Reform Party’s Response to Budget 2011

The following is an excerpt of RP’s take on the Budget released by the government on February 18, 2011.

My Fellow Singaporeans,

Don’t you get the feeling that this is a government that lurches from day to day and has no long term plan?  That there is no one today who is the equal of Dr. Goh Keng Swee who was responsible for the master plan that put Singapore on the road to export-led growth in the 1960s.

This is a shameless electioneering budget laced with one-off payments to the electorate under the guise of not wanting to create entitlements. There is no pretence at putting in place long-term solutions to the problems faced by working Singaporeans.

But even amidst all the relentless hype about the one-time giveaways one salient fact stands out.  That is the smoke and mirrors over the Budget figures.  The Honourable Minister always manages to just balance the Budget or run a small deficit. However the balance is calculated by looking at operating revenue minus operating and development expenditure. Then there is a contribution from Temasek and GIC which may be much less than half their total profit. But interest and investment income on our enormous reserves is not added in.

If we do this then the basic government surplus is about $15 billion and not close to zero as claimed. This may not tell the whole story because it may not include the income from Temasek and GIC or the profits from land sales.

Surpluses of this size as a proportion of GDP have been the rule for over twenty years now. The Reform Party is not advocating giving back to the people the whole of the surplus for this year. However we say that we do need to have a rational debate as a nation as to what is the prudent level of reserves and what are our long-term needs.

The government’s attitude has always been that we are too childlike to make rational decisions and therefore the sweet jar must be hidden away on a high shelf out of our reach.

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