A change of focus - and what it means

With the Government set to register a healthy surplus of S$3.9bn in fiscal year 2012/2013 – primarily from increased stamp duty revenues in a red hot property market – Singapore must be the envy of fiscal authorities battling chronic deficits and high government debt.

Heeding calls from the populace for a greater share of the fiscal pie, the Government has rightly paid attention to the disadvantaged in our society and those who have not reaped the full benefits of our recent years of good economic growth.

Together with driving productivity to create better jobs for Singaporeans, promoting social mobility by giving a fair chance to all, and redistributing our nation’s wealth to benefit the lower and middle income groups, continues to rank high on the agenda.

The recent pro-family measures have, arguably, taken care of our young families, so the spotlight of this Budget is squarely on the other vulnerable groups in our society. The lower wage and elderly workers justifiably get a leg up with top-ups to their Medisave accounts and other financial assistance measures, as the calls to help these groups were strong and loud in the lead up to the Budget.

In what could be a harbinger of future policy stance (for the foreseeable years to come), there was no new measure introduced to entice the rich foreigner or new businesses to set up camp in Singapore.

While this year’s measures will likely reap political goodwill for the Government, it is important to bear in mind that in this time of mobile capital and labour, fiscal policies must be continually tailored and relevant in order for Singapore to stay on the radar screens of global investors.

One would not be able to ignore the net economic benefits that investments can bring.

Tan Tay Lek is a Partner at PricewaterhouseCoopers Services LLP.