In its Budget next year, the Government will partner and support Singaporeans, transform the country's industries and workforce, as well as ensure environmental and financial sustainability.
Second Minister for Finance Indranee Rajah gave this broad summary of the strategies for Budget 2020 yesterday during a pre-Budget dialogue held at the Asian Civilisations Museum.
Addressing 120 members of the public, she said the Budget reflects Singapore's values and priorities, and the Government wants to craft it in partnership with Singaporeans.
On the economic front, the priority is to help businesses innovate, go regional and build capabilities, she said, adding that workers should upskill and reskill to seize new opportunities and good jobs.
Noting that local firms are at different stages of growth, Ms Indranee stressed the need to provide the correct type and level of support to help firms with their ambitions to transform and strengthen their capabilities.
She also encouraged more workers to take advantage of the SkillsFuture movement and the Adapt and Grow initiative, designed to help Singaporeans affected by the economic downturn and restructuring.
There will also be measures to support young families, and ensure quality and affordable housing and good caregiving arrangements, she said, adding that annual spending of $840 million on the pre-school sector will more than double in the years ahead.
She also acknowledged concerns about the cost of living, and said the Government is considering how to best support Singaporeans during this period of economic uncertainty.
"We welcome suggestions from the public on what forms of support might be useful and sustainable," she said.
On climate change, she said more immediate plans to tackle the threat will be unveiled in Budget 2020. But besides environmental sustainability, the Government also has to ensure financial sustainability, she added.
That is why the goods and services tax will have to be raised from 7 per cent to 9 per cent some time between 2021 and 2025, she said.
The major reason for this is that one in four Singaporeans will be aged 65 and above by 2030, and their healthcare needs will spike.
RISING SPENDING NEEDS
Over the past decade, government expenditure has more than doubled. While our operating revenue has also grown, it is still outstripped by our growing spending needs.
SECOND MINISTER FOR FINANCE INDRANEE RAJAH
Spending on pre-school and early childhood education as well as security will also rise.
"Over the past decade, government expenditure has more than doubled. While our operating revenue has also grown, it is still outstripped by our growing spending needs," she said.
The GST hike will allow the Government to meet recurrent spending needs in healthcare, pre-school education and security, she added.
She also gave the assurance that the Government will roll out an "offset package" to ease the impact of the hike, the details of which will be announced during Budget 2020.
In an interview with local media last week, Prime Minister Lee Hsien Loong said the next Budget will be "strong and suitable to the state of the world and what the Singapore economy needs".
Last night, Ms Indranee told participants present that Singapore's fundamentals remain strong.
Despite economic headwinds which have dampened growth, the Republic continues to attract good companies and investments, has a stable and pro-business environment, progressive regulations and a skilled workforce. These allow it to remain nimble and seize opportunities, she said.
Singaporeans must do as they have always done, which is to navigate their way "skilfully and carefully, and choose the paths that will lead us to growth, prosperity and assurance for the future", she said.
"We must not turn inward and be insular. We must also guard against polarisation and instead work together as a team to harness our collective strength and abilities to address these challenges."
Dialogue participant Chia Zheng Wen, 33, a marketing executive, said he looks forward to more subsidies and grants to spur innovation among local small and medium-sized enterprises (SMEs).
"Many SMEs are repeating the same (way of doing) things from years ago and this is not healthy. There is a real need for local companies to innovate to stay ahead of the competition," he said.
As part of the pre-Budget consultation process, members of the public can give their views through the Singapore Budget website, as well as government feedback arm Reach's social media channels and feedback form.