SINGAPORE - A budget that stays the course, and continues the government's twin goals of restructuring the economy to raise productivity while fostering greater social inclusion: that is the view of most analysts on this year's budget by newly minted finance minister Heng Swee Keat.
Dr Paulin Straughan. National University of Singapore sociologist and former Nominated MP:
This is a people-oriented budget, even with the strong focus on the economy and ensuring that it remains vibrant, there is much investment in our children and our human capital.
The new KidStart scheme and the premium it places on lifting a child out of disadvantaged social circumstance s is very progressive as it is targeted at children from one to six years old, an age group that is often neglected because there is no demonstrable outcome, no goal posts to pass compared to when they are older. I look forward to more details, such as on how the government will identify these children.
That enhancements to the Workfare Income Supplement come alongside an expansion to the Workfare Training Support scheme sends a signal that while it is expanding social support, we are not a welfare state. The government always tries toattach a skills enhancement component to its schemes, and shows a commitment in investing in human capital.
That's the whole point of this year's budget: while there is greater focus on the economy compared to last year, which was really a budget that looked at the social well-being of Singaporeans, when you look at the investments to support the economy this year, most of the measures send a strong signal that it can't be business as usual, and there is an urgent need to rethink the way we do business, and to transform the economy.
Ms Boey Yoke Ping, Baker Tilly TFW Head of Tax :
Budget 2016 presented today is a steady start for Singapore's next phase of growth, amidst an economic environment that remains fraught with uncertainty and global economic headwinds.
Unlike the SG50 Budget, expectations were relatively modest this time round and the budget presented by the new Finance Minister, Mr Heng Swee Keat, held few surprises. Among these are the SME Working Capital Loan Scheme in which the government will co-share 50 per cent of the default risk of such loans, to encourage banks to lend to SMEs.
Many of our SME clients have said that access to financing has been the major hurdle for expansion and internationalisation. This new scheme, for loans up to $300,000 per SME would give a boost to this large sector of the economy.
As expected, there is a continued focus on measures meant to spur innovation.
Mrs. Chung-Sim Siew Moon, Head of Tax Services, Ernst & Young Solutions LLP says:
A comprehensive and all-encompassing Budget with transformation of enterprises and industries through innovation taking centre stage, the Budget measures send a very strong message that the Government is here to help.
Not only does the Budget provides near term measures to tide over the current economic slowdown, it also introduces measures for the next stage of development, like the New Industry Transformation Programme.
The Business Grants Portal for grant application and the National Trade Platform point towards the government's efforts to ease the cost of doing businesses.
Ms. Kerrie Chang, Partner for People Advisory Services (Mobility), Ernst & Young Solutions LLP :
Notably absent this year is the announcement of any one-off personal tax rebates to reduce the tax cost of all resident taxpayers. This must be disappointing for taxpayers especially in light of continuing challenges with high costs of living and amidst a slowing economy.
The cap on personal reliefs will impact high-wage working mothers with dependent children. This may disincentivise various voluntary contributions, such as CPF top-ups to set aside money for retirement needs either for themselves or for family members. For reliefs that can be shared by spouses, for example Qualifying Child Relief, taxpayers will need to better plan so that they can maximise the tax savings."
Mr Tham Sai Choy, Chairman of KPMG's Asia Pacific Region and Managing Partner, KPMG in Singapore:
The continued emphasis on innovation in this year's Budget helps to prepare Singapore for the future. As other countries also move up the value chain, having an efficient and educated workforce, with their capabilities harnessed through enterprises with strong market positions, will enable Singapore's economy to stay competitive and relevant in a globalised world.
Mr Chiu Wu Hong, Head of Enterprise at KPMG in Singapore:
This year's Budget focuses on two broad groups - the small-medium enterprises (SMEs) and the people. It highlights the importance of a concerted partnership between enterprises, trade associations and chambers (TACs), government agencies, and unions. This provides continuous support for our people to manage a weaker and challenging economy.
This is a Budget for the small-medium enterprises (SMEs). It addresses their short term measures and helps them to continue structuring and growing domestically and also compete internationally. SMEs need to transform themselves in the way they operate, automate and collaborate with an industry centric approach.
It is heartening to see that the Budget adopts a more sector focused approach with calibrated measures to help the different needs and challenges faced by small-medium enterprises (SMEs).
Dr Walter Theseira, labour economist and senior lecturer at SIM University:
A lot of what was announced in this year's Budget is a continuation of policies set forth in previous budgets, such as specifics on how the Silver Support Scheme will be implemented.
That the Workfare Income Supplement payments will now be made monthly instead of quarterly will help to balance income and expenses for low-income households, since the issue with quarterly payments previously was that the unfortunate reality was some households without savings went into arrears and had to take high-cost loans between payments.
The three year extension to the Special Employment Credit (SEC) is also important as statistics show the increase in labour force participation for older workers in the past few years has been quite significant, and we don't want to risk that changing given that Singaporeans are going to live longer than ever before, and without jobs they are going to have a lower standard of living.
So it's largely staying the course with no significant departures, and continues the objectives we saw in previous budgets to try and restructure economy while boosting social inclusion.
Dr Vivienne Wee, Research and Advocacy Director at Association of Women for Action and Research AWARE:
This year's budget took limited, tentative steps to a more "caring and resilient society", but missed an opportunity to be bolder and more robust in supporting care and promoting equality. Singapore urgently needs to prioritise investment in care infrastructure, instead of relying on unpaid female family members leaving the workforce.
Disappointingly, the Minister did not address this, even though care support allowing women to return to work would alleviate the labour shortage that he mentioned a few times. The focus in this year's Budget on skills acquisition and lifelong learning unfortunately continues to overlook this vital point.
AWARE also seeks clarification on the newly announced Child Development Account (CDA) First Step grant. The Budget speech and media releases refer to "all" Singapore citizen babies, but marriage of the parents has ordinarily been one of the eligibility criteria for CDAs.