Heng Swee Keat
Singapore
“In a world heading towards greater contest and fragmentation, amid rapid advances in science, technology and innovation, Singaporeans can play a valuable part as bridge-builders and connectors, and Singapore can be a trusted and neutral Global-Asia node of technology, innovation and enterprise.”
“The National Quantum Office has identified specific goals under the National Quantum Strategy (NQS), with resources and efforts directed towards specific quantum areas and technologies accordingly.”
“Mr Speaker, Sir, I would like to thank Member Ms Denise Phua for her comments because her comments reminded me of the tagline that I always said when I was in MOE – that you can learn from anyone, anytime, anywhere. In fact, peer learning is a very important aspect of that learning.”
“But I have laid out the strong basis for my optimism that a small and open economy like Singapore can continue to thrive and secure our next bound of growth. By serving as a trusted node and connector, we can create value by facilitating connections and building new linkages in today's fractured global landscape.”
“Secondly, one other very important thing the Member must bear in mind is that AI is a very rapidly developing field and it is something which our researchers are working hard on, to look at the different techniques of AI – it is not just GenAI, but the whole range of different AI systems that are being used – and how that can be used in c…”
“Assoc Prof Jamus Lim, you do not need an invitation. You are free to provide your suggestion. After all, are you not from WP? And by the way, let me make it clear that I have heard MPs on both aisles speaking about workers, and we have a very strong presence of our union MPs here and they will be speaking even more on this.”
The complete record
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“Mr Gan Thiam Poh suggested exempting vehicles and machinery from diesel tax if there are currently no non-diesel alternatives. But this works against what we are trying to do. The increase in diesel tax will help nudge businesses which are heavy diesel users towards greater efficiency. For example, companies can consider adopting consolidated logistics and use better routing applications to optimise their deliveries. In the interim, we have provided a transitionary offset package to cushion the cost impact till 2022, as businesses adapt to reduce their diesel consumption. Mr Ang Hin Kee, Er Dr Lee Bee Wah, spoke about the impact of diesel duty on taxi drivers. We recognise the cost impact faced by taxi drivers. As Senior Parliamentary Secretary Baey Yam Keng said, all taxi companies have pledged to step forward to pass the entire savings from the Special Tax reductions to their drivers. There are also incentives being offered to encourage taxi drivers to switch to petrol hybrid taxis, as we strive for lower emissions. This year, I had several good conversations with people about this Budget at various forums. Some asked me, "What about me? There did not seem to be anything in this Budget for me". Even if there is nothing new for you this year, you and your family have certainly benefited from every one of our Budgets. As I said, we must not look at the Budget in isolation. One Budget builds on another. So, let me outline how this Budget benefits different groups. Our young people have benefited from stronger support in education, housing and parenthood. They also benefit from the opportunities that a vibrant economy brings, as I explained earlier.”
“In last year's Budget, I introduced a new tier for the Buyer's Stamp Duty for value of properties in excess of a million dollars. We will continue to monitor developments in this space. At this point, let me address the concerns arising from the increase in diesel tax. Mr Dennis Tan acknowledged that the increase in diesel tax makes our environment more resilient, but asked if this is worth the price of potentially higher business costs. We must go beyond framing this as a simple tradeoff, to a broader understanding of the longer-term approach we are taking to address the increasingly urgent issue of vehicular emissions. Diesel exhaust contains substantial amounts of particulate matter and nitrogen oxides which are associated with an increased risk of lung cancer and respiratory infection. The long-term impact of excessive diesel use on the health of our family and children is significant. It is thus necessary to use a price signal to nudge diesel users towards cleaner and more sustainable alternatives. Diesel tax is only one part of a larger roadmap to discourage diesel consumption. In 2013, we introduced the Early Turnover Scheme (ETS) which has helped more than 40,000 commercial goods vehicles switch to cleaner and more fuel-efficient diesel vehicles. In 2018, we introduced the Vehicular Emissions Scheme (VES) to further incentivise the purchase of cleaner vehicles and discourage the purchase of pollutive vehicles. It is encouraging to note that there were no new diesel taxis registered in 2018. The number of diesel taxis has also decreased by more than 30% from 23,700 in 2016 to 15,100 in 2018, as taxi companies switch to electric and electric-hybrid taxis.”
“Mr Yee Chia Hsing spoke about whether car ownership can be taken into account when means-testing, while Ms Jessica Tan and Mr Lim Biow Chuan asked if the Annual Value (AV) criterion can be removed. No criterion is perfect, but if we put all our different schemes together, we have a system that is progressive and, as Mr Yee Chia Hsing said, fair. If we use vehicle ownership, for example, should we distinguish among the make and model, and what the vehicle is used for? The Government will continue to regularly review the eligibility criteria to ensure our schemes benefit the intended groups, whilst being practical to implement. For those who have specific needs, the best approach is to appeal to the relevant authorities which will consider each appeal based on its own merits. Miss Cheryl Chan has argued for a number of other measures to address growing wealth inequality, such as the introduction of a net-wealth tax, or an inheritance tax. I spoke briefly about this during the Budget Debates last year. There are many types of wealth taxes. What works best depends on the country’s overall tax system and broader economic and social circumstances. Our approach has been to tax fixed assets which, as the name suggests, are fixed and less mobile. Indeed, a large portion of total Singapore household wealth is held in the form of housing assets. We have two types of taxes on property, that is, Stamp Duty and Property Tax. We have been making them more progressive over the years. Owner-occupied properties enjoy a concessionary property tax rate, with the rate being higher for higher-end homes. The property tax rates are also higher for non-owner-occupied residential properties, such as those left vacant or rented out.”
“The Ministry of National Development (MND) will share more details on their greening efforts at the COS. As we calibrate our fiscal tools, the ultimate goal is three-fold, that is, to remain pro-growth; ensure that our overall system of taxes and transfers remain fair and equitable; and keep the tax burden on the middle-income low. There have been calls for the Government to do more in redistribution through the tax system, to address income and wealth inequality. Mr Saktiandi Supaat suggested if we could tier GST for different goods to lower the tax burden on the lower-income. This has been raised multiple times in Budget Debates over the years. But let me briefly reiterate the key arguments why a multi-rate GST is a less efficient way to help the lower-income. First, it is difficult to define a "necessity". Take bread, for example. There are the white, and wholemeal loaves that you can find at supermarkets, but there are also loaves sold at artisan bakeries. On top of that, there are so many other types of bread – floss buns, baguettes, kaya toast at your coffee shop. Where do we draw the line? Second, better-off households tend to spend more in absolute terms and thus benefit more from these reduced GST rates. Finally, the experience of many countries and relevant studies also show that a multi-rate GST system raises businesses' compliance and administrative costs significantly, which are then passed on to consumers. Our approach is to have a flat GST rate, while providing structural offsets through the GST Voucher scheme. This is a permanent scheme to provide more help to lower-income households and seniors. It is also more targeted, as those who need help most get it most directly. This is in addition to other schemes and programmes to help the less well-off.”
“It merely converts a concentrated lump of spending in a few years into a smoother stream of loan repayment with interest. And we must have every intention to pay back what we borrow. In fact, it is irresponsible for a government to borrow to spend on recurrent needs, such as healthcare and security. Such borrowing shifts the burden of paying for today’s needs onto future generations. This goes against the same principles of inter-generational equity that Mr Pritam Singh said he stands for. Mr Sitoh Yih Pin has rightfully cautioned against this and has called for further safeguards to prevent excessive borrowing. I share Mr Sitoh Yih Pin's views. If we proceed to use Government debt, we will make sure it is done in a disciplined and prudent manner. Safeguards will be put in place to ensure that the debt, its interest and repayment are sustainable and in line with the Reserves Protection Framework. Borrowing or not, it does not change the fact that all Government projects should be cost-efficient, well-managed and must yield economic or social benefits. What do we have to show in 10, 20 years’ time? An important question raised by Ms Tin Pei Ling. Borrowing is a financing tool. If used sustainably, it allows us to build a better living environment for our people and to make Singapore a dynamic and liveable city. This is not just a question about growth, but also one of sustainability, as emphasised by Dr Teo Ho Pin. Mr Pritam Singh asked if building Singapore will come at the expense of our green spaces. The Member should not take the word "building" so literally, not just in bricks and mortars. We have always incorporated greenery in our urban plans. It is not only part of our climate change resilience efforts; it is part of Singapore’s identity as a City in a Garden.”
“Our Reserves, like our investments in defence and security, give us the confidence to plan long term, knowing that we will have the ability to take care of our people and to defend our sovereignty. Lastly, let me talk about borrowing. Over the next decade, we are making significant investments in our infrastructure to enhance connectivity and create new growth opportunities for tomorrow. As I mentioned in the Budget Statement, the Government is studying the option of borrowing carefully as a tool to finance major, long-term infrastructure, and will announce our plans in due course. In my round-up speech last year, I mentioned a number of infrastructure projects which our Statutory Boards and Government-owned companies are looking to borrow to finance. This included the Integrated Waste Management Facility by the National Environment Agency (NEA), and the Johor Bahru-Singapore Rapid Transit System Link by the Land Transport Authority (LTA). In this year’s Budget speech, I mentioned our long-term infrastructure needs. And as Ms Tin Pei Ling has noted, we also have to plan ahead for our ageing infrastructure. All these are long-term needs that have to be studied carefully. When ready, we will share more. As these projects have lumpy upfront costs and benefits that span many generations, borrowing can be a fair and efficient tool to finance and spread out these costs, instead of raising taxes sharply to fund them. In this regard, there is a simple answer to Mr Pritam Singh’s question about how borrowing will impact revenues available for future recurrent spending. Mr Pritam Singh asked how borrowing would impact revenues available for future recurrent spending. It does not. Borrowing does not create new revenues for recurrent spending.”
“Mr Pritam Singh referred to a Business Times article and asked for more data on our Reserves so that I quote, "Singaporeans can crunch the numbers themselves, and better understand Budget policy tradeoffs". He has also filed a cut on transparency on the Government of Singapore Investment Corporation's (GIC’s) performance, which will be answered at MOF's COS. But let me explain why the Member is misinformed. Our Reserves comprise assets invested by the Monetary Authority of Singapore (MAS), GIC and Temasek. The size of MAS and Temasek's assets is public information. Only the GIC portion is not disclosed, and that is because with the GIC figure, you get the complete picture of our Reserves. I was running the Monetary Authority of Singapore during the Global Financial Crisis, with Emeritus Senior Minister Goh Chok Tong as our Chairman. Let me tell you that in a crisis where the most powerful central banks in the world, and even some of the biggest financial institutions, were taken completely by surprise by the speed and scale of the turn in the markets and the global economy. Many things could have gone wrong. We not only rode through the crisis well but emerged stronger. Having our Reserves as a strategic asset played a key role in this. So, let us not squander this strategic advantage that we have. Our Reserves also serve as a strategic defence, to deter parties who wish to undermine the interests of Singapore and Singaporeans. Such moves go beyond currency speculation attacks, to other types of threats. As Mr Mohamed Irshad noted, we live in a volatile, uncertain, complex and ambiguous (VUCA) world.”
“In planning for FY2019, we were also faced with the global economic outlook being downgraded by the International Monetary Fund (IMF), as global trade tensions grew. More fundamentally, we should not have the mentality of trying to spend everything that we have before the end of each term of Government. As part of our long-term approach, we continue to review our plans for the long term and will deploy financial resources where necessary. On this note, let me briefly reiterate the role of our Reserves. Today, NIRC is already the largest single contributor of our revenues, larger than any category of the taxes we collect. If we did not have the NIR framework, we would have had to double our personal income tax collection or our GST collection to raise the same amount of revenues. In fact, we would not even be able to raise the same amount of revenue because it is now the largest category and doubling all the rest does not give you that same amount. Our Reserves are our strategic asset. We are a small country, exposed to global forces beyond our control. Our Reserves will allow us to tide over a crisis, without being reliant on others. We should not underestimate the need for a rainy-day fund. Singapore faces particular vulnerabilities, given our lack of natural resources. With an economy worth nearly $500 billion a year, we should set aside enough to protect it and our people’s livelihoods and future. So, let us stay disciplined. Today, we take up to 50% of the expected returns for spending, and plough back at least 50% to grow the principal and generate more returns. In this way, both the current and future generations benefit from the Reserves, and we can be confident of our future.”
“The Ministry of Finance (MOF) is constantly looking for ways to improve our forecasts. But the experience of other countries also shows that this is not easy to do. Japan’s revenue estimates, for example, had a margin of error of about 11% over the past five years. Hong Kong, a small open economy like ours, averaged slightly better, at 8%. Nonetheless, we will see how we can continue to improve. Mr Liang Eng Hwa also asked how the Government intends to use the accumulated surplus. First, let me clarify that any surpluses we have do not simply “disappear” at the end of the term. They become part of our Reserves which are invested to generate returns, part of which will form the Net Investment Returns Contribution (NIRC). As Mr Murali Pillai explained, when our economy grows, we have an obligation to contribute to the Reserves to be used for the uncertainties of the future. We should also bear in mind that the business cycle can turn, and having some surpluses on hand can allow us to provide targeted support to segments that need help to tide over the downturn. For a major crisis, we can turn to the past Reserves. During the Global Financial Crisis in 2008, our accumulated savings allowed us to fund $15.6 billion, or three-quarters of the $20.5 billion Resilience Package, with the remainder being funded from past Reserves. So, $15.6 billion, out of $20.5 billion, were from current Reserves. In 2017, to support the construction industry to tide over a period of cyclical weakness, the Government brought forward about $1.4 billion of public sector infrastructure projects to start in financial year (FY) 2017 and FY2018.”
“We will continue to monitor the prevailing economic conditions, trends in expenditure and the buoyancy of our revenues carefully. And as I said in the Budget speech, we have also been preparing a transitional package when this comes in. Next, related to the issue that Ms Foo Mee Har and other Members raised, I should also put into perspective the surpluses accumulated so far in this term of Government. Forecasting is an inherently difficult exercise. Some revenue items are volatile, especially those dependent on sentiment-driven markets, such as Stamp Duty or Vehicle Quota Premiums. For instance, in FY2018, we had estimated that Stamp Duty collections would be lower because of property market cooling measures. But the property market defied our expectations. There can also be surprises on the expenditure side. The two-year suspension of the Kuala Lumpur-Singapore High Speed Rail Project is a case in point. The unexpected surpluses over the last few years are not due to the introduction of Temasek into the Net Investment Returns (NIR) framework, as suggested by Mr Pritam Singh. The volatilities and uncertainties in revenues and expenditures, as I had just explained, account for most of this surplus. While the Government’s approach is to look ahead, plan ahead, and prepare for the unexpected, it seems that Mr Singh would prefer to look backwards to find unexpected revenue surprises, and count on them to keep happening. I am afraid such an approach of hoping for the best is not how we will secure Singapore's future. While there is room for improvement, the accuracy of our revenue and expenditure projections has been reasonable and respectable by international standards. Actual revenue and expenditure figures have generally been within +/- 4% of our original estimates.”
“1 billion in 2019 alone to subsidise patient bills through existing permanent schemes that all Singaporeans enjoy. This does not even include spending to enhance our healthcare facilities and to research more effective treatments. As our population ages, spending on permanent healthcare schemes and other parts of the healthcare system will continue to increase structurally. Funding this requires a structural increase in our operating revenues. In other words, the base of our healthcare spending is rising. Over and above this rising base, we have special packages set aside for our PG and MG. Every ageing society faces similar structural spending pressures. A recent OECD paper highlighted that in the median OECD country, public health expenditure is projected to increase by almost five percentage points of GDP between 2018 and 2060. Five percentage points. The OECD’s recommended approach is no different from ours. To address the growing fiscal burden from higher healthcare spending and demographic change without further ballooning of public debt, there is a need for these governments to raise primary revenues. The median OECD government is estimated to require additional revenues of 6.5 percentage points of GDP by 2060; 6.5 percentage point. What does 6.5 percentage points of GDP mean? To put it in perspective, we expect to raise about 0.7 percentage points of GDP with the planned 2 percentage point GST increase. So, you compare 6.5 percentage points to the 0.7 percentage point of GDP that we have, and you see the scale of the issues in many places. We have yet to decide on the exact timing of the GST increase and we will exercise care when doing so.”
“We had debated this at last year’s Budget, and I am glad that many Members agreed with this. Nevertheless, there have been some reservations raised over the approach and timing of our plans to raise taxes going forward. Ms Foo Mee Har urged the Government to postpone the Goods and Services Tax (GST) hike for as long as possible. She suggested that the funds that we have set aside this term for various future expenditures like the MGP and the use of borrowing for future infrastructure expenditures could provide sufficient fiscal space to postpone the GST increase. I appreciate Ms Foo’s suggestion to delay this. Let me assure her and Members of this House that the decision to raise GST was not made lightly. As the Government, it is our responsibility to anticipate and plan ahead for future needs. While doing so, we also need to distinguish between one-off factors and underlying structural increases. The GST increase is needed to support structural increases in healthcare spending, among other important needs, like preschool education and security. Such healthcare spending is of a completely different scale and nature from the cohort-based package set aside for MG or PG. As mentioned earlier, the Government has systematically laid the foundation of a broad-based healthcare system that supports not only seniors, but all Singaporeans, regardless of their age and income. They support not only seniors but all Singaporeans, regardless of their age and income. We now provide significant subsidies in all care settings of up to 80% in our public hospitals and for long-term care services, up to 70% for specialist outpatient services, and up to 75% for polyclinics. MOH expects to spend $6.”
“But no one – not you, not me, not the Government – has all the answers. Today, we consult, engage and partner relevant stakeholders when formulating policy. So, I am glad Assoc Prof Walter Theseira and Mr Ang Wei Neng have spoken on the importance of feedback for more inclusive policymaking for the better of our society. There is always room for improvement, and Mr Ang Wei Neng has given robust feedback, which our agencies will take seriously. But we must not stop at just making criticism, but reach out to one another, recognise that we may have different views, but we can work together and find the middle ground, find the right way. We will tackle our challenges and construct better solutions, together. And as Mr Christopher de Souza has just reminded us, our political dialogues must not degenerate into political brinkmanship, as we are seeing in many developed countries. I have spoken about the Singapore way – our way – with people at the heart of our policies, planning for the long term while adapting to near-term circumstances, and doing it together, working in partnership. Our Budget reflects these principles, not just in the way we spend, as I had explained, but also in the way we fund our spending. Many Members of Parliament in this House have called for more "M&Ms", not the sweet chocolate candy, but "more and more". I, too, like M&Ms, but our resources are finite, but our needs are growing and diverse. To square the circle, we need to use the right tools for the right needs, with these principles in mind. And we need all of these tools, to balance our Budget in the medium term. Let me talk about each of them in turn. First, taxes. As individuals, we can all accept that we should pay for what we use. Similarly, each generation should pay for their own needs.”
“To help them to continue deepening their capability, and increase the impact of the good work they do, for instance, we started the VWO-Charities Capability Fund (VCF) in 2002 to help VWOs train their staff, expand their reach and serve people better. In 2017, we set aside $100 million for the fourth tranche of VCF. The 250% tax deduction that we offer today on qualifying donations is also one of the most generous tax deduction schemes worldwide. Jurisdictions like Hong Kong, the US and Australia provide only 100% tax deductions for corporate and individual donations. Matching grant schemes like the new Bicentennial Community Fund which I announced will also catalyse more funding to our Institutions of Public Character (IPCs). Together with the 250% tax deduction, effectively, every dollar donated can draw a Government contribution of up to $3.50. The Minister for Culture, Community and Youth will elaborate on our efforts to support philanthropy and volunteerism at the COS. We will keep Singapore safe and secure together. That is another important part of our partnership. So, I am heartened that Members of Parliament, like Mr Henry Kwek, Mr Darryl David, Mr Dennis Tan, Mr Mohamed Irshad and Mr Vikram Nair appreciate the geopolitical situation that Singapore is in, and support our commitment to make sustained investments in our security and defence capabilities. We have good men and women in our security forces and diplomatic corps. But they cannot be everywhere, or protect every flank. Every Singaporean has a part to play through national movements like SGSecure. We must stay alert, stay united and stay strong against threats, be it terrorism or cyber warfare. Everyone must play a part in Total Defence. And we will find the best way forward together.”
“Mr Liang Eng Hwa asked if the customised approach of the Scale-up SG programme meant that the Government is picking winners. This is not the case. The customised support that we provide is available to companies that show ambition and are willing to take the effort to transform themselves to scale up quickly. This support comes on top of many schemes which are accessible to firms, small or micro, for example, schemes which help firms adopt digital technology solutions, such as Start Digital Pack under SMEs Go Digital. And where there are market gaps, we provide support, such as through the Enterprise Financing Scheme, to provide financing for younger and smaller firms. These schemes, together with a wide range of schemes under the Startup SG branding, provide a strong base of support for startups, which Ms Denise Phua asked about. As pointed out by Ms Rahayu Mahzam, many Singaporeans and businesses have demonstrated their care and concern for fellow Singaporeans through their good work over the years. TSMP Law Corporation is one such example. In addition to providing pro bono legal services for the disadvantaged, the firm also regularly partners VWOs to contribute time and dollars to a broad range of causes and activities. VWOs, like Ang Mo Kio Family Service Centre (AMK FSC), Society for the Physically Disabled (SPD) and Empower Ageing, have also done an excellent job in serving a broad range of needs in the community. And as Ms Denise Phua said, their reach extends beyond what the Government can do. So, I thank them for their efforts, their hard work, and more importantly, heart work, in reaching out.”
“As an outcome from this exchange, Imagine H2O has assessed Singapore to be a strategic location to set up its presence for the Asian market, and it is in the midst of establishing a presence here. I was glad to hear Mr Douglas Foo's affirmation that the TACs remain committed to enhancing the business community’s capabilities and collaborating with member firms, the Government and the Labour Movement. And I support his call for, I quote, "TACs to further break down individual walls, and work with one another to accelerate our common national interests". The enhancements to the Local Enterprise and Association Development (LEAD) programme which I announced in this Budget will further strengthen the role that TACs play. We invest in building an environment to help firms with the capabilities thrive, through steady investments in R&D, and strengthening economic linkages to the region. This builds on our comparative advantages to help us, as an economy, to excel. To do so in a way which works for each sector, we bring relevant stakeholders together to drive transformation through Industry Transformation Maps (ITMs) and ITM cluster strategies. We also take an enterprise-centric approach, which focuses on issues faced by firms at each stage of growth. This tailored and targeted approach allows our economic schemes to yield better results. For firms which are ready to scale up and compete on a global scale, we provide more customised support. This is to help them identify and overcome the unique challenges they face, and scale their businesses quickly. I announced the Scale-up SG programme and the pilot Innovation Agents programme this Budget, which will help in this area.”
“Some of the crane operators I met had worked with PSA for over 20 years and commented that the changes led to better working conditions as they could work from a remote air-conditioned office, rather than in the crane cabin, high on top of the crane. Another example is ST Engineering's aerospace sector, which I visited earlier this week. To ride on the wave of Industry 4.0, ST Engineering has been investing in smart maintenance, repair and operations (MRO) initiatives at its hangars to adopt data analytics, additive manufacturing and automation. I was encouraged to hear that its union-management Training Council worked closely with NTUC Learning Hub to customise the SkillsFuture Digital Workplace course for the workers, to familiarise the workers with digital technologies, new work processes and automation. Over 200 staff attended the course in 2018, with another 600 staff expected to attend the course in 2019. So, I am glad to see ST Engineering building enterprise capabilities and deepening worker skillsets in tandem. This is the type of positive outcomes for workers, businesses and the Government, which we all strive to achieve. Our Trade Associations and Chambers (TACs), as representatives of firms, have an important role to play in this effort. So, I am glad to see more stepping up over the last few years. For example, through its networks with the global water community, the Singapore Water Association (SWA) introduced Imagine H2O, a leading water innovation accelerator in San Francisco, to local industry players. And this led to exchanges of ideas on commercialising innovative water technologies between our firms and Imagine H2O's startups. This Association is also working with Enterprise Singapore to immerse Imagine H2O into the local water ecosystem.”
“A skilled, committed workforce gives firms a competitive edge, and this is the smart thing to do. We will continue to provide support to firms which more directly link their companies' growth and transformation with capability building for their workers, such as in changes we made to EDG and PSG. I am glad to hear about the Singapore National Employers Federation's (SNEF's) efforts to help employers implement responsible employment practices as a means to enhance competitiveness and sustain business growth. I was pleased to hear NTUC's Secretary-General Ng Chee Meng and Senior Minister of State Koh Poh Koon talk about the NTUC's plans, such as the setting up of training committees and partnering companies to build worker capabilities. Our unions are not just into advocacy. Our unions take concrete and meaningful action which makes a difference to our firms and workers. And we will continue to support our unions in this effort. One example of how the tripartite partnership can lead to positive outcomes is PSA. When I visited PSA earlier this month on the first day of Chinese New Year together with Senior Minister of State Koh Poh Koon, I was glad to see them adopting new technologies, such as the automated crane system. PSA has reskilled and upskilled over 1,300 workers who transitioned from city terminals, to use the new technology at the Pasir Panjang Terminals over the past few years. PSA has worked closely with the Singapore Port Workers Union and Port Officers' Union in engaging and facilitating the change for the large pool of staff involved in this transition.”
“As Prof Fatimah Lateef put it, "Partnerships to Prosper" involves partnerships at all levels – globally, regionally and in Singapore – in our businesses and in the community. Partnerships are also important for the arts community, as Mr Terence Ho shared. We seek to be friends to all and build strong international partnerships for mutually beneficial outcomes and we have been steadily strengthening our partnerships. Free Trade Agreements allow our businessmen access to other markets, and this is particularly important in this period where there are significant trade tensions. Defence agreements allow militaries to build mutual understanding. Collaborations between officials and businesses build goodwill and better people-to-people connections. Examples are Suzhou, Kendal, the Chongqing Connectivity Initiative, Iskandar Malaysia and the new state capital city of Andhra Pradesh. But of all the partnerships that we build, the most foundational ones are the partnerships within Singapore. A strong and united Singapore enables us, both Government and our people, to build strong partnerships elsewhere. A strong and united Singapore assures our partners around the world that we can be taken at our word and will not cycle back on our commitments due to domestic divisions. A strong and united Singapore also sends a clear signal of our will and resolve to defend our sovereignty and safeguard our vital interests. One key partnership within Singapore is our tripartite arrangement, which is a unique strength for Singapore. We must build on this and strengthen partnerships between the Government, firms and unions. Firms must build deeper capabilities together with their workers. The workers benefit from better jobs and better pay.”
“The Government will look at the needs of each group, and tailor our policies and programmes in the future. Senior Minister of State Chee Hong Tat has summarised this well. The MGP is not linked to the election cycle, nor is it linked to the unexpected surpluses this term. It is a plan that has been carefully studied over a significant period of time. Not many countries in the world had gone through a similarly compressed period of accelerated growth, leading to relatively wide divergences between the older and younger generations. Building on our substantial base of permanent healthcare schemes, a calibrated cohort-based approach is fair to different generations. If we continue to take a responsible and long-term approach to planning, younger Singaporeans need not fear that they will end up with a disproportionate share of the cost. But if we lose this discipline and make rash promises, like universal benefits regardless of circumstances, I would worry for our future generations. I have outlined two aspects of the Singapore way – putting people at the centre of what we do and planning long term. The third principle of the Singapore way that I would like to highlight is partnership. We have consistently been advocating this partnership for years. As Mr Murali Pillai pointed out, it is not just this Budget, but also past Budgets which had partnership as a key element. In Budget 2016, our theme was "Partnering for the Future". In 2017, it was "Moving Forward Together", and in 2018, it was "Together a Better Future". Previous Finance Ministers have had different ways of titling their Budget speeches, but partnership – working together – has always been key to our policies.”
“There have been questions, in and outside of this House, on whether we will or should have packages like the PGP or MGP for future generations. Some have even suggested names. Some asked in anticipation; others asked because they were worried about who pays. Policymaking in real life does not assume that we start with perfection. My earlier examples show that we do not let the perfect be the enemy of the good. We do what is good, learn by doing, and adapt and improve continually. During Singapore's journey from Third World to First, our MG, and our Pioneers especially, did not benefit from the social safety nets we have today and the investments we can now make. They had fewer or no educational opportunities. They earned less. The CPF contribution rates started out very much lower. So, a cohort-based approach to support them in their silver years is appropriate. You can say that we custom-made the packages to better meet their needs, and to honour them for what they have done for Singapore. For the younger cohorts, they, too, will have needs, but they are not of the same nature as the Pioneers or MGs. Today, more than nine in 10 Singaporean youths can expect to go on to a post-secondary education – nine in 10. This is compared to less than two in 10 among our youngest MGs, and about one in 10 for our Pioneers when they were at the same age. The schemes we have put in place over the years – MediSave, MediShield Life, CareShield Life – enjoyed over their full working lives, will make sure that, by the time they reach retirement, they will be in a much better position than the Pioneers or MGs to look after their own healthcare needs. Of course, some among us will still need more help.”
“Hence, we adjust and calibrate our approach as we go along, to take in feedback and learn from outcomes, to make our schemes more useful and effective for firms and workers. For example, a common feedback from SMEs was that it was difficult to navigate Government schemes and get support for business transformation. To help firms identify the support available to them, we launched one-stop portals like the Business Grants Portal and Startup SG. To reduce the number of schemes for firms to navigate, we rationalised grants that served similar objectives under the Productivity Solutions Grant (PSG), Enterprise Development Grant (EDG) and Partnerships for Capability Transformation (PACT) programme. This year, we will streamline eight financing schemes into a single Enterprise Financing Scheme (EFS). Our policies have been gradually adapted to help Singaporeans better prepare for retirement as we live longer. CPF LIFE, Silver Support and the Lease Buyback Scheme were introduced to boost the retirement savings of our seniors. MediShield Life, which started as MediShield, and CareShield Life, which will replace ElderShield for younger cohorts, will provide universal and lifetime coverage for healthcare needs. Later this year, we will expand the Community Health Assist Scheme (CHAS) subsidies to provide universal coverage for chronic illnesses. This last move, as Ms Rahayu Mahzam noted, shows the willingness of the Government to make changes when necessary. In fact, as Dr Lim Wee Kiak said, "we do have a universal healthcare system". As a pre-funding scheme, MediSave, too, has to evolve as medical technology advances, as more options become available, and as the population ages. We will remain flexible and adaptive to deliver the best outcomes for our people.”
“We have made the difficult but necessary move of cutting the Dependency Ratio Ceiling (DRC) levels for the services sector. Several Members, including Mr Chong Kee Hiong, gave feedback that some firms from the services sector find it difficult to automate their processes. But the reality, as Senior Minister of State Heng Chee How pointed out, is that our resident labour force growth will continue to slow. If we do not move decisively on improving productivity and building up a skilled Singaporean Core in industries which are currently lagging, firms will find it harder to adjust in the future. As Senior Minister of State Chee Hong Tat described it, the DRC cuts are like 苦口良药, bitter medicine that makes us better off in the long run. Even as we cut the DRC levels, we will help our firms in the transition, as Minister of State Zaqy Mohamad has outlined. As we take a long-term view in our planning, we must also consistently review our policies to take into account new trends, new feedback and new evidence. As Mr Christopher de Souza just mentioned, because of the rapidly changing world and our unique challenges, it is critical that we be able to draw from a broad slate of policies and avoid strict adherence to theories. We must be prepared to experiment and take calculated risks. If we do not succeed at first, we learn from our experience and try again. This is how we become better as a people and as a country. I encourage all Ministries to adopt this entrepreneurial mindset, and to continue to keep trying out different solutions for the issues that we face. We must be focused on exploring what works, discard what does not, and execute effectively, so as to achieve better outcomes for Singapore and Singaporeans.”
“However, the rapid growth of Asian economies will result in shifting comparative and competitive advantages in the region, which we will need to adapt to in order to benefit from this growth. Supply chains are shifting. This is driven by new technologies, the shift of global demand to emerging markets, and the consolidation of supply chains within manufacturing powerhouses in the region. At the same time, global value chains are becoming more knowledge-intensive, with research and development (R&D), software, design and other intangibles forming a greater share of value created. We are well-placed to ride on these changes. As a regional hub in many areas, such as finance, professional services and logistics, we are well-positioned as a base for businesses to capture the growing regional demand for such services. We also continue to have a strong manufacturing base, despite increasing competition from other economies. We must push ahead to strengthen Singapore’s position as a Global-Asia node of technology, innovation and enterprise. We will continue investing in research, innovation and enterprise development, and support our entrepreneurs and businesses to boldly venture into new markets. This will bring new opportunities to our people and firms. However, the window to achieve deeper economic restructuring, to help more of our firms capitalise on this opportunity, is narrow. We have achieved strong macroeconomic fundamentals through policies introduced over the years. What we need now is to double down on improving productivity and innovation at the industry and firm level, in particular, through a targeted, tailored approach to get firms of different types to adapt and transform.”
“As I mentioned earlier, the first committee on ageing was set up in 1982 when the proportion of Singaporeans aged 65 and above was only 5%. We are looking at various infrastructural plans to protect us from rising sea levels due to climate change, the effects of which are projected to hit us sometime between 2050 and 2100. Given the long-term horizon, it is difficult to project these spending needs now. Nonetheless, we are planning early, seeing what we can do, and will work out the resourcing accordingly. Our plans span many years, putting in place the right infrastructure, charting the course of our economy and steadily building up our capabilities. Given the long gestation of these projects, such as the airport and port projects, it is inevitable that they are subject to risks and uncertainties in the operating environment. So, I share Mr Dennis Tan's concerns on this issue. However, these uncertainties should not prevent us from making "exciting investments". Rather, they are impetus for bold but deliberate planning. Operating in challenging environments has always been our lot in life, which has taught us to plan carefully. Back in the 1980s, when we were building Changi Terminal 2, we also faced regional and economic uncertainties. But we persevered and overcame these challenges. We do not shy away from making difficult decisions if they are necessary for the long run. That is why we have been pushing hard on economic restructuring and have taken further steps this year to drive deeper restructuring. As Mr Darryl David and Ms Jessica Tan pointed out, there are significant shifts in the global economy, which means that we will be stuck if we stick to business as usual. We are fortunate to be in Asia where the growth is.”
“So, "Fried Rice Paradise" just got better with age! Our Pioneers were the first generation of Singaporeans who were living and working in Singapore after we became independent. Our MG is the next younger generation, better educated and healthier. So, we look to you to redefine ageing and forge a new path on what it means to be the independence generation. I have spoken on how we take care of our people. In essence, it is through building capacity in everyone – our young, working adults, seniors – to be the best that they can be, while giving those who need help even more support and help in a targeted way. Members of Parliament have also brought up other important issues. Ms Joan Pereira and Ms Anthea Ong spoke of the importance of support for those with mental health conditions. This will be taken up at the Ministry of Health's (MOH's) COS. Ms Joan Pereira, Assoc Prof Daniel Goh and Ms Rahayu Mahzam have also spoken on how to better support women, especially those who are caregivers. As Minister Josephine Teo shared, many of our existing schemes do benefit women more. In particular, the CPF top-up in this year’s Bicentennial Bonus will support women who did not work and, therefore, had low CPF savings for retirement. It is a fitting recognition of their contribution. We build capacity and adopt a long-term orientation in our planning. This is the second principle of the Singapore way. We plan for the long term, because we plan for Singapore to be here in the long term. We look ahead, often tapping on the knowledge of experts here and overseas, so that we can prepare for the future. Ageing, climate change and changing economic trends are just some of the issues that we have been preparing for.”
“Even better, the benefits would be there but not used or what she called "备而不用", meaning that it was best if she could stay healthy, and do not have to seek treatment in the first instance. I agree very much with her. The intention is for our seniors to focus on staying well. The MGP is there as an added assurance. So, I am glad to hear Ms Joan Pereira and Ms Irene Quay expressing support for this. I am always very happy to see groups of seniors coming together regularly in parks or other public spaces to exercise, like doing line dancing or Zumba Gold together. In fact, I understand that many of our seniors are exercising regularly in over 400 locations across the island. This is a good sign, and I hope there will be even more of such groups in the years to come. And last but not least, our seniors want to stay connected with one another and with those around them. I am encouraged by the progress made through the Community Networks for Seniors, which brings together Government agencies and community partners to help us have the "ABCs" where seniors stay active, befriend and care for one another. Some 1,500 seniors have come forward as volunteers to befriend and help other seniors. Take the example of Mr Bernard Lai, who is a member of our MG. Besides juggling his work commitments, he is an active grassroots leader, a member of various sports clubs and a Silver Generation Ambassador! At the MG tribute event hosted by the Prime Minister early this month, Dick Lee, Jacintha Abisheganaden, Mel Ferdinands and Rahimah Rahim – all MGs – gave a spirited rendition of Merdeka Sayang, I quote, "With our silver hair, we still contribute", and another quote "we work hard, but still young at heart". Indeed, these lyrics reflect the spirit with which we approach ageing.”
“Our $3 billion Action Plan for Successful Ageing was launched in 2016, taking in feedback from thousands of Singaporeans, both young and old, on what they saw successful ageing to be. Compare the title of this latest action plan with the title of the first committee on ageing we set up in 1982, namely, the Committee on the Problems of the Aged. Things have changed. And learning from the many seniors I have met who inspire me, let me share how they are redefining ageing, by staying active, healthy and connected. If we help all our seniors to make the transition, it will benefit them and also inspire all our younger generations. Our seniors want to stay active, be it through work, volunteering, learning something new, or keeping up with their grandchildren. And we want to support them in doing so. Opportunities to learn, grow and achieve do not stop at the retirement age. In fact, the National Silver Academy, which was part of the Action Plan for Successful Ageing, came about because our seniors told us that they wanted to keep learning and contributing to society. The Academy now provides a range of courses for senior learners, and supports inter-generational learning programmes. I am glad that we have support for this on both sides of the House. Assoc Prof Daniel Goh and Mr Faisal Manap have also made a strong pitch for our seniors to be active and continue to be the best they can be. Our seniors also want to stay healthy. Having the second highest healthy life expectancy in the world, we are in a good place. I recently met Ms Peng Lee Er, one of our MG, at a TV forum. She told me that she appreciated the MGP benefits as they provided assurance that her healthcare expenses would be taken care of.”
“We continually rejuvenate our estates and upgrade our flats, so that they remain vibrant and liveable homes for our people. These flats could also provide an additional source of income in retirement. At the same time, we provide other targeted support for those from less advantaged backgrounds, in different forms. Miss Cheryl Chan spoke about the need to uplift these groups. We have put in place schemes, such as KidSTART and the Fresh Start Housing Scheme, which help the lower-income get back on their feet. For those in their old age, Silver Support provides a supplement for those who had low incomes through life and little family support. ComCare is available for those with greater needs. There is always room to do even better, as many Members of Parliament have mentioned. But overall, it is a good system which gives Singaporeans a good foundation in life. That we still find the occasional cases which fall through the cracks does not behoove us to knock down the system. It gives us policymakers, public officers, social workers, community volunteers the motivation to do better, through action. Let me now turn to our seniors. Singapore is ageing quickly, quicker than many other developed countries. We made the transition from an ageing to an aged society in an exceptionally short span of 19 years. In comparison, Japan, the world's most aged country, took 26 years. Other countries like France took more than a century or 115 years, and Sweden took 85! Furthermore, by 2025, Singapore will become a super-aged country, with 21% of our citizen population aged 65 and older. But this should not be viewed in a negative light. Singaporeans can redefine ageing. We are already doing so.”
“At this point, I would like to explain the design of WIS and why we provide more support to older lower-income workers. Much as we wish to help those who earn less, how we do it is important. Permanently increasing their capacity to earn more is the most sustainable way to improving their lot in life and helping them support their family members. This is best done by upgrading their skills and improving their chances of getting better paying jobs. What they learn today will be useful for many years down the road, and build a foundation for further learning. In the meantime, we help them take care of their families' needs, such as bursaries for their children or MediFund for their parents' hospitalisation bills. Where there are challenges with accessing skills training, I am confident that NTUC and our unions can come in to support. Education and employment support are part of the comprehensive system of social support which benefit our less well-off. On the whole, our broad-based schemes are designed to provide them with more support. We help our workers save for retirement through the Central Provident Fund (CPF), which provides a risk-free return, with an extra 1% interest on the first $60,000 of CPF balances. Those who are aged 55 and above receive an additional 1% for the first $30,000 of balances. This structure tilts the benefits in support of members with lower balances. It is in the spirit of what Mr Saktiandi Supaat mentioned, of helping small savers grow their income. We also help Singaporeans own their homes, with more housing subsidies for the lower-income. There are few countries where young couples buy a home before they get married. In fact, in many cities, there is a huge gulf between those who can own properties and those who do not.”
“And I am glad that they recognise, in Mr Zainal Sapari and Mr Ang Hin Kee's words, that this year's Budget is pro-worker. The Labour Members of Parliament and Ms Sylvia Lim have spoken about various segments of our workforce – young workers, older workers, mid-career professionals, low-income workers, self-employed workers and those with caregiving responsibilities. The Ministry of Manpower (MOM) and MOE will address some of their suggestions in greater detail during the COS. A common thread in the comments, as Mr Arasu Duraisamy has noted, was how employers have a key role to play in helping their workers upgrade. Mr Melvin Yong commented that workers who go for training need to pull "double shifts" – training in the day and working at night. This is not easy to do. As workers put in the effort to train, I urge all employers to give them full support. I would also like to explain how we support our low-wage workers, in line with concerns raised by Dr Intan Mokhtar and others. Where possible, we want them to build capacity through upskilling, so that they can move up the wage ladder. This is why we give Workfare, not welfare. We have the Workfare Training Support scheme to encourage skills upgrading, and the Workfare Income Supplement (WIS), which I announced enhancements to this year. Through WIS and the Progressive Wage Model (PWM), we help lower-income workers upskill and reskill, earn more and save more. I am heartened to hear that Singaporeans, both within and outside the House, are concerned about whether families of lower-wage workers can make ends meet. Some, like Mr Mohamed Irshad, have suggested that the way to address this is to allow younger Singaporeans to be given WIS.”
“I was at the groundbreaking ceremony of Razer last week. I was excited that with Razer's expansion, we will be able to have many more opportunities for young Singaporeans, both here and overseas. We will continue to do more for our young. We have been investing more in preschool to make preschool education better, more accessible and affordable, especially for the lower-income. This will help our children build a solid foundation from an even younger age. Let me move on to how we build capacity in our workers to help them pursue their career goals. I agree with the National Trades Union Congress (NTUC) Secretary-General Ng Chee Meng and Mr Seah Kian Peng that for the Fourth Industrial Revolution, or Industry 4.0, to work for us, we need Worker 4.0 as well, meaning, we need our workers to transform and build capacity in tandem. As Mr Desmond Choo mentioned, learning and building capacity do not stop after formal education. Learning takes place anywhere, anytime, from anyone. The workplace is a good place for our workers to learn. As Mr Patrick Tay has mentioned, we provide support for our workers to reskill and upskill, to seize opportunities and do well for themselves. The SkillsFuture movement provides support for our workers to develop skills and pursue lifelong learning. For those who are displaced, we help them find a new job, and reskill where necessary, through programmes, such as Adapt and Grow. The Labour Movement plays a key role in this. I would like to thank the Labour Members of Parliament for all speaking on a common theme of "Every Worker Matters" and sharing their thoughtful views on what we should do to better support our workers. Senior Minister of State Heng Chee How spoke on putting workers at the heart of all we do.”
“Our schools provide this holistic education by making available co-curricular activities (CCAs), Applied Learning Programmes and Learning for Life Programmes, all of which are heavily funded by MOE. When I was an Education Minister, I visited many school systems around the world. And what struck me in many of the school systems was that, when I asked, "If your child or your student wants to learn Arts, Music, Dance, Sports, what do they do?" And in many of the school systems, the answer was, "Well, they have to join outside classes." And I asked, "How do you pay for it?" They said, "Well, we as parents pay for it." Whereas in our school system, CCAs to develop our students' interest and to develop them in diverse ways are part of the schools' system and funded by the Government. The Edusave Award for Achievement, Good Leadership and Service (EAGLES) and the Edusave Skills Award are just some of the ways we recognise students who demonstrate excellence for achievements, beyond academic. And you never know where the path will lead you. Take the example of Mr Wong Kah Chun whom the Prime Minister spoke about at the National Day Rally last year. He grew up in a Chinese-speaking family but, through his school band, discovered a love for Western classical music and is now the first Singaporean to conduct the New York Philharmonic Orchestra. We also support our young people to build their cross-cultural competencies. In this and the last two Budgets, I set out plans that will help our tertiary students, young workers and aspiring leaders to build friendships with peoples and understand our region better. These include the Global Innovation Alliance, the Leadership Development Initiative, and the Global Ready Talent Programme.”
“And beyond just making sure that everyone can afford education, we make sure that there is good quality for everyone, not just the top achievers or better off. In 2018, we provided at least 60% more resourcing for primary school students with a weaker foundation in literacy and numeracy through learning support programmes in schools. Our commitment to maximising pathways to success is clear. We have specialised schools catering to the needs of Normal (Technical) students, those with interests in science and technology, or the arts or sports. Most visitors to our country are very impressed with what we have done for our Institutes of Technical Education (ITEs), sometimes better designed and resourced than their universities. Several Members in this House and myself have been bringing visitors to ITE and they have been surprised to see what we have in the ITEs. The Ministry of Education (MOE) will elaborate more on our plans to Uplifting Pupils in Life and Inspiring Families Taskforce (UPLIFT) our students at the COS. What we do is not necessarily the case worldwide. In the United States (US), public funding per student varies widely across states and within states. For example, within the state of New York, one school district can get three times that of another school district, based on how well-off each school district is. I agree with what Prof Lim Sun Sun said about the need to help our students develop cross-cultural, digital and ethical (CDE) competencies. This is on top of the ABCs and 123s we teach them. Prof Fatimah Lateef also called on Singaporeans to develop strong networks to thrive in an age of change and disruption.”
“Many Members, including Mr Louis Ng, Ms Jessica Tan and Mr Gan Thiam Poh, have given suggestions on addressing class divisions, inequality and helping all Singaporeans do well, including the less privileged. The question is, how best to do so? As Mr Saktiandi Supaat put it, it cannot just be through a Robin Hood style of social transfers. We believe that the best way to take care of our people is to build capacity, that is: (a) For our young, we give them a strong foundation in terms of a good education and exposure, so that they have the knowledge, skills and values necessary to chase their dreams. (b) For our workers, we invest in increasing their capacity through upgrading and reskilling. Crucially, we also build an economy that provides them with opportunities. (c) For those who have fallen behind and who need help to access opportunities, we provide stronger support systems. This is with the ultimate objective to give them the confidence and dignity to succeed for themselves as far as possible. (d) For our seniors, we support them in their desire to age successfully. We have been providing significant support and will continue to do so. Let me illustrate. Our young get a high-quality education which provides a solid grounding to chase their dreams. We make sure this is available to all our people, regardless of background. We keep education affordable. Parents pay $13 each month per child for primary school fees. This is possible due to the significant subsidies provided to every child. On average, every child entering Primary 1 in 2018 would have received over $130,000 in education subsidies by the time he or she completes secondary school. Those who go on to post-secondary education receive another $15,000 to $22,000 for every year they remain in school.”
“Sir, in rounding up the Debate today, I can value-add by picking up some of the common threads in the Members' speeches, and to reinforce some of the key principles for this Budget and those before, which make up the "Singapore way". So, what is the Singapore way? First, we put people at the centre of our plans, strategies and programmes. Second, we plan long term while taking an adaptive approach to respond to changing circumstances and needs. Third, we do all of this together, working in partnership. These principles reinforce one another and have allowed us to do more with less. For instance, in the area of education – I showed this slide at last year's debate – we did not spend the most, but you look at the outcome that our students achieved in this Programme for International Student Assessment (PISA) score. On healthcare, again, we did not spend the most, but we have the second highest life expectancy, next to Japan. And Members can see the Organisation for Economic Cooperation and Development (OECD) countries’ averages on the right-hand side. For policing, good outcomes in policing where, again, with the spending that we have of just slightly above 0.6% of GDP, we are ranked one of the safest in the world. So, these are all very credible outcomes despite spending less than what other countries do. I will now elaborate on each of these principles. The first principle of the Singapore way is putting Singaporeans at the centre of what we do. We empower people through education, create a good environment for families, help Singaporeans to earn and save more for retirement and support ageing with assurance. As Er Dr Lee Bee Wah put it so eloquently, all that we do "完全是为了你", that is, "It is all for you".”
“Mr Speaker, Sir, I thank Members of this House for the views shared during the Budget Debate. Over the last two weeks, I have also noted thoughtful views from fellow Singaporeans, academics, journalists and business owners. I am grateful for this feedback. Some challenge our current thinking, while others help us refine our policies over time. We all have the same objective. It is to help Singaporeans thrive and build a strong, united Singapore. As we celebrate the Bicentennial, let us take a step back to reflect on how we got here today and how we would like to move forward. Some Members have provided good and useful overviews of the Budget and how they benefit various parties, such as Mr Liang Eng Hwa. Some have delivered vivid speeches during the Budget Debate, such as the one about Ah Kong and Ah Seng. My speech will not be as poetic as Senior Parliamentary Secretary Baey Yam Keng's. Listening to over 12 hours of your speeches in the last two days and this morning, I realise that it is not possible for me to address each of the points you have raised. My colleagues will engage you in the specifics of policies within their Ministry's purview. And as Members can see, I, too, have two files like on Budget Day. So, this will be a long speech. So, Mr Speaker, Sir, with your permission, may I use some slides so that it is easier for the Chamber to follow my speech, please?”
“Our institution of the Elected President, and the Council of Presidential Advisors, ensure that the Government of the day does not squander the reserves our forefathers have left for us. The Government will ensure that we abide by this. We must not only take care of this generation, but our children and their children. It is a core value we must uphold. Budget 2019 lays out this Government’s approach to build a strong, united Singapore. We nurture our young, take care of our seniors, expand opportunities for our people to be at their best, and to live in a liveable, endearing home, secure and globally connected. Together, in close partnership with all, in our public, people, and private sectors, we can, and will, continue to take Singapore forward. Mr Speaker, Sir, I beg to move.”
“Our people have shown time and again that we can take the long view, adapt with the times, and thrive. Third, we draw strength from our diversity by focusing on what we have in common. In the earlier years, our forefathers clustered around ethnic and religious groups to support one another. Today, Singaporeans support one another, regardless of race, language, or religion. Budget 2019 draws on these key lessons. We build on our multicultural heritage, to foster a caring and inclusive society. We continue to nurture our young and develop our people on a lifelong basis. We seek to take better care of our seniors so that they can stay active and healthy. We will partner businesses and workers to transform our economy. We welcome the best MNCs and SMEs from around the world, and help our start-ups and SMEs to grow, scale, and internationalise. We will help our workers deepen their capabilities and seek new opportunities. To catch the wave of the Fourth Industrial Revolution, we are positioning Singapore as a Global-Asia node of technology, innovation and enterprise. The changes ahead will be faster and deeper. Budget 2019 highlights the key challenges we are facing and how we are preparing to ride on the changes, to turn challenges into opportunities, for Singaporeans and for our partners in the global community. We are investing to keep Singapore safe and secure. We are restructuring our economy to enable our businesses and workers to thrive. We are building a more caring and inclusive society, and we are building Singapore as a global city and a home for all. Even as we invest more, Budget 2019 maintains our fiscal discipline.”
“0 billion, or 1.4% of GDP. FY2018 was hence an expansionary budget. For FY2019, our Budget position remains expansionary, with a basic deficit of $7.1 billion. Ministries’ total expenditures are expected to be $80.3 billion, 1.6% higher than in FY2018. We are setting aside funds to meet Singaporeans' long-term needs, including $6.1 billion for the Merdeka Generation Package and $5.1 billion for long-term care support. On the whole, we expect an overall Budget deficit of $3.5 billion, or 0.7% of GDP. [Please refer to Annex F.] We have sufficient fiscal surplus accumulated over this term of Government to fund the overall deficit in FY2019. There is no draw on past reserves. Mr Speaker, Sir, I will now conclude. First, I would like to thank the many Singaporeans, as well as businesses, unions, charities, and community organisations, who have provided your feedback and ideas. Also, special thanks to the talented students from Nanyang Polytechnic for the beautiful sketches that you see in my slides today. We commemorate 2019, our bicentennial year, to learn from our past in order to chart our future. We will have many opportunities to reflect and share in the coming months and years, but three lessons stand out for me and my colleagues. First, for as long as we stay relevant and useful, Singapore and Singaporeans will have our place in the world. We must develop deep capabilities, stay open and connected, and draw ideas and talents from around the globe. Singaporean talents have been making their mark in various fields, and connecting with other highly skilled individuals from around the world will make our team even stronger. Second, external events around us will shape and reshape our lives.”
“Notwithstanding the need to raise revenues in the future, at the core of our fiscal system is our commitment to keep the overall tax burden low. We want workers and firms to keep as much as possible of what they earn. This leaves our citizens free to choose how they spend, save, or invest. Our main indirect tax, the GST, is not high by international standards, even after the planned increase to 9%. The OECD average is 19%. Among the Asia Pacific countries, many have standard GST rates that exceed 9%. Ultimately, a competitive tax regime helps us to attract and retain investments and talent. These in turn help to bring in good jobs for Singaporeans. A competitive tax regime is a key anchor to our economic growth, and the best way to sustainably increase tax revenues. I will extend and strengthen tax incentives to enhance our business competitiveness. [Please refer to Annex E.] At the same time, I will make some adjustments to further enhance the progressivity and resilience of our tax system. The details of these changes are in the Annex. [Please refer to Annex E.] The Government will continue to plan ahead for the long term. My commitment to Singaporeans is that our overall taxes and transfers system will always remain fair, progressive, and pro-growth. Let me now summarise our overall budget position. For FY2018, we expect an overall budget surplus of $2.1 billion, or 0.4% of GDP. This is a $2.7 billion increase from the $0.6 billion deficit forecasted a year ago. This was due to the unexpected two-year suspension of the Kuala Lumpur-Singapore High-Speed Rail Project and higher-than-expected Stamp Duty collections. When we exclude the Government’s top-ups to funds and Net Investment Returns Contribution (NIRC) from past Reserves, we expect a basic deficit of $7.”
“We must not do this, as such borrowing shifts the burden of paying for today's needs onto future generations. That is not the Singapore way. A fairer and more robust approach is to meet recurrent spending with recurrent revenues. Hence, we must continually review our tax system to ensure its resilience. GST is a broad-based tax that contributes significantly to our fiscal resources. Last year, I announced the introduction of GST on imported services to make sure GST collections remain fair and resilient in a digital economy. This year, I will tighten the GST import relief for travellers, given rising international travel. For travellers who spend less than 48 hours outside Singapore, the value of goods bought overseas that can enjoy GST relief will be reduced from $150 to $100. For travellers who spend 48 hours or more outside Singapore, the relief quantum will be reduced from $600 to $500. This will take effect from tomorrow. [Please refer to Annex E.] I will also tighten the alcohol duty-free concession for travellers from three litres to two litres. This will take effect from 1 April 2019. [Please refer to Annex E.] As I had announced at the previous Budget, we will raise GST by two percentage points sometime in the period from 2021 to 2025. When we raise GST, we will ensure that our overall system of taxes and transfers remains progressive and fair. We will continue to absorb GST on publicly-subsidised education and healthcare. We will provide more help to lower-income households and the elderly by enhancing the permanent GST Voucher scheme. We will also cushion the impact of the GST increase for a period through a GST offset package. Lower- and middle-income households will get more. More details will be announced later.”
“Others, such as infrastructure to protect us against climate change, are contingent on the future state of the world. It is challenging to predict their exact timing and requirements. For these large and lumpy expenditures where the benefits span many generations of Singaporeans, paying for them through some borrowing is fairer and more efficient. Borrowing, done in a responsible and sustainable manner, will help instil financial discipline and distribute the share of funding more equitably across current and future generations. In the 1980s, the Government borrowed to build our first MRT lines. Our Statutory Boards and Government-owned companies have also continued to finance many major infrastructure projects through borrowings. For the development of Changi East, the Changi Airport Group will be taking up loans to fund its share of the infrastructure investments. To lower financing costs, the Government, with the President's concurrence, will provide a guarantee for Changi East borrowings. This allows us to tap on the strength of the Government's balance sheet to back this strategic investment. This lowers the cost of borrowing. The Government is further studying the option of using Government debt as part of the financing mix for long-term infrastructure projects that the Government will be taking on directly. Second, for recurrent spending needs in areas such as healthcare, preschool education and security, we must recognise that these are necessary expenditures – to take care of our elderly, give our children a good start in life, and keep Singapore safe and secure for our families. Many countries have taken the easier route by funding these recurrent expenditures through borrowing.”
“The National Research Foundation will continue to fund research and innovation in urban solutions and sustainability. Our public housing policies have also been uniquely successful because of our long-term planning. Today, we are not just building new flats. We are improving the quality of life for Singaporeans through the rejuvenation of our public housing estates. Our plans for the rejuvenation and renewal of our city includes the Home Improvement Programme (HIP), the Neighbourhood Renewal Programme (NRP) and the Remaking Our Heartland (ROH) initiative. For the longer term, we have announced HIP 2 and the Voluntary Early Redevelopment Scheme (VERS). These are plans that will keep our living environment first-class over the coming years. The Minister for National Development will be sharing more on these plans to build endearing homes for our people at the Committee of Supply (COS) debates. Singapore's ability to plan for the long term is our strategic advantage. But the best-laid plans to develop our people and transform our city can only be realised with a sound fiscal plan. Our fiscal discipline and prudence gave us the resources to respond decisively to unexpected challenges, such as the 2008 Global Financial Crisis. We must not take this for granted. While our nation's needs are growing significantly, we must continue to take a disciplined and prudent approach. We will pursue new investments using a differentiated fiscal strategy, taking one approach for major infrastructure investments, and another for recurrent social and security expenditures. First, infrastructure investments. Some of these are major, long-term projects, such as the development of Changi East and rail projects such as the Cross Island Line.”
“To help businesses adjust, I will provide a 100% road tax rebate for one year and partial road tax rebate for another two years, for commercial diesel vehicles. I will also provide, over three years, additional cash rebates of up to $3,200 for diesel buses ferrying school children. [Please refer to Annex E.] Building a more sustainable environment makes our quality of life better, and also creates economic opportunities. Just as we closed the water loop, we can now turn our attention to closing the waste loop. There are already start-ups tackling this challenge. Two companies, UglyGood and Tria, have been working on innovative ways to convert food-related waste into useful products. These are good examples of opportunities in our zero waste movement. So I hope to see more of such initiatives in the coming years. Our beautiful living environment can also be enhanced through the smart use of technology, as a part of our Smart Nation efforts. To reduce energy use, we have implemented district cooling in the Marina Bay area. To improve our quality of life, we have started rolling out pneumatic waste collection, and trialled smart urban mobility solutions. Buildings can also be designed to be environmentally friendly, for example, by being energy efficient and producing enough renewable energy to run itself. The Building and Construction Authority (BCA) was the first to retrofit its academy in 2009, making it the first retrofitted net-zero energy building in Southeast Asia. This year, NUS’s School of Design and Environment launched SDE4, a brand-new net-zero energy building. These initiatives contribute towards making our environment more sustainable and pleasant.”
“The Minister for the Environment and Water Resources will provide more details at the COS. Given our dense urban environment, air quality and greenery are especially important. The National Parks Board (NParks) has done an excellent job in greening Singapore – our island has more than 40% green cover. This improves our living environment and our air quality. But diesel exhaust is highly pollutive and adversely affects our people's health and quality of life. Many cities in Europe have announced restrictions on diesel vehicle usage. We have taken steps to discourage diesel consumption. Over the years, we have implemented schemes to encourage early renewal of diesel commercial goods vehicles and to also account for the impact of vehicular emissions. We have seen positive results. More owners are shifting towards more environmentally-friendly engines such as electric hybrids. We are glad to see a drop in the numbers of new diesel cars and taxis registered. We also restructured diesel taxes in 2017 to shift away from an annual amount of tax towards a usage-based tax system. We permanently reduced the annual special tax on diesel cars and taxis, and re-introduced the volumetric diesel duty. To continue the restructuring of diesel taxes, I will raise excise duty for diesel by 10 cents per litre, to 20 cents per litre. This takes immediate effect. At the same time, I will permanently reduce the annual Special Tax on diesel taxis by $850. I strongly urge taxi companies to pass on the savings to their drivers, like they did in 2017. This will on average reduce the impact of the duty increase by more than three-quarters for taxis. I will also permanently reduce the Special Tax on diesel cars by $100. This will, on average, reduce the impact by more than half.”
“Our Climate Action Plan, which was launched in 2016, sets out the strategy for mitigating and adapting to the impacts of climate change, especially on our infrastructure. In line with the Action Plan, low-lying roads near coastal areas have been raised. Changi Airport Terminal 5 will also be built at 5.5 metres above mean sea level. The use of polders and dikes is already being piloted on Pulau Tekong. These will help us to learn how to deal with rising sea levels. To protect ourselves against climate change and rising sea levels, we will have to invest more. Together with existing infrastructure needs, our total bill for infrastructure will increase significantly. It is very difficult to project spending needs way into the future, but the different Ministries have done some preliminary estimates. We will continue to do our best to look forward, develop fiscal plans well in advance, and put in place the right approach to finance such long-lived major infrastructure. Each generation should contribute its fair share. Tackling climate change requires global cooperation. Singapore is committed to doing our part. It is the responsible thing to do for our children and future generations. The carbon tax will be applied on this year's emissions. This is an important signal to companies and households to reduce emissions and adopt energy-efficient practices. As individuals, we too must change our ways and work towards becoming a zero-waste nation, by adopting the three "R"s: reducing consumption, reusing, and recycling. The Zero Waste Masterplan will be launched in the second half of this year. Among other issues, it will look at better management of food waste, e-waste, and packaging waste including plastics.”
“The upcoming Urban Redevelopment Authority (URA) Master Plan 2019 will guide our urban development over a 10- to 15-year time frame. It ensures that our limited land can be optimised to meet the needs of current and future generations. The Minister for National Development will share more details at the COS. The long-term transformation of our city must start with our HDB estates, where most Singaporeans’ homes are. It is important that we keep our living environment first-class. Many cities have large tracts that slip into disrepair over time – we must avoid that. We must strive to make every town in Singapore green and liveable, by rejuvenating them systematically over time. As our home, and a global node, our city has to be well-connected within and with the world. Within Singapore, we now have about 230 kilometres of MRT lines. This will rise to about 360 kilometres in the 2030s when major MRT projects, such as the Cross Island Line are completed. To enhance our global connectivity, we are increasing the capacities of our airport and seaport. This will strengthen our role as a key node within Asia and to the world. Connecting to future growth, knowledge, and cultural centres in Asia and beyond will not only benefit Singaporeans, but also add to the connectivity and vibrancy in our region. Beyond the next decade, we must also plan for climate change. Climate change and rising sea levels threaten our very existence. As a low-lying island nation, there is nowhere to hide when sea levels rise. Other small island nations like the Maldives are already facing the risk of flooding, with severe implications The Government is studying the implications carefully and will come up with measures to prepare ourselves adequately.”
“These are all on top of the targeted benefits such as the GST Voucher. Together, we hope that these measures will provide greater peace of mind for our older workers now and later in their silver years. In addition to the special Bicentennial initiatives, we will provide another year of Service and Conservancy Charges (S&CC) Rebate to HDB households. Eligible Singaporean households will receive S&CC rebates of between 1.5 months and 3.5 months. This will cost $132 million and benefit about 930,000 households. [Please refer to Annex D-2.] Finally, I will top up the Public Transport Fund by $10 million to continue helping commuters in need with their transport expenses, such as through Public Transport Vouchers for lower-income families. The Government keeps a close watch on the cost of living. Over the years, we have done much to alleviate cost pressures – whether in healthcare, education, or day-to-day expenses. Good macroeconomic management has enabled us to keep inflation low, while the Singapore dollar has been strengthening over time. Many Singaporeans who go on overseas vacations would appreciate this. Over and above these favourable conditions, this Budget continues to provide significant support for Singaporeans, especially our seniors and lower-income households. Budget 2019 supports the Government’s long-term strategy to build a caring and inclusive society. This is our continued effort to improve the lives of our people and our future generations. Today, our shining little red dot can hold its own on the global stage. But as the Minister for National Development has said, "we are not done building Singapore". Infrastructure takes time to build, but once built, can serve us for a long time. We must take a long view for our development plans.”
“For parents with school-going children, we will provide additional support for their children's education. Each year, the Government contributes to the Edusave accounts of all Singaporean students at primary and secondary school levels. This helps to pay for school enrichment activities, to better develop students holistically. This year, we will provide a $150 top-up to their Edusave accounts. This is on top of the annual Edusave contributions that they already receive from the Government. In addition, Singaporeans aged 17 to 20 will receive up to $500 in their Post-Secondary Education Accounts (PSEA). This will go towards helping parents to save for their children’s tertiary education. We will also provide additional support for older Singaporeans, who are near retirement. I will provide a CPF top-up of up to $1,000 for eligible Singaporeans aged 50 to 64 years old in 2019, who have less than $60,000 of retirement savings in their CPF accounts. This will be credited into the Special Account for members aged 50 to 54, and the Retirement Account for members aged 55 to 64. About 300,000 Singaporeans will benefit from this CPF top-up. The majority of these recipients will be women. Many of them left the workforce early, and took up important roles as mothers, caregivers, or housewives. As a result, they had fewer years to build up their savings. This top-up is a way to recognise their contributions and to help them save more. In addition to the CPF top-up, Singaporeans in the age group of 50 to 64 who qualify for Workfare will also benefit from the WIS enhancements that I mentioned earlier. Most of those in the 60 to 64 age group will also receive the Merdeka Generation Package, while the rest will receive the five-year MediSave top-ups.”