Singapore Budget 2018: Slight Budget deficit on the cards for FY2018

The Home Affairs Ministry's outlay will go towards beefing up the police force's existing capabilities.
The Home Affairs Ministry's outlay will go towards beefing up the police force's existing capabilities.PHOTO: LIN ZHAOWEI FOR THE STRAITS TIMES

A Budget deficit of $600 million, or 0.1 per cent of gross domestic product (GDP), is expected for the 2018 financial year, while expenditure is expected to rise.

Ministries are expected to spend $80.02 billion, or 8.3 per cent more year on year than in 2017, mainly on the back of increased outlays in transport, trade and industry, and domestic security.

In particular, transport spending will jump by over 50 per cent to $13.7 billion, while expenditure for home affairs is expected to rise from $5.8 billion to $6.5 billion.

The higher expenditure at the Transport Ministry will come from projects such as the Kuala Lumpur-Singapore High Speed Rail, the Johor Baru-Singapore Rapid Transit System Link, and funding for the renewal of domestic rail operating assets as well as public bus services contracts. This will make transport the second-largest area of spending after defence ($14.8 billion).

The Home Affairs Ministry's outlay will be channelled towards beefing up the police force's existing capabilities, as well as developing new skills amid increased terrorist threats.

On the other hand, health spending is projected to ease from $10.5 billion to $10.2 billion, owing to lower development expenditure as certain construction projects near completion.

Operating revenue for 2018 is projected at $72.68 billion, a 3.3 per cent decrease from the revised estimate for 2017. This will come on the back of lower revenue from statutory board contributions, stamp duty and vehicle quota premiums.

 
 
 

There was an exceptional statutory board contribution from the Monetary Authority of Singapore in 2017, as well as a jump in stamp duty collections. Both are seen as one-off events.

Top-ups to endowments and trust funds will jump from $4.01 billion to $7.3 billion, partly due to the $5 billion injection into the new Rail Infrastructure Fund. In addition, the GST Voucher Fund is being topped up by $2 billion to support payouts under the voucher scheme.

Net investment returns contribution is projected to come in at $15.85 billion, or 8.5 per cent higher than the revised figure for 2017.

 
A version of this article appeared in the print edition of The Straits Times on February 20, 2018, with the headline 'Slight Budget deficit on the cards for FY2018'. Print Edition | Subscribe