East Coast Plan unveiled

[jw5]

from straitstimes.com:

Budget debate: DPM Heng, Pritam spar on need for independent parliamentary budget office

SINGAPORE - The creation of an independent body to monitor the Government's expenditure was at the centre of a sustained exchange between Deputy Prime Minister Heng Swee Keat and Leader of the Opposition Pritam Singh in Parliament on Friday (Feb 26), during the debate on the national Budget.

The Workers' Party (WP) secretary-general had called for the creation of an independent parliamentary budget office to enhance scrutiny of government expenditure.

In his round-up speech, DPM Heng said there are already independent audits by the Auditor General's Office, as well as parliamentary scrutiny through the Estimates and Public Accounts Committees.


With the WP already represented on both these parliamentary bodies, Mr Heng said the creation of a new office would be "a wasteful duplication of these functions".

Mr Singh responded that a Parliament budget office is "not an unusual institution in many parliamentary democracies", and that it is not just to help the opposition, but also all MPs.

He recounted that when he was a member of the Estimates Committee some years back, a senior civil servant had remarked then that she could not be smarter than her boss, the Finance Minister.


A parliamentary budget office would hence be able to provide independent analysis to confirm the nature of the Budget and that state programmes are delivering the desired outcomes, explained Mr Singh.

Mr Heng rebutted Mr Singh's arguments and the anecdote about the senior civil servant as "totally convoluted (as) one does not lead to the other".

The Ministry of Finance (MOF) had released its interim assessment on the impact of Covid-19 Budget measures earlier this month, ahead of the Budget speech, so as to be accountable about the outcome of various support measures, said Mr Heng.

"There is a reason why I put out the interim report, even though the full effects have not been (felt), because I am conscious that we have used a big part of last year's Budget, we have used the past reserves, and that I have a responsibility to account for those outcomes," said Mr Heng.


The MOF's report on Feb 11 showed that Budget measures to combat Covid-19 last year helped to blunt the recession, saved or created some 155,000 jobs over 2020 and into 2021, and shaved the rise in unemployment rate by 1.7 percentage points.

A total of $27.4 billion in grants - 18 times the amount given out in 2019 - was used to shore up beleaguered firms. Support was tilted towards harder-hit sectors, smaller firms and lower-income households, which mitigated the uneven impact of the pandemic and reduced inequality, said Mr Heng.


Mr Heng asked if Mr Singh or any of the WP MPs had read the interim report, and questioned the purpose of setting up a new office when information on the impact of programmes in last year's Budget was already readily available to be scrutinised.

"Does the Workers' Party have any comments on that, because I sat through the debate, I read your transcripts, but no one mentioned about outcomes, no one raised a question about could this have been done better, could that have been done better," said Mr Heng.

"So what is the purpose of setting up an office when the information that is publicly available is there for you to ask?"

In response, Mr Singh said that the proposed parliamentary budget office will balance out the MOF and its political office-holders' agendas by providing a perspective that is "completely independent of what Government is saying about the outcomes".

The office can therefore aid all MPs - who have to vote on the Budget - with an independent analysis on the efficacy of government programmes, he added.


Mr Heng said that the details of different schemes gets discussed in the debates over the various ministries' budgets.

"This Budget debate is a serious debate about whether our broad direction is correct, and do you have suggestions on how we can do it better? I'm open to your ideas, but I have to say, unfortunately, so far I have heard none," he told Mr Singh.

During the debate on MOF’s budget later in the day, WP MP Jamus Lim (Sengkang GRC) also suggested setting up an independent fiscal council to evaluate the budgetary implications of major policy proposals by the Government and opposition, at a proposed cost of $20 million.


Ms Indranee Rajah, Second Minister for Finance, said that similar entities in countries such as Australia, the Netherlands, UK and US, were created in the aftermath of the Global Financial Crisis from 2008 to 2009.

“In these cases, fiscal rules had proved insufficient to ensure prudent management of the public finances before the crisis,” she said.

“The context in Singapore is very different. The ills which led to the need for IFIs (independent fiscal institutions) in other systems are not present in our system and we continue to keep a very strict eye on our fiscal prudence.”

She added that Singapore has a strong system to scrutinise budgetary matters, and is among a small number of countries with a AAA credit rating.

“Most importantly, the Government has been upfront about the hard choices that we have to make on budgetary matters. For example, we have not shied away from highlighting the need to raise taxes to meet longer-term increase in healthcare and social spending needs,” she said.


Noting that members of an independent fiscal council are not elected representatives, Ms Indranee said difficult decisions cannot be outsourced, and that political leaders ultimately have to be the ones with the courage to make the tough decisions on what to spend on.

“Robust, intellectually honest analysis is important, to foster more informed parliamentary debate,” she said.

“But ultimately, this is no substitute for having the political courage to make difficult budgetary choices.”

 

[jw5]

Deities. Chinks pray to deities when they want good fortune, of course must show sincerity no?

Sincerity is the most flattering form of imitation.

 

[jw5]

from straitstimes.com:

Budget debate: Singapore must protect reserves, not in national interest to reveal its size, says DPM Heng


SINGAPORE - Singapore's reserves play critical roles in stabilising the economy during crises and shocks and providing a steady steam of revenue, and any decision on the use of the strategic assets is not taken lightly, said Deputy Prime Minister and Finance Minister Heng Swee Keat on Friday (Feb 26).

Wrapping up the debate on the Budget, he reiterated the importance of carefully husbanding the past savings, saying: "We have inherited a strategic asset for the long-term survival and success of Singapore. Protect it, nurture it, and never squander it."

Mr Heng noted that by staying true to values of prudence and stewardship, Singapore had built up significant reserves - and the confidence to deal with any crisis in its path.


Past reserves have been drawn on to deal with two crises so far: $4 billion in 2009 to deal with the global financial crisis; and up to $53.7 billion in 2020 and 2021 to respond to the Covid-19 pandemic.

The funds serve as a bulwark against extraordinary crises, he said as he outlined three key roles of the reserves.

The other two are to serve as an endowment fund, providing a key stream of revenue to supplement Singapore's annual Budget through the Net Investment Returns Contribution (NIRC) framework; and to provide a buffer against shocks and attacks on Singapore's financial system.


Singapore's past reserves comprise assets invested by its central bank, the Monetary Authority of Singapore (MAS), as well as state investor Temasek Holdings and sovereign wealth fund GIC.

Mr Heng explained Singapore's "two-key" approach to managing and safeguarding its reserves - with the President serving as custodian, and the Constitution vesting in the President discretionary powers to withhold assent to budgets and expenditures proposed by the Government that may lead to a draw on past reserves.

"It is public information that, under our Constitution, the President has access to information about the size of reserves," he noted.

Threat of speculation
Over three days of debates, there were MPs, like Mr Alex Yam (Marsiling-Yew Tee GRC ) and Mr Liang Eng Hwa (Bukit Panjang), who cautioned against dipping too readily into the reserves, and those like Non-Constituency MP (NCMP) Leong Mun Wai, who suggested tapping more of it through the NIRC.


Fellow Progress Singapore Party NCMP Hazel Poa also called on the Government to reveal the size of the pot.

To her, Mr Heng said this was akin to laying bare Singapore's defence plan - and would diminish the value of Singapore's reserves as a strategic defence.

"No responsible leader would do so," he added.


Pointing to Mr Saktiandi Supaat (Bishan-Toa Payoh GRC)'s explanation on Thursday of Singapore's vulnerability to currency speculation and large capital outflows, he reiterated that it would not be in Singapore's interest to disclose the figure.

Mr Heng also said he was "very alarmed" by Associate Professor Jamus Lim's (Sengkang GRC) immediate response to Mr Saktiandi.

Noting that the Workers' Party MP had cited "theoretical" literature that speculation could be stabilising, Mr Heng said: "I would also point out that there are other academics who recognise that currency markets can be marked by massive instability."

He added that most economists today acknowledge that market-driven short-term flows are fickle and extremely volatile.

The episode involving hedge fund manager George Soros taking on the Bank of England in 1992, by betting against the sterling pound and "dramatically" destroying the United Kingdom's monetary system, is a stark example, he said.

"To put it simply, foreign exchange speculations have been and continue to be a threat to economies, especially small, open ones like ours," added Mr Heng.


Singapore, being a financial hub, had portfolio and banking-related flows that amounted to $294 billion last year, amid volatility in the global financial markets sparked by the pandemic, he noted.

This represented 63 per cent of gross domestic product.

"MAS kept the Singapore dollar nominal exchange rate stable during this period, backed by the full power of our reserves, giving banks and businesses certainty to make decisions under very trying circumstances," he said.

DPM Heng's experience during Asian, global financial crises
Mr Heng then related his personal experience during the Asian financial crisis in the late 1990s, when he was serving as principal private secretary to founding Prime Minister Lee Kuan Yew.

Mr Lee had been invited by several countries in the region to share his views, as the Singapore dollar, backed by the reserves, was relatively unscathed by currency devaluation crisis.


"It was very painful to see how speculation and the currency volatilities that those countries faced were destroying businesses, big and small, and the lives of the men and women in these places," said Mr Heng.

He noted that the Singapore dollar is one of the most actively traded currencies in the world relative to the country's GDP. The currency's daily turnover is estimated at US$37 billion (S$49 billion) globally, or annual turnover of US$9.5 trillion, far exceeding Singapore's nominal GDP of US$350 billion.

Compared with other countries, the exchange rate is far more important for Singapore, which is unique in its operation of an exchange-rate-centred monetary policy, noted Mr Heng.


As managing director of MAS during the global financial crisis that started in 2008, Mr Heng said his team had to guard not just against the failures of banks, but also against the flights of capital and the risks of speculation on the Singapore dollar.

As a board member of MAS now, he added, he wanted to ensure the authority can continue to effectively use Singapore's exchange rate to deliver price stability.

"A very volatile Singapore dollar exchange rate, subject to market fads and bubbles, would not ensure low and stable prices for Singaporeans," he warned.


He noted that in normal times, Singapore's reserves also underpin its AAA sovereign credit rating and confidence in its exchange-rate monetary policy system.

"As a practitioner at the front line who tries my best to understand the intricacies of the system, I must caution Associate Professor Jamus Lim - let us not play with fire," said Mr Heng. "This is about the lives of our people, not theoretical musings."

"And I urge all members of this House to focus the debate on the merits of the policies and programmes and how we can improve the lives of Singaporeans, instead of repeatedly focusing their attention on the size of the reserves."

 

[jw5]

from straitstimes.com:

Budget debate: Govt should make good on amount if need to draw on reserves arises, says DPM Heng


SINGAPORE - Should there be a need for Singapore to use its past reserves to fund economic investments, the Government would have to do its best to make good on the amount drawn, said Deputy Prime Minister Heng Swee Keat on Friday (Feb 26).

He made the pledge as he assured the House that he expects to fund expenditures for the remainder of this Government’s term without a further draw on past reserves.

Even then, given the highly uncertain global outlook, there is a need to think ahead and plan how Singapore can respond if the situation evolves, he said, as he explained the circumstances under which Singapore might have to tap past savings.


Nominated MP Hoon Hian Teck had spoken during the Budget debate about the difficult balance Singapore will have to strike: stabilising the economy to avoid a sharp downturn, but also investing in structural policies for transformation.

Referring to this, Mr Heng said the uncertainty over how quickly the global economy will recover makes the balancing act even more complicated.

"If we face a prolonged slump, it will be even more necessary for us to transform, but it will also be more challenging to find the required fiscal resources to both stabilise and restructure the economy," he added.


He said it was important to press on with economic investments and secure the next decade of growth, warning that holding back would mean missing out on restructuring and new opportunities.

"If we fail to change, and our economic recovery is sluggish, it would have a long tail effect on our jobs and economic vibrancy, and affect Singaporeans adversely. It will also further worsen our fiscal situation," he stressed.

"After considering the various options, if the public health and economic situations deteriorate sharply and our fiscal situation turns out to be worse than expected, the Government may again have to seek the President's approval for the use of past reserves to continue such economic investments."

He added that President Halimah Yacob had expressed her understanding towards the Government's approach, and will consider specific proposals should there be a need to draw on past reserves.


"These investments are expected to yield returns for the economy, which can give a boost to our tight fiscal situation and allow us to make good the amount drawn," he said.

Meanwhile, he also said that the expected draw of up to $53.7 billion in 2020 and 2021 to respond to Covid-19 was equivalent to about 20 years of fiscal surpluses.

"It will be a challenge to also make good this amount drawn given the magnitude of the crisis," he added. "Nonetheless, we should strive to remain fiscally prudent to build back our reserves gradually."

Reserves not a 'gold mountain'
Mr Heng also warned that the reserves should not be treated like a "gold mountain", in responding to Non-Constituency MP Leong Mun Wai's suggestion to use 100 per cent of the returns from investing the reserves.

Currently, the Government can spend up to 50 per cent of long-term expected real returns, including capital gains, on its relevant assets, through the Net Investment Returns Contribution (NIRC) framework.

For the Government to use all of the returns is akin to treating the reserves as a "gold mountain", said Mr Heng.

"If we adopt (Mr Leong's) suggestion, one day even this mountain will be eaten up completely… We have a responsibility to future generations."

He explained that the NIRC framework smooths the volatility arising from sharp fluctuations in the asset base due to market cycles, and avoids a boom-bust pattern in government spending.


He added: "However, some variation is still to be expected for the NIRC as we update the net asset base and investment income figures over the course of the year… How post-Covid-19 structural changes will affect long-term returns is still being played out."

He noted that NIRC was already the largest single source of Government revenue - above corporate income tax, personal income tax or the goods and services tax - and that this was the result of years of fiscal discipline and did not happen by chance or good fortune.

"If we had succumbed to the temptation to spend more, we would not have built up our reserves. And without reserves, we would not have been able to generate this stable and recurrent source of revenue today," he said.

 

[jw5]

from straitstimes.com:

Budget debate: What will improve workers' lives are better wages, prospects, says DPM Heng

SINGAPORE - What will improve the lives of workers are better wages and better prospects, rather than a bigger wage share of the country's gross domestic product, said Deputy Prime Minister Heng Swee Keat on Friday (Feb 26).

He was refuting Non-Constituency MP Hazel Poa's comment that Singapore workers are worse-off due to lower wage share of gross domestic product (GDP).

"A capital-intensive economy open to investment and trades can have lower wage shares than labour-intensive economies," he said.


For example, he noted that the wage share of the biomedical sector's output is less than 6 per cent, compared with over 60 per cent in the accommodation and food services sectors. But workers in the biomedical sector earn more than twice those in accommodation and food services.

"What will improve the lives of our workers are better wages and better prospects, not the aggregate share. What matters more is that wage growth for our workers is in line with productivity (growth) so that it is sustainable," Mr Heng said.

Uplifting workers' wages and helping the vulnerable in employment is also important, he noted in response to Mr Darryl David (Ang Mo Kio GRC) and Mr Faisal Manap (Aljunied GRC) who welcomed the salary increase for healthcare workers, and have asked for the wages for other frontline workers and sectors to be enhanced as well.




"There are good, meaningful jobs in healthcare for our locals, and it is important to pay them the salary that they deserve - commensurate to the work that they do," Mr Heng said. "This is how we are able to attract and retain locals in the long-term, even as other markets compete for our Singaporean talents."

He also responded to Nominated MP Mr Raj Joshua Thomas and others who spoke about the need to continue boosting the incomes of lower-wage workers, and the Progressive Wage Model.

Mr Heng noted that citizens' real incomes from 2016 to 2019 at the 20th percentile grew at 4.4 per cent per annum, faster than at the median at 3.7 per cent per annum.

Helping low-wage workers and self-employed persons continues to be a work in progress, he added.

"I hope that if some of the new measures lead to a modest increase in costs, caring Singaporeans will agree that this is worth doing for solidarity," he said.

Mr Heng also noted that the Government is pushing ahead with its plan to raise the retirement and re-employment ages next year to support older workers.

More also can be done to boost the hiring of persons with disabilities, he said.

"Helping every Singaporean achieve their potential is a key priority for us in building an inclusive society. We agree that more can be done, and there are plans in the pipeline."

 

[jw5]

from straitstimes.com:

Budget debate: Multiple layers of support to help S'poreans cope with impact of Covid-19, says DPM Heng


SINGAPORE - From vulnerable segments of the population to the middle class and women, different groups of Singaporeans have been affected in different ways by the pandemic, and the Government has taken a customised approach to help them, said Deputy Prime Minister Heng Swee Keat on Friday (Feb 26).

There are the broad-based, permanent schemes that provide a safety net for all Singaporeans.

On top of these are temporary assistance schemes, such as initiatives like the Solidarity Payments, Temporary Relief Fund and Covid-19 Support Grant, to provide additional support, especially for vulnerable groups.

Addressing MPs' concerns about those hit hard by the pandemic-fuelled downturn, Mr Heng, who is also Finance Minister, said: "We cushioned the vulnerable against the worst of the crisis and mitigated social inequality."

He noted that the multiple layers of support helped bring down Singapore's Gini coefficient, after taxes and transfers, to a record low. The Gini coefficient - a measure of income inequality from 0 to 1, with 0 being most equal - went from 0.452 to 0.375 last year.

During the debate on the Budget, MPs from both sides of the aisle had acknowledged the efforts in this area, while suggesting ways for the Government to do even more.

Leader of the Opposition and Workers' Party (WP) chief Pritam Singh, had highlighted the plight of lower income families, noting that there was a divergence between the data on inequality and their lived experiences.

In response, Mr Heng said the Government was fully aware that some families had been hit more badly: "This is exactly why we have tilted our support significantly towards the lower-income and vulnerable groups and Government has partnered a community to reach out to those groups."

He stressed that conclusions about the support given should not be drawn based on one sample alone, but rather the totality of Singapore's policy measures.

Help for middle-income earners and women
Some MPs like Mr Gerald Giam (Aljunied GRC), from the WP, and Ms Jessica Tan (East Coast GRC) had lamented that the middle-income earners may have missed out on support measures.

To them, Mr Heng said the bulk of every Budget goes towards uplifting all members society, including the broad swathe of Singapore's middle class.

He added that $42 billion was set aside in this Budget for social spending and transfers, 35 per cent more than the 2019 financial year.

Pointing to the different support schemes, he said there are some which target those with less means, and others, like the upcoming $100 Community Development Council (CDC) vouchers, which will be given to all Singaporean households.

He also urge people to look at each Budget in terms of whether the spending creates more opportunities for them and their children, and not just what handouts they will receive.

For instance, expenditure on security makes Singapore safe and allows property and asset prices to rise over time in line with the country's economic fundamentals.

Investments in the economy also ensure that people have access to good jobs, he said.

Through providing affordable and quality housing, as well as support for young families and seniors, people can also achieve their aspirations for a better future, Mr Heng said.

He pointed to how subsidies for the purchase of Housing Board flats, at the current income ceiling of $14,000, gives eight in 10 Singaporeans access to affordable housing.

Over the years, families with children have also got help to defray the cost of education and childcare through broad-based grants, subsidies and tax benefits, said Mr Heng in response to Ms Cheng Li Hui (Tampines GRC) and Ms Hany Soh (Marsiling-Yew Tee GRC), who asked for more to be done to support parents.

Other like Minister of State for Social and Family Development Sun Xueling and Parliamentary Secretary for Health Rahayu Mahzam, spoke about creating more job opportunities for women and helping them adopt technology, among other things.

To them, Mr Heng said: "These are good points, which we can continue to work (on) together."

WP MP Louis Chua (Sengkang GRC), meanwhile, hoped more could be done to help seniors save for retirement, and Mr Heng assured him of the Government's commitment to do so through the Central Provident Fund system, Silver Support Scheme and Matched Retirement Savings Scheme.

"We are also in a fortunate position where most of our seniors have housing assets that they could use to support their retirement if they choose to," said Mr Heng.

He added that Singapore has also been investing in good and affordable healthcare for all Singaporeans, especially the elderly. To meet the needs of an ageing population, healthcare spending over the last decade has almost tripled from $3.9 billion in financial year 2011 to $11.3 billion in financial year 2019, he note.

He said this has resulted in good health outcomes, with Singapore doing well on the Bloomberg Health-Efficiency Index, which measures life expectancy as compared to medical spending.

Responding to Non-Constituency MP Leong Mun Wai from the Progress Singapore Party, who had charged that there was a lack of long-term support for Singaporeans, Mr Heng said: "So, with the most important items in life well taken care of, I hope members like Mr Leong Mun Wai will agree that his position that our support is 'ad-hoc, short term and unpredictable' is wrong, and in fact, our support is systematic, well structured and balanced."

Mr Heng added that the tax and transfer system had been gradually tilted in favour of lower- and middle-income groups over the past decade.

On average, lower-income Singaporean households can expect to receive benefits of $6,500 per person this year, after accounting for taxes. This figure is $3,500 for those from middle-income households.

Meanwhile, the highest-income households instead pay about $9,500 in taxes per person, after accounting for benefits, he added.

Unemployment insurance
Mr Patrick Tay (Pioneer), Nominated MP Hoon Hian Teck and the WP's Mr Chua had suggested that Singapore study the viability of an unemployment insurance for workers.

Mr Heng said that while unemployment insurance appears attractive, this would not be sustainable without longer-term structures in place to help workers bounce back.

In countries like Germany, Sweden, and South Korea, unemployment insurance schemes are linked to active labour market policy measures which aim to get an affected worker back into a job quickly and avoid skills atrophy, he noted.

"Instead... a job is the best welfare," said Mr Heng, echoing a view expressed by Mr Xie Yao Quan (Jurong GRC).

"It is more sustainable to ensure that workers maintain a source of income, and to upskill and re-skill our workers, so that they can bounce back quickly from job disruptions."

At the same time, the nature of jobs and skills will be changing faster as the global economy goes through an even faster pace of change, Mr Heng added.

"We will partner our business leaders, (the) labour movement, and academics to study how to support employability and help those who falter through measures that suit our context."

 

[jw5]

Deities. Chinks pray to deities when they want good fortune, of course must show sincerity no?

It is better to be sincere than to be dishonest.

 

[jw5]

from straitstimes.com:

Budget debate: S'pore must press on with plans for next growth phase, says DPM Heng


SINGAPORE - With a narrow window of opportunity in which to transform its economy, Singapore has to press ahead with planned investments in order to secure its next decade of growth, Deputy Prime Minister and Finance Minister Heng Swee Keat said on Friday (Feb 26).

Doing so would enable the economy to provide jobs in new areas even as it restructures, and enable the country to emerge stronger after the Covid-19 pandemic has passed.

And if it has to draw on the country's reserves to do so, it should do its best to make good on the draw, he told Parliament.

"Now is the time to chart our course, position ourselves to catch the winds of opportunity and sail boldly in the reshaped world," he said in his speech rounding up three days of debate in which 65 MPs spoke.

Mr Heng set out what it means for Singapore to emerge stronger together - the theme of this year's $107 billion Budget - and stressed that the Government cannot do this all alone.

"The Government is committed to put in the investments," he said. "To succeed, every Singaporean must come together to build the Singapore that we want."

By creating opportunities for workers to acquire skills needed for the new jobs of the future, the Government would help them stay employable, and also help prevent a "Covid-19 generation" of young people without jobs.

He called on businesses to look beyond hiring just "plug and play" workers and consider taking on those with potential to learn. At the same time, job seekers should keep an open mind, taking the initiative to build new skills and staying receptive to new job roles.

Singaporeans must also look out for one another, he said, adding that the Government will push ahead with plans to develop deeper capabilities in the social sector.

At the same time, Singapore has to consider how to pay for the choices it makes, Mr Heng said, noting that discussions on building a society with better social safety nets are "only one half of the conversation".


"We must be upfront - if we want to spend more, we have to raise the revenue," he said, reiterating that the impending goods and services tax (GST) hike from 7 per cent to 9 per cent, which will take place soon, between next year and 2025, is necessary to fund Singapore's rising spending needs in areas such as healthcare.

"Economic growth alone is not likely to raise enough revenues to fully meet our needs," he added. "The honest, but hard, conclusion is that we will need to raise more tax revenue."

The GST hike will be matched with a $6 billion Assurance Package that effectively delays its effect for at least five years for most Singaporean households, he said.

Mr Heng acknowledged that it is natural for everyone to look out for what is new in each year's Budget. But Singaporeans should also appreciate what is already there, and look at the nation's spending in totality over the years, he said.

Over the past decade, Singapore has been gradually tilting its system of taxes and financial transfers in favour of lower-and middle-income groups, he noted.

This year, a member of a lower-income citizen household can expect benefits of $6,500 after taxes on average, and a member of a middle-income household gets $3,500. In contrast, a member of a household in the highest income group pays around $9,500 in taxes, after accounting for benefits, he said.

Mr Heng also addressed concerns MPs raised that this year's Budget appears to have little short-term support for middle-income households. This is not so, he said, noting the $42 billion set aside for social spending and transfers on top of security spending and economic investments, all of which benefit Singaporeans.

"We should not look at each Budget in terms of 'goodies for me', but whether the totality of the spending creates more opportunities for us and our children."

He also cited Nominated MP Hoon Hian Teck, who on Wednesday articulated Singapore's need to balance stabilising the economy to avoid a sharp downturn, and investing in structural policies for transformation.

Mr Heng also noted how Mr Shawn Huang (Jurong GRC) put it aptly when he said that for Singapore to survive, it had to pivot and develop an edge to seize opportunities of the future. "If we get this right, we can set our economy on the path of growth for the next five to 10 years," said the DPM.

 

[jw5]

from straitstimes.com:

Budget debate: DPM Heng reminds the House of hard truths

SINGAPORE - "Please do not put words in my mouth."

If there was one thing that stood out in a couple of the exchanges that followed Mr Heng Swee Keat's Budget round-up speech on Friday (Feb 26), it was that the cerebral, soft-spoken Deputy Prime Minister seemed genuinely angered.

The first subject of his ire was the Workers' Party's Jamus Lim (Sengkang GRC), who sought clarification on why Mr Heng was "dismissive of soft capital".

Associate Professor Lim had earlier defined this as human capital, saying that the new bonds which the Government will issue can also be used to fund human capital investments.

Mr Heng had a firm response: "You said I was dismissive of soft capital. I (was) not... I sounded a word of caution about soft capital. Precisely because it is soft, it can morph into various shapes."

In his round-up speech, Mr Heng had explained that in many countries, there is a tendency to expand the scope of what constitutes "soft capital" beyond its original intentions.


When borrowing is used to fund increases to government subsidies or social transfers, this is really more recurrent spending, he said. And borrowing continuously for them will simply lead to growing debt.

He was also quick to set Mr Louis Chua (Sengkang GRC) right on the issue of using land sales proceeds directly in the Budget. Mr Chua had argued that land sales can be a recurring source of revenue, noting that incentives to use land sales revenues "already exist today".

Under the Constitution, state land and land sales revenues form part of Singapore's past reserves which are invested. Land sales revenues are not available for budgetary spending.

"I think you should seriously look at what agencies have been doing. Do not make allegations like this, because I think it will demoralise the many good officers that we have," Mr Heng told him when responding. "Let me repeat that the Government has no incentive to sell land for the purpose of generating revenue."

There was an urgent tone to the DPM's delivery on Friday. Urgent because there is no time for academic debate - only a narrow window of opportunity for Singapore as jobs and firms around the world reconfigure amid the pandemic.

Unlike last year, when emergency relief was front-loaded in the five Budgets, Mr Heng had to drive home the message that firms and workers must transform and pivot.

He also had to simultaneously assure the public that the Government would not leave them to struggle alone, given the petrol duty hike and the likelihood of a goods and services tax (GST) increase in the near future.


The Government has rolled out close to $100 billion in Covid-19 support measures. Yet ask a Singaporean today, and he may still not be able to explain how the money benefits him except for U-Save and GST vouchers.

If he is a taxi or private-hire driver, what he may feel, viscerally, is that the petrol duties will hit his take-home pay.

But the truth, as inconceivable as it may be to some, is that state support during the pandemic has reached into the lives of each and every Singaporean - from broad-based cash handouts to wage and training subsidies.


So even as Mr Heng ran through the standard report card on Friday, he had to reiterate - just as he did for the $6 billion Assurance Package to cushion the impact of a GST hike - that those who drive for livelihoods will receive extra petrol duty rebates on top of road tax rebates.

He also sought to focus people's minds away from short-term goodies, onto three larger themes: an economic strategy to emerge stronger together; a cohesive and liveable Singapore; and a prudent fiscal strategy for the long term.

The key thrusts were these:

First, the fiscal firepower has prevented deep economic scarring and preserved human capital.

At the heart of Singapore's shift to a technologically advanced, innovation-driven economy will be a strong Singaporean core.

Second, every future generation should be better off than the last, and the Government is prepared to invest in this future.

Here, Mr Heng laid down four covenants between the Government and Singaporeans to stand the test of time: They can always have a home to call their own; their children will be nurtured in a world-class education system; seniors will have assurance over their retirement; and families' healthcare needs will always be well taken care of.

Third, a prudent fiscal strategy for the long term. Crises will come and go, but the values of prudence and responsible stewardship are sempiternal.

The draw on past reserves is equivalent to about 20 years of fiscal surpluses. The country must strive to remain fiscally prudent to build back its reserves, he said. "It will be a challenge to also make good this amount drawn, given the magnitude of the Covid-19 crisis."


The stark bottom line is this - if Singapore wants to spend more, the Government has to raise the revenue to do so.

And if these are recurrent needs which have to be financed year after year, then it must find recurrent revenues such as from the GST, which it can collect year after year.

Will the Government look into other ways to generate revenue? The jury is still out, but Mr Heng did not shut the door on wealth or property-related taxes.

The point he made was that neither would replace the need for the GST rate increase - which in itself will not yield enough revenue to meet the Republic's growing healthcare and social spending needs.

"We will continue to review additional options to complement a GST rate increase, but it is not realistic to hope for these to become alternatives to a GST rate increase, or to make the GST rate increase unnecessary," he said.

He clarified that the Government does tax wealth and has been raising wealth taxes over the years, but "the practical question has always been how to design wealth tax moves to ensure that they are effective".

He also said that the Government will study Mr Liang Eng Hwa's (Bukit Panjang) suggestion of a one-off, special purpose borrowing.

It has not been hard for both sides of the House to agree on the need for more holistic support for disadvantaged families, affordable healthcare and to uplift low-wage and older workers.

But it has been far harder to meet halfway on how to do so. Some proposals, such as Non-Constituency MP Leong Mun Wai's suggestion for the Government to fund insurance premiums of the MediShield Life and CareShield schemes for all Singaporeans and permanent residents are fiscally ruinous, given the ageing trajectory of Singapore's population.


Others, like the progressive wage model (PWM) versus minimum wage debate, inhabit a greyer area where some of the disagreement is an issue of political philosophy and semantics. As Senior Minister Tharman Shanmugaratnam had said previously, the PWM is essentially a minimum wage-plus with a sectoral approach.

Yet even proponents of the PWM would admit to how fiendishly difficult it can be to get companies on board; or to drive, let alone quantify, productivity growth which so much of the PWM is premised on.

On stagnating global productivity growth, economist Robert Solow famously remarked that "you can see the computer age everywhere but in the productivity statistics".

And when it comes to taxes, public opinion often weighs not on the side of hard numbers, but the perception of fairness. How can wealth taxes be effective, instead of simply being a state-legislated form of schadenfreude by the poor and middle-class against the rich?

These are issues that cannot be resolved immediately. But as the House began debating ministries' budgets, one looks forward to more details on how effective the existing measures have been, how they will be fine-tuned or enhanced, and why future plans will make a difference in Singaporeans' lives and livelihoods.

 

[jw5]

from straitstimes.com:

Businesses can serve as a bridge between countries: Heng Swee Keat

SINGAPORE - As strategic competition between the United States and China grows, the corporate world can serve as a bridge between societies, said Deputy Prime Minister and Finance Minister Heng Swee Keat on Tuesday (March 9).

And as American companies scour the region for new investment opportunities, Singapore can serve as a base for them, he added.

"While the global order is largely determined by the actions of governments, the corporate world can be a bridge between countries, societies and cultures," Mr Heng said, noting that American businesses have an important role to keep globalisation going as the world turns inwards.


They can do so by strengthening constructive efforts to reform the system, and supporting efforts to develop "a robust rules-based system, with dispute resolution mechanisms that all can abide by".

Mr Heng was speaking to business leaders, government representatives and policy experts from the United States and Asia Pacific at the AmChams of Asia Pacific Business Summit, organised by the American Chamber of Commerce (AmCham) in Singapore.

The three-day conference, which ends on Thursday, features a mix of virtual and in-person events at Marina Bay Sands. Speakers will address the topic of transformation from various angles, including how industries and government policies can change.


In his speech, Mr Heng set out three challenges businesses will face operating in the Asia-Pacific region, and identified three potential areas of growth.

First, there is uncertainty about the shape of the Covid-19 trajectory. Although most countries in the region have handled the pandemic well, they will need to redouble their vaccination efforts in order to stay ahead of the crisis, he said.

"The pandemic cannot be fully controlled anywhere until it is stopped everywhere," Mr Heng said, adding that businesses can help in various ways. These include contributing to the global Covid-19 Vaccines Global Access (Covax) scheme and facilitating the transport and distribution of vaccines.

Growing US-China strategic competition will pose a second challenge, Mr Heng said, noting how neither country wishes to appear weak before its domestic population. He added his hope that the new Biden administration will bring "greater predictability and nuance" to this bilateral relationship, and stressed the importance of US engagement in the rest of Asia, beyond China.


A third challenge lies in rising levels of global debt, which will have to be repaid at some point, the minister noted. "If we are not careful, the debt burden and resulting inflation could crimp the ability of economies to make sustained investments in emerging opportunities."

He urged businesses to take a long-term view of the region's growth prospects and continue to invest in emerging opportunities.

These growth areas include infrastructure, the digital economy and sustainability - all of which Singapore can add value to.

For instance, Singapore set up Infrastructure Asia in 2018 to connect governments with developers, professional service providers and financiers for the region's infrastructure needs.

And with the digital economy in South-east Asia projected to triple from US$100 billion (S$134 billion) in 2020 to over US$300 billion in 2025, US companies are "well-placed to tap on Asia's digital dividend", Mr Heng said. He noted that American firms remain at the forefront of innovation, and are helping to shape the consensus around emerging areas such as the ethical use of artificial intelligence.


"With our strong links to the region, Singapore can continue to be an effective and stable base for companies looking to expand into the region."

On the topic of sustainability, Mr Heng said Singapore aims to be a green node and is working with regional partners to provide a range of carbon services.

"We look forward to your continued investment in the region, and to stronger partnerships to realise these growth opportunities," he told the audience, stressing that the US has traditionally helped to foster regional stability and prosperity in the Asia Pacific.

"Singapore can be your base to explore the region," he said.

 

[jw5]

Deities. Chinks pray to deities when they want good fortune, of course must show sincerity no?

It is important to show sincerity before unveiling a plan.

 

[jw5]

from straitstimes.com:

Firms must collaborate, innovate and adapt to emerge stronger from Covid-19: DPM Heng

SINGAPORE - Firms must collaborate with workers, the Government and the labour movement to emerge stronger in a complex, volatile post-Covid world, said Deputy Prime Minister Heng Swee Keat.

He told a webinar on the Budget: "More than ever before, recovering from this crisis and growing our economy will have to be a tripartite effort.

"We must pull together our collective strengths and resources to ride the winds of change and waves of opportunities."


This can entail firms strengthening collaboration and forging new partnerships through initiatives like the Open Innovation Platform, which matches private and public-sector problems with solution providers.

Mr Heng also noted in a Facebook post that he had the same dialogue a year ago, when the pandemic was still rapidly unfolding.

"The situation has stabilised. Many businesses have adapted, although the path to recovery is highly uneven across sectors. What is clear is that there is no going back to pre-Covid," he said.


This is why the Budget's central focus is on emerging stronger through adapting, innovation and growth, he added.

He said at Tuesday's (March 9) dialogue organised by the Singapore Business Federation and the Singapore National Employers Federation: "To adapt, we will need to keep abreast of the structural shifts that are under way.

"Covid-19 has further accelerated some of these shifts, especially the pace of digitalisation. We will enable you to participate in the digital economy, so that no one is left behind by the forces of disruptive technologies."

Firms can use emerging technologies to turn digital disruption into opportunities, he said. They can also enable workers to thrive in the digital world through job redesign, and kick-start the digital transformation journey.


He added that innovation is key to creating new value and remaining competitive, noting that the Government will continue to nurture start-ups, while helping larger companies through corporate venturing.

It will also connect firms to innovation nodes around the world, by expanding networks and supporting cross-border partnerships.

"Through adapting and innovating, I am confident that more of you will grow. You can make the best of opportunities, especially as the economy recovers."


Companies must also put workers at the heart of their transformation efforts as they grow, he added.

"As you transform, you can create better jobs and prospects for your workers, and upskill them to take on these new roles... The fortunes of businesses and workers are intertwined. Investing in your people will ultimately benefit your businesses in the longer-term."

Mr Heng also encouraged businesses to give back to the community, citing those that returned their Jobs Support Scheme support or shared it with their workers.

He said: "We have so far put the worst of the crisis behind us.

"But I hope you will do more than just cope. Instead, you can make full use of the support provided to shift your focus towards emerging stronger."

 

[jw5]

Deities. Chinks pray to deities when they want good fortune, of course must show sincerity no?

Sincerity is important, but so is creativity.

 

[jw5]

from msn.com:

Girl gets photo with Singapore politician – sans face

 

[jw5]

Singaporeans can save on travel. PAP bring the world to SG. Just open your door is China. Travel to work is India. Go makan is Malaysia. Go hospital is flipping.

Nowadays the target is to have a travel bubble.

 

[jw5]

from straitstimes.com :

Volunteer your time and expertise to help close S'pore's digital skills gap: DPM Heng

DPM Heng Swee Keat exploring how technology has been embedded into the city by holding a tablet over a model of Singapore’s city area to view smart digital solutions using AR technology.


SINGAPORE - Those with the time and expertise should volunteer to help close the digital skills gap in Singapore.

This call to action was made by Deputy Prime Minister Heng Swee Keat on Thursday (March 11) as he noted that tech has helped Singapore emerge stronger from the Covid-19 crisis. Among other things, he cited contact-tracing tools that cut the time for identifying and quarantining close contacts of coronavirus patients.

Speaking at the launch of the second edition of the Smart Nation and U event at The URA Centre, Mr Heng said that Singapore must continue to raise awareness of the potential of digital technology and build a more digitally inclusive society.


But the acceleration of tech adoption in the workplace has also widened the skills gap among workers.

“As more companies look to transform, we must ensure that our workers are equipped with the digital skills to take on new roles,” said Mr Heng, who is also Coordinating Minister for Economic Policies and Minister for Finance.

To this end, he urged the public to step forward to help address the issue as part of the Singapore Together movement.


They can do so by volunteering as a Smart Nation ambassador or being part of the many ongoing collective efforts. For instance, they can join the effort organised by the Alliances for Action, which are groups formed to tackle a specific challenge under the Singapore Together movement.

Of these, there are two alliances on digital inclusion - one on expanding online learning opportunities and another on helping disadvantaged families access smart devices.

Other alliances are looking into digital transformation, including the digitalisation of supply chains and education tech.

The public can also donate to the Digital for Life Fund to support projects initiated by the community. The Government will match donations dollar for dollar.

"Building a more inclusive society will require a collective effort from all of us to progress together as one. Each of us must do our part to help those around us to be part of this digital journey," said Mr Heng, who launched the Singapore Together movement in 2019 to encourage people to partner the Government.

Under this movement are industry-led Alliances for Action that aim to quickly develop and test new ideas of growth.


On Thursday, Mr Heng pointed out that tech has improved people’s lives.

For example, as more people go digital, companies like those in print media have offered more content digitally over time too.

“The content is readily accessible, with options for larger font sizes and audio. During the pandemic, (print media) also made Covid-related resources free, by keeping them in front of the paywall,” he said.

 

[jw5]

from straitstimes.com:

Firms must invest in people to emerge stronger from Covid-19 pandemic, says Heng Swee Keat


SINGAPORE - Amid the uneven recovery from Covid-19 and stiff global competition for talent, firms must invest in their workers so as to transform and emerge stronger from the pandemic, said Deputy Prime Minister Heng Swee Keat.

At the Lianhe Zaobao Singapore Budget 2021 Business Forum on Monday (March 15), Mr Heng, who is also Finance Minister, outlined three ways in which firms and employees can work closely together.

The first is joining the Singapore Together Alliances for Action, which are stakeholder and industry-led collaborations that seize growth opportunities for Singapore. He said these alliances can harness the collective strengths of industry and the community to solve problems more effectively.

Firms should also take a long-term view of the relationship with their staff, by upgrading their skills and increasing their productivity. This, in turn, leads to more competitive industries, he added.

"The next phase of competition is the competition for talent. We must better develop our local talent, as well as attract overseas talent with specialised skills."

He added that firms should also give back to society, observing that many firms had returned or donated their Jobs Support Scheme wage subsidy payouts. Others stepped forward to help vulnerable communities.


Other panellists at the forum moderated by Lianhe Zaobao editor Goh Sin Teck were Singapore Chinese Chamber of Commerce and Industry president Roland Ng, Singapore Business Federation chairman Lim Ming Yan, Association of Small and Medium Enterprises president Kurt Wee, and UOB global economics and markets research executive director Suan Teck Kin.

The forum, into its sixth year, is one of Zaobao's key signature events and focuses on the outlook of the Budget in Mandarin through a dialogue session.

Mr Heng had announced on Feb 16 that this year's Emerging Stronger Together Budget will shift "from containment to restructuring" as Singapore's economy continues to reopen.

The $107 billion plan includes a $11 billion Covid-19 Resilience Package to safeguard public health and support workers and businesses.

A total of $24 billion over the next three years will go towards enabling firms and workers to emerge stronger in the face of structural changes.


Commenting on the ongoing economic uncertainty, Mr Heng said that how soon borders reopen depends not just on Singapore, but also on whether the world can combat Covid-19 effectively. "We also need to assess if surrounding countries are undertaking their vaccination programmes just as quickly."

All parties must also be able to agree on the approach, he added.

He said: "We originally thought that there were many countries we could partner with on reciprocal green lanes (RGLs).

"But then some of them experienced a second wave of infections, which made it harder to commit to opening RGLs within a definite timeline."

Another factor adding to the economic uncertainty is United States-China tensions.

Mr Heng noted that the US re-joining the World Health Organisation and Paris climate agreement are positive developments that will allow it to play a role in the multilateral system.

He said there are many areas of common interest which the US and China can collaborate on such as Covid-19 and climate change. The latter is of particular concern to Singapore as it is a small and low-lying island nation.

Deputy Prime Minister Heng Swee Keat (third from left) with other panellists at the Lianhe Zaobao Singapore Budget 2021 Business Forum. PHOTO: LIANHE ZAOBAO


Responding to an audience member's question on US President Joe Biden's recent signing of a US$1.9 trillion (S$2.6 trillion) Covid-19 rescue package, Mr Heng welcomed the development, saying it would have a salutary effect on the global economy.

Responding to another question on China's dual-circulation growth model, he noted that it is an "astute strategy" as China's domestic market is big enough to spur economic development from within, even as it remains connected to other countries.

The strategy was first mentioned at a meeting of the Politburo, China's 25-member policymaking committee, in 2020.

It places a greater focus on the domestic market, or internal circulation, in order to adapt to an increasingly unstable and hostile outside world. It is expected to see China place less reliance on its export-oriented development strategy, or external circulation, without abandoning it altogether.

It is not just the two major powers, but also Asean, which must strengthen cooperation, said Mr Heng.

He said the 10-member South-east Asian grouping is critical to the stability of this region, and it is important to preserve Asean centrality.

The principle of centrality goes beyond geography, to include Asean's central role in engaging major powers and maintaining the region's security and prosperity.


Going forward, all countries must consider how they can strengthen the resilience of supply chains and production, he said. On its part, Singapore has inked several digital economy agreements and invested heavily in research and development.

"We won't know exactly when the returns from these (R&D) investments will be realised - it could be five years, 10 years. But what is clear is that our investments over these years have seen breakthroughs, especially during this pandemic," he said, citing as an example the Fortitude Sars-CoV-2 and Flu A/B test kit which was jointly developed by the Agency for Science, Technology and Research, Tan Tock Seng Hospital and local molecular diagnostic company MiRXES.

"The most important thing now is to groom talent... I hope firms can support their workers' skills upgrading, and that everyone uses the (Budget) measures well so that we can emerge stronger together."

 

[jw5]

Singaporeans can save on travel. PAP bring the world to SG. Just open your door is China. Travel to work is India. Go makan is Malaysia. Go hospital is flipping.

Travel bubble with Australia is coming soon.

 

[jw5]

from straitstimes.com:

Go green to stay competitive: Heng Swee Keat to local businesses

SINGAPORE - Going green will help Singapore's businesses stay competitive, said Deputy Prime Minister Heng Swee Keat on Monday (March 15), urging local firms to take advantage of government schemes to help them make the leap.

He recounted a conversation with a German businessman in the finance industry, who told him that in Europe, it was important for every company to have some indication of its green commitments on its website.

"If your website doesn't have it, many consumers will not want to buy your things," the businessman had told him.


Mr Heng, who is also Finance Minister, noted that Singapore has grants such as the Energy Efficiency Fund, which helps firms make their industrial premises more energy efficient, as well as the new Enterprise Sustainability Programme targeted at small and medium-sized firms.

The programme, first announced last month as part of the Singapore Green Plan 2030, is meant to help firms use resources more efficiently and develop new green products and solutions.

"I know it's not easy," Mr Heng said. "But it's only when we manage to successfully do something difficult that we can truly count ourselves as being competitive."


The minister was one of five panellists at the Lianhe Zaobao Singapore Budget 2021 Business Forum. The others were: Singapore Chinese Chamber of Commerce and Industry president Roland Ng, Singapore Business Federation chairman Lim Ming Yan, Association of Small and Medium Enterprises president Kurt Wee and UOB global economics and markets research executive director Suan Teck Kin.

The discussion was conducted in Mandarin and moderated by Lianhe Zaobao editor Goh Sin Teck.

During the session, Mr Wee asked why the Government's decision to impose the goods and services tax (GST) on imported low-value goods kicks in only two years from now, given that the intention is to give local businesses a level playing field. The move to charge GST on goods worth $400 or less starts from January 2023.

"I would like to do it more quickly as well, but we need to give businesses time to prepare," Mr Heng replied, noting that certain IT processes will take around two years to change.


The topic of the work-from-home revolution also came up, with panellists elaborating on the pros and cons. For instance, companies can be more agile and even consider putting significant portions of their business in a different country, Mr Lim said. "But the thing to consider is how this will impact corporate identity and employee cohesion."

Mr Ng and Mr Suan both underlined the continued importance of face-to-face interaction, with Mr Heng adding that building relationships virtually - especially at regional Asean meetings or international events such as the Group of 20 summit - can be challenging.


Even so, remote working has proved possible for Singapore, Mr Heng said, noting that a significant proportion of his ministry's staff are still working from home.

"I don't feel that our productivity has dropped," he added. "Some have asked if they can continue working from home one day out of five after the pandemic. I said, 'Well, we will consider that.'"


Mr Heng also urged businesses to seek out opportunities to collaborate with local universities, relating an encounter he had with a stranger on a plane several years ago, when he was Education Minister.

The man, as it turned out, had flown to Singapore to seek out a local academic whose research findings held promise for improving his business. But looking into the matter later on, Mr Heng found that no local firms had approached the academic.

"This man saw the news online and took a plane to Singapore," he said. "Yet, our businesses are here and our schools are here, but why did nobody think to look this professor up?"

The country has made significant investments in research and has a pool of good talent, Mr Heng added. "We should make better use of them."

 

[jw5]

Deities. Chinks pray to deities when they want good fortune, of course must show sincerity no?

It is definitely better to be sincere than insincere.