Update 15 Apr 2016: Parliament passes $79.7b Budget
Parliament yesterday approved a $79.7 billion Budget trained on transforming the economy and building a more caring and resilient society.
These twin spirits of enterprise and care for one another are what will enable Singapore to thrive for another 50 yrs, said Leader of the House Grace Fu as she wrapped up the debate on the Government's spending plans.
MPs filed 499 cuts to ministries' budgets this year, the highest in the past 5 such debates. Each cut lets them speak on the policies and programmes of the ministries.
Budget 2016 sets trend of change for next 50 years: Halimah Yacob
This year's Budget is an important one, even as it represents a number of firsts, said Speaker of Parliament Halimah Yacob, as she drew the week-long Committee of Supply debates to a close on Thu (Apr 14).
"This year's Budget, with a number of firsts, is an important one. This is the 1st Budget of our 13th Parliament and the 1st Budget of our newly minted Finance Minister Mr Heng Swee Keat who, I must say, delivered the Budget with great panache. It is also the 1st Budget for our many newly-elected MPs, NCMPs and NMPs," Mdm Halimah said in Parliament.
Who gets what from Budget 2016?
YESTERDAY, the Committee of Supply debates drew to a close. This is the first Budget for Finance Minister Heng Swee Keat and the 13th Parliament.
Speaker of Parliament Halimah Yacob has deemed this Budget “an important one”, citing the need for Singapore to transform and stay relevant in a fast-changing global environment.
Many schemes and programmes were introduced. Here is a summary of who may benefit from Budget 2016.
- Unwed Mothers
- Primary School Students
- Secondary School Students
- Prospective Polytechnic and University Students
- National Servicemen
- Pedestrians and Cyclists
- Small and Mediums-Sized Enterprises
- Companies Looking to Automate and Grow
- Companies Looking to Expand Overseas
Partnering for the Future
Minister for Finance, Mr Heng Swee Keat, has delivered the FY2016 Budget Statement on 24 March 2016.
- Transform - Budget 2016 provides support for enterprises and industries for the next phase of Singapore’s development. The new Industry Transformation Programme will help firms and industries to create new value and drive growth.
- Innovate - Budget 2016 will see the launch of Jurong Innovation District and the setting up of the new “SG-Innovate” entity to drive transformation through innovation.
- People - Measures such as the ‘Adapt and Grow Initiative’ and ‘TechSkills Accelerator’ will help our people adapt and develop their skills.
- Seniors - The Silver Support Scheme will supplement the retirement incomes of eligible seniors, complementing other existing forms of support. The pilot Community Networks for Seniors will also forge a new way of service delivery for them.
- Families - Budget 2016 provides families with children with enhanced support and opportunities, with measures such as the CDA First Step grant, the KidSTART initiative and the Fresh Start Housing Scheme.
Singapore budget helps struggling sectors, avoids big stimulus
Singapore announced support for its battered offshore marine sector and small businesses in the budget for the fiscal year beginning April 1, but did not make big stimulus moves for an economy that's slowing but still expected to grow this year.
Finance Minister Heng Swee Keat also decided to keep unchanged property cooling measures that have hit demand and pulled down home prices in one of the world's most expensive markets.
"Many of our firms are facing weaker top-line growth, rising manpower costs and tighter financing. Workers are anxious as retrenchments has increased, including among professionals," Heng said in a speech in parliament.
MPs welcome new Business and IPC Partnership Scheme
Several Members of Parliament (MPs) have lauded the Business and IPC Partnership Scheme announced by Finance Minister Heng Swee Keat on Thursday (Mar 24).
Mr Heng had said that under the scheme, the Government will offer qualifying businesses a 250 per cent tax cut on wages and incidental expenses when they send their employees to volunteer at charities registered under the Institutions of a Public Character (IPC).
IPCs are registered charities that are able to issue tax-deductible receipts for qualifying donations.
SIATP says Budget builds on what has worked with fresh measures
THE Singapore Institute of Accredited Tax Professionals (SIATP) on Monday applauds the Singapore Budget 2016 delivered in Parliament by Minister for Finance, Heng Swee Keat, on Thursday.
SIATP chairman Gerard Ee said it was admirable that Budget 2016 has rolled-out new measures, extended schemes that have been effective and rationalised initiatives that may not have achieved the original intentions.
"This is in symmetry to the tax professionals' body earlier call that as Singapore looks for fresh programmes and ideas to revitalise itself, it is also imperative to take rear-view mirror check on specific success factors already set in place for Singapore to be able to leap ahead towards SG100 in a prudent manner amidst a competitive global landscape," Mr Ee said.
Budget 2016’s targeted approach is good, but there’s a catch
It still lacks specifics, analysts say.
Experts lauded Budget 2016’s more targeted approach at helping companies ride out the economic downturn, but cautioned that it remains to be seen how the new policies will be implemented in practice.
“The budget has a lot of specific, targeted schemes. It’s a lot of difficulty getting money out of the government for specific applications so I think jury’s still out on how this will work in practice,” said Shanker Iyer, FCCA, Chairman, Iyer Practice Advisers, speaking at the Singapore Business Review’s Budget Breakfast Briefing 2016.
Budget 2016: 10 things you need to know
Budget 2016 is a prudent one, aimed at balancing the short-term economic concerns with long-term challenges. But it is also a Budget that seeks to take care of those who may be left behind in the restructuring of the economy while fostering a sense of community spirit. The Straits Times' Janice Heng, Charissa Yong and Aaron Low wrap up some of the Budget's priorities in this special guide.
- Tackling challenges in the longer term
- Short-term relief for companies
- Investing heavily in skills upgrading
- No change to property cooling measures
- $3.4 billion surplus expected this year
- Silver Support payouts for seniors
- Help for families with children
- 'Industrial park of the future' in Jurong
- New $250m OBS campus on Coney Island
- More cash assistance for needy households
Singapore budget staves off monetary stimulus
Singapore's expanded fiscal program, unveiled in Thursday's 2016-2017 budget, may see the central bank hold off on monetary stimulus at its April meeting even as the economy flirts with technical recession.
The government will spend $53 billion for the fiscal year starting April 1, a 7.3 percent rise from the previous year and well above consensus expectations, bringing the overall budget surplus to $2.5 billion, Finance Minister Heng Swee Kiat announced on Thursday.
The bulk of funds are directed at supporting businesses, especially small and medium sized enterprises (SMEs), with measures including higher corporate income tax rebates. Meanwhile, higher levies on foreign workers—monthly fees local businesses pay for each foreign worker—will be deferred for certain struggling industries, such as the marine sector. Investment in public infrastructure projects will also increase, said Heng.
Budget 2016: Business leaders' wish list
GIVEN the uncertain economic landscape, we expect this Budget to focus on helping businesses, particularly local enterprises, create value through innovation.
One way in which the government can help such local enterprises (especially those without critical mass) in their pursuit of new markets is to set up a "one-stop shop" to help them navigate the plethora of assistance schemes (grants, tax incentives, financing, and so on) that are available. One agency acts as a "relationship manager" to perform a preliminary assessment of the SMEs' plans, recommend the most appropriate assistance schemes and guide them through the application process.
This collaborative approach will be yet another testament to the strength of Singapore Inc.
Singapore Budget 2016: What’s in store for startups
Innovation and enterprise were some of the keywords in Singapore’s finance minister Heng Swee Keat’s speech during the 2016 Budget announcement today. A big part of the speech focused on the need for Singaporean businesses to grow, embrace modern technology, and grow beyond the country’s borders.
Here are the key highlights of the budget speech that are relevant to startups:
- Industry transformation
- More support for startups
- Research top-up
- Building technical talent
- Innovation park
More cash aid for low-income group in Singapore
Any responsible government takes pains to look after the welfare of its people, particularly those who need help most.
And Singapore is no different. Yesterday, its government announced special cash assistance to lower income group.
Different countries have different approaches. While some give out cash vouchers, others provide food stamps or even cash.
Singapore To Spend More For 2016
Singapore's 2016 Budget, which was unveiled today, will see the government's spending increase by 7.3 per cent, or S$5 billion (S$1=RM2.95), from last year.
"The increases will mainly be in healthcare, education, security and urban development," said Finance Minister, Heng Swee Keat, when delivering the Budget at the Parliament here today.
The budget has three key thrusts to address the challenges in its economy.
Singapore's 2016 Budget: Back to basics
Singapore's government will use its latest budget to boost an economy at risk of technical recession, steering away from the recent focus placed on social spending sweeteners in one of the world's most expensive cities.
Since 2012, Singapore's ruling People's Action Party (PAP) has concentrated its firepower on alleviating livelihood concerns, with measures aimed at addressing the widening income gap, under-investment in public housing and over-burdened transportation infrastructure.
The steps were "a wake-up call for the incumbent party after suffering its lowest public approval ratings in the 2011 general elections," observed Francis Tan, economist at United Overseas Bank (UOB).
Budget 2016: Inclusive goodies for families and businesses
Parents and parents-to-be, small and medium enterprises and the elderly were among the biggest winners in this year’s Budget, even as Finance Minister Heng Swee Keat warned of strong economic headwinds. His maiden Budget drew generally positive reactions from these groups, while other Singaporeans questioned if more could have been done for the vulnerable groups.
Small and Medium Enterprises - Among other initiatives, the corporate income tax rebate will be raised from 30 to 50 per cent of tax payable, with a cap of $20,000 rebate each year. The Special Employment Credit (SEC) is also being modified and extended to the end of 2019. This will provide employers with a wage offset for workers aged 55 and above who earn up to $4,000 a month.
Edward Chia, 27, owner of Korean take-out business Dosirak, cheered the Budget goodies to help enterprises like his. He said that the tax rebate would enable him to consider giving slightly higher bonuses to retain Singaporean employees, who are especially hard to come by in the F&B industry.
Budget 2016: Greater Dependence on the Reserves
One of the things that jumped out in Budget 2016 was the huge increase in the projected Net Investment Return Contribution (NIRC) to $14.7b from the final figure of $9.9b for previous year, itself a large upward revision from the initial estimate of $8.9b.
The NIRC is the amount of expected long term real returns on financial assets managed in the main by GIC, MAS and Temasek which the government is permitted by the Constitution to spend, subject to a maximum of 50% of said returns.
For 2016, the $14.7b projected NIRC kept the overall budget in surplus by $3.45b (excluding land sales revenues and the remaining 50% of the NIRC). That means without such a large input from the NIRC, the government would be running a budget deficit of $11.255b or 2.6% of projected 2016 GDP. The table below shows the overall budget surplus or deficit position, the amount of NIRC and the budget position without the NIRC since 2011.
Budget 2016 a good shift towards helping less-privileged get a fairer start
What a difference a year makes. Basking in the glow of SG50, and tapping on the reserves built up in their term of government; Deputy Prime Minister (DPM) Tharman Shanmugaratnam announced one of Singapore’s most socially progressive budgets last year.
No one expected this year’s budget to be as generous, since this is the first Budget by the new government and it cannot tap on past years’ surpluses or the reserves.
This is also Finance Minister Heng Swee Keat’s maiden budget. Despite being a ‘business-minded’ budget, Heng did sneak in a couple of progressive social policies, targeting needy young families.
Is this year’s Budget “particularly prudent”?
FINANCE Minister Heng Swee Keat told us to expect a “particularly prudent” Budget. In the absence of any further details, commentators figured there’d be at most a modest increase in spending. So Mr Heng’s announcement that the G plans to increase spending by $5.0 billion (7.3 per cent) this year caught some by surprise.
Could the G increase spending substantially and still end up in surplus? It already ran a record $6.7 billion deficit last year. To balance the books, revenues would need to jump $11.7 billion – 18 per cent from last year’s estimates – a very unlikely scenario given the lacklustre economy. So it would be in the strange situation of running a deficit, while claiming to be “prudent”.
And a deficit this early in the G’s term may have posed problems in the future. Because it must balance its books between elections: to start a new term with a deficit would mean we’d need surpluses to compensate over the next few years.
Budgeting for the Future
The annual Budget is akin to the Government’s game plan for at least the financial year ahead. But as much as it essentially catalogues the Government’s goals and how it plans to achieve them, it also highlights the challenges that the country is facing.
Some of these challenges have to do with social issues. For example, there is the low birth rate of Singaporeans, as well as rising cost of living. Social activist and former Nominated Member of Parliament, Kanwaljit Soin, also points out that despite being the third richest country in the world in terms of GDP per capita, Singapore has high income inequality.
To address these issues, Budget 2016 “builds on the schemes introduced in the previous budget and provides more support to youths, families, vulnerable groups, low wage workers and seniors”, says Member of Parliament and Government Parliamentary Committee Member for Finance and Trade and Industry, Saktiandi Supaat. The measures announced include a3,000 SGD grant for children’s healthcare and childcare needs, a one-off GST voucher of up to 500 SGD for Singaporeans whose annual incomes are less than 26,000 SGD, and larger pay-outs to low wage workers through Workfare.
Budget 2016: Does The Future Economy Have A Future?
A frigid job market and an uncompetitive business landscape hang like a sword of Damocles over Singapore’s future. Not surprising then, a survey done by the Government's feedback portal REACH (FULL) showed that the slowing economy and jobs were top among Singaporeans’ concerns ahead of the Budget to be held today.
Early this year, the Singapore Business Federation (SBF) staked its Budget wish on increasing the competitiveness of local businesses, such that they are able to set up shop overseas. SBF’s concern was that Singapore’s economy was too focused on attracting foreign investment.
This shift is in line with the Government's urge to transform Singapore’s economy from a value-adding one to a value-creating one, something Finance Minister Heng Swee Keat touched upon last year during the Semi-Centennial Leadership Conference, organised by the SBF.
Budget 2016: Singapore cut Transport Development Budget by S$1.58 billion
In the breakdown of the latest Budget 2016, the Singapore government cut the development expenditure of Transport by S$1.58 billion, or 15.3%, to S$8.76 billion in 2016. The budget cut contradicts the government’s commitment to improve public transport service especially with the increasing frequency of train breakdowns and overcrowding in public transport.
Another key expenditure that faced huge cuts is Culture, Community and Youth at 22.6% cut (S$589 million). The total expenditure for Economic Development were cut by 3.5% (S$559 million).
Two largest increases are the cost of government (Government Administration) which increased 17% (S$380 million) and health, at 18.95% increase (S$1.75 billion). The largest single component spending is Defence at S$13.96 billion, an increase of 6.4% over FY2015.
Budget 2016: The Super Simple Guide to Taking More Free Money from the Gahmen
If there’s 3 things to know about Budget 2016, this is it: gahmen is going to give more money to companies to help them grow, gahmen is going to give more money to the poor to help them eat, and gahmen is going to give money to your boss if you do charity.Simple right? Let’s look at this in a little bit more detail so you know how to get your hands on the gahmen’s money.
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