While the economic challenge caused by the coronavirus outbreak is very grave, the Government will do "whatever it takes" to stabilise the economy, preserve jobs and help companies stay afloat, Prime Minister Lee Hsien Loong said yesterday.
"We want to see people through this; we are under no illusions that this is the end of the story because nobody can tell what lies ahead," PM Lee said at the Istana as he spoke on the $48.4 billion supplementary budget that Deputy Prime Minister Heng Swee Keat unveiled on Thursday.
The country yesterday reported 49 new coronavirus cases, taking the total to 732, including a new cluster of three at SingPost Centre in Eunos.
Giving a sense of the fast-changing situation, PM Lee said the Government had thought the measures contained in the Budget presented on Feb 18 would buy a few months of time for it to assess the situation and put together a second package.
"But we did not expect within one month, the picture was totally changed - the health picture was totally changed, the economic picture was totally changed," he said.
This is why the Government also completely changed its policy response and set aside a further $48.4 billion to support businesses, workers and families - a supplementary budget that is more than seven times the initial $6.4 billion worth of measures to cushion the Covid-19 fallout.
While the combined $55 billion to combat the coronavirus is intended to see the country through the end of the year, Singaporeans must brace themselves for things to worsen in the coming months, said PM Lee.
In such a scenario, the Government is prepared to tap the reserves again. "We have the dry powder," he said. "If we need to do more, when we need to do more, we will do that down the road."
PM Lee noted that economies around the world have been drastically hit and, as an open economy, Singapore has been particularly affected by the flow of goods and people reaching a standstill.
"It is going to last quite a long time: It is not a V-shaped down dip, it is not a U-shaped dip," he warned.
"If you are lucky, you can sustain it at a diminished level for quite a long time; if you are not lucky, it will keep on going down, and some pieces (of the economy) are going to have a lot of difficulty, just staying in existence."
The Government's aim is very clear, he said - to protect jobs and help companies stay in business by reducing their costs. Key industries like aviation will be helped so they can "continue in semi-suspended animation, but able to come back to life when the opportunities come".
"There will be ups and downs," he said. "Therefore, it is critical that we go into this eyes open, (with) strong leadership, good government, united and determined to see this through."
On the next general election, PM Lee said the slim odds of the situation improving in the next few months mean he has to decide whether to call polls "under abnormal circumstances".
"It is a very difficult decision because we are going into a very big storm and you want to have the strongest team and mandate, and the longest runway so that Singapore can have the best leadership to see it through this storm," he said.
"That is a very desirable - and in fact an essential - requirement for us to see through this together."
The Internet and social media mean communications can still flow even though large-scale gatherings have been curtailed, he added. Israel held its own elections recently, despite the outbreak.
PM Lee said he would decide once procedures are in place, including electoral rolls being certified and republished.
"Once that is done, that means all possibilities are there," he said. "I will have to judge the situation."
