Coming in the wake of the White Paper on Population, this year’s Budget will be closely watched to see how it addresses the issues raised by the paper, which said that Singapore could have up to 6.9 million people residing here by 2030.

However, most financial institutions and analysts do not expect huge policy changes. Most see the Budget as signalling the Government’s commitment to achieve the broad strategies laid out in the paper.

One group which Deputy Prime Minister Tharman Shanmugaratnam may need to address in this afternoon’s Budget speech is the business community.

In recent months, almost every business organisation, especially those representing small- and medium-sized enterprises (SMEs), have come out to express in no uncertain terms their concerns about manpower constraints and limits on foreign workers, rising business costs and the push for greater productivity.

In particular, there have been calls for the Government to take a more calibrated approach in the restriction of foreign manpower. The Government, however, seems committed to its push to wean businesses off using cheap foreign labour to drive growth as it seeks to improve productivity.

And with many members of the public concerned about the influx of foreign workers following the publication of the White Paper, any relaxation of the current approach may be politically risky.

As PricewaterhouseCoopers (PWC) noted: “Many measures, such as the Productivity and Innovation Credit, have been introduced in recent years to help businesses improve their productivity. However, the feedback has been that these measures have benefited mainly multinationals and large corporations as SMEs, at whom the measures were mainly targeted, have found them to be too complex to understand and administer.”

Singapore Business Federation Chief Executive Ho Meng Kit recently said that he wished for “greater effort in terms of engagement and productivity improvement, greater resources put into productivity measures, simplification of schemes and broadening of the schemes so that more companies can make use of them.”

Indeed, with last week’s Economic Review of 2012 showing that productivity actually fell 2.6 per cent last year, the Government may want to do more to help businesses achieve its productivity growth target of 2 to 3 per cent. PWC suggests that a grant could be introduced to help SMEs defray the cost of seeking professional help to understand the various productivity measures available and plan to implement the necessary changes to their operations.

Companies may also get some relief to help them deal with the prevailing high business cost environment.

UOB analyst Francis Tan said in a report earlier this month: “The persistent rise in unit business costs from higher wages and rentals will continue to weigh on companies this year and there is a likelihood that the Budget will introduce another round of one-off cash grants for companies.”

Away from the business world, the Government may be tempted to do more to encourage more couples to have more babies. The White Paper highlighted the challenges arising from a low birth rate and, as PWC pointed out: “Fiscal ‘carrots’ (such as Baby Bonus, Parenthood Tax Rebate, Child Relief) do not appear to have been successful, so it may be time to consider addressing some of the more social factors which may be inhibiting the birth-rate.”

Its suggestions include introducing a COE rebate to make cars more affordable to Singaporeans with young families, a further reduction beyond the existing concessionary Foreign Domestic Worker Levy for families with more than one child, and a 150 per cent corporate tax deduction to reduce the cost of hiring temporary workers to cover those on maternity leave.

Elsewhere, UOB pointed out that “helping the lower income segment of the society is likely to remain on the top of the list as Singapore strives to be an inclusive society”.

While there are many ways of reaching out to the less well-off, some assistance on healthcare costs may be in the Government’s thinking, especially bearing in mind that last week’s Economic Review showed that those costs went up by 4.5 per cent last year.

Finally, it is worth noting that the Government’s coffers are sufficiently full to be able to introduce a range of measures addressing many issues: UOB is projecting an overall budget surplus of S$3.8 billion “as operating revenue is estimated to rise on higher corporate and personal income taxes arising from a more buoyant economic activity”.

Whilst no Budget will deliver what everyone wants, with a surplus of that size the Government has the kind of financial flexibility to ensure that it can deliver help and assistance to those parts of Singapore that most need it, be it the less well-off, potential parents, or the business community.