Non-Constituency Member of Parliament (NCMP) Hazel Poa from the Progress Singapore Party (PSP) has urged the Government for greater transparency on the National Reserves so Members of the Parliament (MPs) can make informed decisions when voting for a Budget.
In her budget speech delivered in Parliament on Wednesday (24 February), she also noted that knowing the amount in Reserves will also allow Singaporeans to have a better understanding of the rationale behind some “difficult decisions” like the need to raise the GST to 9 percent in the future.
Referring to Deputy Prime Minister Heng Swee Keat’s budget statement, she said Singapore can expect a budget deficit of S$11 billion, attributed to the COVID-19 Resilience Package.
However, she asked how anyone would know if S$11 billion is a “prudent budget deficit figure” given that National Reserves remain a national secret.
Since MPs are also not aware of the amount in reserves, it will be hard for them to make sound decisions when they vote on a Budget that would require a draw down, she noted.
“While I do not yet know the answer to that question, I do know that Members of Parliament are being asked to vote on a Budget that would require a draw down on our reserves without knowing its size. Without knowing our nation’s financial position, it would be difficult to make sound and prudent decisions, and certainly not informed ones.
“So again, I ask that more transparency with regards to the National Reserves be made, if not only that Singaporeans better understand the rationale for difficult decisions like the need to raise the GST to 9% in the future,” she said.
If that’s not all, she also asked if President Halimah Yacob is aware of the exact size of the reserves when she made decisions on its drawdown, given that it is the President’s responsibility in safeguarding the National Reserves.
MOF to give fuller accounting on benefits of budget measures
In 2020, the Government committed close to S$100 billion via different packages to help Singaporeans and the economy through the COVID-19 pandemic.
As such, she asked the Ministry of Finance (MOF) to provide a fuller accounting on the benefits of budget measures, as well as an assessment to know if the resources were used effectively and efficiently.
To provide an example, she quoted that the Monetary Authority of Singapore (MAS) estimated that the five budgets from last year created or saved 155,000 jobs. However, if the Government were to pay a monthly salary of S$4,000 to these 155,000 individuals, this will amount to only S$7.4 billion.
“MAS also estimated that the measures saved or created 155,000 jobs. To put the numbers in perspective, if we were to pay 155,000 people $4,000 per month, it would cost us $7.4bn per year. $100bn is sufficient for 13.4 years of payment.
“Can MOF give a fuller accounting of the benefits of the budget measures and an assessment of whether those resources have been used effectively and efficiently?” she asked.
“$100bn is not a small amount. We ask for a cost benefit analysis of each scheme put in place. We recognise that it is not easy coming up with measures within a short timeframe to deal with a pandemic. So we ask not for a perfect solution, but an honest and transparent assessment and review.”
As such, she pointed out that measuring the effectiveness of all the measures will help the Government make better allocations in the future, adding that the Government can do more in helping households and SMEs.
“I believe that the latest $900 million allocated to help Singapore households ride out the COVID-19 crisis is inadequate. With more business closures and unemployment expected to increase after March when many of the support measures start to taper off, more households will likely suffer financial stress. I hope the Government will consider increasing its support for the many who will likely need it,” she said.
She continued, “Singapore has a small domestic market so SMEs need help to grow and develop into a size that will enable them to compete globally. While the budget has addressed the capital needs for Singapore businesses, the government can do more.”
Suggestion on growing the economy
In her speech, the PSP member also suggested that a target for the wage component of Singapore’s GDP should be set, which should at least be 50 percent of GDP. This is to ensure that the people can enjoy the fruits of Singapore’s economic development.
“In his Budget Statement, DPM stressed that the focus on growing the economy is to benefit the people. To this end, PSP would like to suggest that the Government set a target for the wage component of our GDP to ensure that the fruits of economic development are enjoyed by its people.
“If we want to ensure that our people enjoy the benefits of this economic growth, we should set an initial target of having the wage component form at least 50% of GDP. This should be an important KPI for the government moving forward,” she expressed.
Nevertheless, Ms Poa noted that she supported the Budget.