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Goodies seen for SG50, election year

But Govt may also make off-Budget changes when needed, say analysts

Many market watchers reckon that next week's Budget will be the last before the General Election is called.

And even if a GE isn't held this year, many Singaporeans hope that some Jubilee Budget goodies will come their way.

"These measures could be similar to what we saw from Budget 2011, which was delivered before the May 2011 GE," said Barclays economist Leong Wai Ho.

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Popular "growth dividends" in the form of cash were announced in the last two election-year Budgets, in 2011 and 2006.

But wealth transfers do not necessarily have to be delivered in the Budgets as the Government can unveil one-off measures when circumstances change.

Credit Suisse economist Michael Wan noted: "Several elections have coincided with periods of economic stress, in 1997 and 2001, for example."

While generous tax rebates were unveiled in the 2001 Budget, the real surprise came when the economy slipped into recession a few months later.

That October, just weeks before the Nov 1 polling day, a round of off-budget measures worth $11.3 billion was announced.

This year, economists have warned that the uncertain global economic outlook might also make the Government more sparing with one-off handouts.

Meanwhile, the softening property market has many home owners hoping for a lift, but Mr Wan doubts that the Government will unwind cooling measures "at a time when we have not got clarity on the timing and pace of the United States federal funds rate hikes".

That said, Credit Suisse analyst Yvonne Voon sees some opportunities for the "fine-tuning" of certain "pressure points", such as the Qualifying Certificate for developers and the Additional Buyer's Stamp Duty for citizens in the Budget.

Citibank economist Kit Wei Zheng is predicting that an early election will be held in the second half of the year, "riding on disinflation that has historically been associated with higher share of the popular vote for the PAP (People's Action Party)".

This implies more generous spending will be budgeted, said Mr Kit in a research note.

marilee@sph.com.sg