By Janice Lim
08 March, 2019
SINGAPORE — While he is often jokingly referred to as the God of Fortune, Finance Minister Heng Swee Keat said on Friday (March 8) that the “hongbao” (red packets, or goodies) dished out in the Budget have to be squeezed from the Government’s coffers.
To those who have asked him why the hongbao in this year’s Budget was so small, Mr Heng has replied: “This God of Fortune is not fat. This God of Fortune is quite thin, so money no enough. Whatever ‘hongbao’ given were squeezed out.”
Features of Budget 2019 include the S$1.1 billion Bicentennial Bonusand the S$6.1 billion set aside for the Merdeka Generation Package.
As part of the Bicentennial Bonus, about 1.4 million lower-income Singaporeans will receive up to S$300 in GST Vouchers at the end of this year, and employees under the Workfare Income Supplement (WIS) scheme will receive an additional 10 per cent of their total Workfare payment for work done in 2018, among other things.
Mr Heng was responding to a question from the audience during a Budget forum organised by Chinese-language newspaper Lianhe Zaobao, on how the Government plans to increase its sources of revenue given the demographic challenges of an ageing population and low fertility rate.
His comments come after Nee Soon Member of Parliament Lee Bee Wah recently drew flak from netizens for a fictional story she told in Parliament during the Budget debate.
Ms Lee spoke about a person called Ah Seng who was not grateful to his grandfather for scrimping and saving for him.
The grandfather in the story is widely understood to be the Singapore Government which, based on her story, had to scrimp and save to accumulate surpluses before distributing them to citizens.
Mr Heng said that the city-state’s finances were managed “very well” during its early years of economic development, under leaders like founding Prime Minister Lee Kuan Yew and former Deputy Prime Minister Goh Keng Swee.
He said the biggest contributor to the nation’s reserves, the Net Investment Returns Contribution (NIRC) — the returns from investing the country’s reserves — came in at over S$16 billion for the 2018 financial year.
This is higher than the revenue collected from the various taxes such as the Corporate Income Tax, Personal Income Tax and Goods and Services Tax.
Doubling these taxes would not be enough to cover the required expenditures, Mr Heng said.
Another method of managing finances is to borrow to fund large-scale infrastructure projects,.
Changi Airport Group will borrow to fund the construction of the Changi East development, which includes the airport’s fifth terminal, and the Government will provide a guarantee to lower its cost of financing.
“Borrowing is not because the Government doesn’t have money to undertake infrastructure projects,” he said.
Instead, it’s a better way for the companies to get returns out of these projects.
During the forum, other panellists also expressed their thoughts on this year’s Budget.
Mr Teo Siong Seng, chairman of the Singapore Business Federation, and Mr Roland Ng, chairman of the Singapore Chinese Chamber of Commerce and Industry, said they did not have much to “complain” about the Budget except for the hike in diesel tax and the cut in foreign-worker quota for the services sector.
Mr Douglas Foo, another panellist who is the president of the Singapore Manufacturing Federation, said these measures, while painful, are “bitter medicine” that is needed.
SINGAPORE — While he is often jokingly referred to as the God of Fortune, Finance Minister Heng Swee Keat said on Friday (March 8) that the “hongbao” (red packets, or goodies) dished out in the Budget have to be squeezed from the Government’s coffers.
To those who have asked him why the hongbao in this year’s Budget was so small, Mr Heng has replied: “This God of Fortune is not fat. This God of Fortune is quite thin, so money no enough. Whatever ‘hongbao’ given were squeezed out.”
Features of Budget 2019 include the S$1.1 billion Bicentennial Bonusand the S$6.1 billion set aside for the Merdeka Generation Package.
As part of the Bicentennial Bonus, about 1.4 million lower-income Singaporeans will receive up to S$300 in GST Vouchers at the end of this year, and employees under the Workfare Income Supplement (WIS) scheme will receive an additional 10 per cent of their total Workfare payment for work done in 2018, among other things.
Mr Heng was responding to a question from the audience during a Budget forum organised by Chinese-language newspaper Lianhe Zaobao, on how the Government plans to increase its sources of revenue given the demographic challenges of an ageing population and low fertility rate.
His comments come after Nee Soon Member of Parliament Lee Bee Wah recently drew flak from netizens for a fictional story she told in Parliament during the Budget debate.
Ms Lee spoke about a person called Ah Seng who was not grateful to his grandfather for scrimping and saving for him.
The grandfather in the story is widely understood to be the Singapore Government which, based on her story, had to scrimp and save to accumulate surpluses before distributing them to citizens.
Mr Heng said that the city-state’s finances were managed “very well” during its early years of economic development, under leaders like founding Prime Minister Lee Kuan Yew and former Deputy Prime Minister Goh Keng Swee.
He said the biggest contributor to the nation’s reserves, the Net Investment Returns Contribution (NIRC) — the returns from investing the country’s reserves — came in at over S$16 billion for the 2018 financial year.
This is higher than the revenue collected from the various taxes such as the Corporate Income Tax, Personal Income Tax and Goods and Services Tax.
Doubling these taxes would not be enough to cover the required expenditures, Mr Heng said.
Another method of managing finances is to borrow to fund large-scale infrastructure projects,.
Changi Airport Group will borrow to fund the construction of the Changi East development, which includes the airport’s fifth terminal, and the Government will provide a guarantee to lower its cost of financing.
“Borrowing is not because the Government doesn’t have money to undertake infrastructure projects,” he said.
Instead, it’s a better way for the companies to get returns out of these projects.
During the forum, other panellists also expressed their thoughts on this year’s Budget.
Mr Teo Siong Seng, chairman of the Singapore Business Federation, and Mr Roland Ng, chairman of the Singapore Chinese Chamber of Commerce and Industry, said they did not have much to “complain” about the Budget except for the hike in diesel tax and the cut in foreign-worker quota for the services sector.
Mr Douglas Foo, another panellist who is the president of the Singapore Manufacturing Federation, said these measures, while painful, are “bitter medicine” that is needed.
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