‘Spirit of caring, enterprise’ to propel S’pore into the future

SINGAPORE — The raft of initiatives rolled out under Budget 2016 would help the country take its first steps towards a future where the economy is abuzz with innovation and enterprise, and a society alive with caring and resilience.

And with the country on the cusp of what Finance Minister Heng Swee Keat described yesterday as a long journey, Singaporeans must also not lose sight of the present and be blindsided by what is coming up on the horizon. At the same time, they need to look out for one another along the way.

While the Government has a part to play, it must recognise “when to step in, and when to step back”, Mr Heng told Parliament as he wrapped up three days of Budget debate. “We must not inadvertently undermine the spirit of enterprise and the natural workings of markets, or undermine the spirit of caring and resilience such that we weaken the bonds of family and community,” he said.

Echoing a common refrain among MPs on the need for fiscal prudence, he added: “We have to budget for our journey. We can’t use up all our supplies at the start, and we have to have ways to grow our store of supplies.”

In all, 53 Members of Parliament (MPs) took part in the debate, following the Budget speech delivered by Mr Heng on March 24. The MPs raised a range of topics including the economy and jobs, as well as social support for the elderly and those with low income.

The centrepiece of the S$73.4 billion Budget was a S$4.5 billion Industry Transformation Programme to help companies grow capabilities and expand overseas, as well as tap on automation and technology. And Mr Heng noted that many MPs had spoken in support of homegrown small and medium enterprises (SMEs). Noting that this year’s Budget was “tilted to support SMEs”, Mr Heng pointed out that there are over 180,000 such firms here, accounting for nearly two-thirds of employment. “The success of our SMEs matter to our people’s jobs and well-being,” he said.

However, he stressed that nurturing a spirit of enterprise among companies would mean avoiding an over-reliance on the Government.

Borrowing an analogy from Singapore Precision Engineering and Technology Association advisor Steven Koh, Mr Heng said: “Government support is like push-starting a car that has gotten stuck in a difficult patch: It can get the car going again (but) once the car is moving, it has to rely on its own engine to go the distance.”

Singapore firms need to “look outward and look forward” in order to find new markets, grow capabilities and transform. Having a spirit of enterprise means to “not be held back by what appear to be limitations, to overcome challenges, innovate, and seize opportunities”, Mr Heng said.

Stressing the need for long-term vitality and not short-term fixes, Mr Heng also noted that this year’s Budget was “carefully calibrated to address cyclical concerns without impeding restructuring”.

While acknowledging that costs remain a concern for many SMEs, he pointed out that rental costs have declined over 2015. Retail, office and industrial rents fell by 4.1 per cent, 6.5 per cent and 2.1 per cent respectively. Nevertheless, he noted that firms’ experiences could differ.

The rising wages, albeit good for workers, put pressure on businesses, Mr Heng said. But he pointed out that cost pressures on businesses are fundamentally based on supply and demand. “Our supply of land and labour is limited. But the demand for our resources is growing, which in fact indicates that our economy is still growing.”

Adding that Singapore has to accept that it cannot be a low-cost location, he stressed that the Government cannot permanently subsidise business costs. “All firms … must compete on productivity and innovation. This is the only way to reinforce the spirit of enterprise and to build vitality in our firms”, said Mr Heng.

During the Budget debate, MPs including Mr Liang Eng Hwa (Holland-Bukit Timah GRC), Mr Chong Kee Hiong (Bishan-Toa Payoh GRC), Ms Foo Mee Har (West Coast GRC) and Mr Henry Kwek (Nee Soon GRC) had spoken on the importance of fiscal sustainability even as the Government addresses the economic and social challenges.

In the coming years, spending on healthcare, infrastructure and defence will go up even as revenue growth slows amid a maturing economy. To ensure spending needs are met and avoid imposing a growing burden on future generations, Singapore must build a vibrant economy and grow its revenues, said Mr Heng. It also needs to spend prudently and design a fair and progressive overall fiscal system, he added.

Adding that it is impossible for the Government to “keep handing out goodies to everyone, year after year”, Mr Heng said Singaporeans “should not be evaluating budget measures solely from the individual’s perspective, which would be narrowly focused on the individual winners and losers”.

“Instead, our larger goal is to make every Singaporean a winner in the long run ... When we help one group, we are actually helping others too,” he said.

By investing in the young, for example, the Government is helping them to have the means to support their loved ones in retirement. And when tax burden is kept low, especially for those with middle income, everyone benefits, Mr Heng said.

Calling on Singaporeans to “look out and care for one another” as the country moves into uncharted territory, filled not just with challenges but victories, Mr Heng concluded: “The purpose of this journey is to journey together, and to reach our destination together, as one united, cohesive people.”