It is natural for public interest to gravitate towards tax rebates, grants or new levies during the Budget season. However, attention must also be given to the broader mission of the annual exercise: namely, to ensure that Singaporeans are placed in a fiscally sustainable and secure position over the long term. If immediate demands alone predominate year after year, two worrying outcomes might result. First, the system of managing financial resources could degenerate; and second, short-term gratification could lead to problems and costs being kicked like the proverbial can down the road. Both warrant close examination.
Fiscal planning inevitably involves the nation's substantial reserves, given the fact that the net investment returns have now grown to become the largest contributor to revenues. This makes the reserves vulnerable to decisions taken for the sake of political expediency, especially when the current expectations of groups of voters loom large during the course of an electoral cycle.