Budget 2021: $107 billion Budget strikes balance between current and future needs
DPM Heng unveils a budget to help sectors that are under stress while also looking to transform businesses and workers for the future
Against a backdrop of global uncertainty amplified by the pandemic, Deputy Prime Minister Heng Swee Keat yesterday delivered a Budget finely balanced between providing immediate help to sectors under stress and investing in Singapore's long-term future.
The $107 billion plan - the first full Budget in the Government's new term - includes an $11 billion Covid-19 Resilience Package.
This will help safeguard public health and support the workers and businesses that need help, with extra money going to the hardest-hit sectors, such as aviation and tourism.
The Jobs Support Scheme, which helped stave off retrenchments last year, will be extended until September, but in a more targeted and tapering way. This will cost $700 million.
Jobseekers also got a helping hand, with another $5.4 billion set aside for a fresh injection into the SGUnited Jobs and Skills Package.
This is on top of the $3 billion set aside last year and will support the hiring of 200,000 locals through the Jobs Growth Incentive and provide up to 35,000 traineeship and training opportunities this year.
In addition, Mr Heng pledged to allocate $24 billion over the next three years to enable Singapore's firms and workers to emerge stronger from the crisis.
The country's investments to equip its people to seize opportunities and help businesses innovate are what distinguish it from others, said Mr Heng, who is also Finance Minister.
"While last year's Budgets were tilted towards emergency support in a broad-based way, this year's Budget will focus on accelerating structural adaptions," he added in a speech that lasted just over two hours and underscored the need to make the country's businesses and workers future-ready.
Mr Heng announced that the salaries of nurses and other healthcare workers, who have been on the forefront of the fight against Covid-19, will be enhanced, with details to be disclosed later.
In a Facebook post last evening, Prime Minister Lee Hsien Loong said: "While grappling with the pandemic, we must not neglect the future.
"Hence, the Budget has many items that build our capabilities and competitiveness. When the sun shines again, we must be ready to seize the new opportunities."
All these measures mean that Singapore will see a Budget deficit of $11 billion, following last year's deficit of $64.9 billion.
Running a fiscal deficit to support targeted relief is warranted in the immediate term, given the unprecedented impact of Covid-19, Mr Heng said.
But Singapore's recurrent spending needs in areas such as healthcare will continue to rise, and the country must meet these needs in a "disciplined and sustainable way", he said, adding that beyond this crisis, "we must return to running balanced budgets".
Petrol duties have also been raised for the first time in six years, and take place with immediate effect, with road tax rebates in place to cushion the impact of this hike.
Singapore expects its revenues will be able to support projected expenditure from all proposed measures as the economy recovers.
But this assumes the global Covid-19 situation comes under control by next year, said Mr Heng. Otherwise, the Government will seek the President's consideration to again tap past reserves.
"We have carefully thought through the different scenarios. While we expect recovery in Singapore and globally, there is a wide cone of uncertainty," he added.
"Even if the economic and fiscal situation turns out to be worse than expected, we must still press on to invest in new areas, so as to ride on the structural changes, transform and emerge stronger as an economy, and as a people."