator (TeSA) programme run by the Association of Small and Medium Enterprises is another chance to upskill. Having committed or placed over 27,000 training places since its launch in 2016, the expansion of TeSA into new industries such as manufacturing and professional services as well as the widening of its curriculum into emerging digital areas allow willing Singaporeans to enhance their skill sets in sought-after areas.
One of the key threads of this year's Budget is the leveraging of cross-sector partnerships, acknowledging strengths of trade associations or community partners closest to beneficiaries and build on synergies for a greater collective good.
The word "Together" in this year's theme emphasises the importance of collectiveness which permeates throughout Budget 2018. Togetherness requires a desire by both the government to create the right environment and also each association, business and citizen to play their part.
As Mr Heng said in his closing remarks, "Together, we can make a better future for all of us." It is for each of us to collectively build a Singapore for everyone. Only then can Singapore strengthen its social compact with its citizenry.
- The writers are Chris Woo, tax leader, and Lim Kexin, tax director, at PwC Singapore.
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