Parliament approves $109b Budget after vigorous debate impacted by virus surge, Ukraine war

Some of the hotly debated topics included the upcoming GST rate increase and measures on foreign manpower. ST PHOTO: CHONG JUN LIANG

SINGAPORE - The Covid-19 virus did not discriminate as MPs from both sides of the House were infected in the last two weeks, yet the Budget debates were vigorous, said Leader of the House Indranee Rajah on Friday (March 11).

In a speech capping two weeks of debate, Ms Indranee also noted that just as the debates began, "the world changed with the situation in Ukraine".

It reminded everyone that independence, the right to self-determination and territorial sovereignty are precious and cannot be taken for granted, she said.

It also showed "why small countries like Singapore must continue to advocate and uphold an international order that is rules-based and principled," she added.

Ms Indranee, who is also Second Minister for Finance and National Development, added that against this backdrop, the House debated and approved one of Singapore's most transformative Budgets to date, "setting ourselves on a path towards becoming a fairer, greener, more inclusive, and overall more progressive Singapore".

Parliament approved the Government's $109 billion spending plans for the coming financial year after over 73 hours of debate, where 66 MPs spoke on the Budget statement itself, and 639 cuts - short speeches - were filed in the debate on the ministries' budgets.

Some of the hotly debated topics included the upcoming goods and services tax rate increase, as well as the measures on foreign manpower.

This is the highest level of participation in the last five years, despite the reduced numbers of MPs able to attend Parliament, said Ms Indranee.

She, along with Minister of State for Trade and Industry Alvin Tan, People's Action Party (PAP) backbenchers Carrie Tan, Gan Thiam Poh, Cheng Li Hui and Alex Yam, as well as Workers' Party (WP) MPs Sylvia Lim and He Ting Ru, and Nominated MP Hoon Hian Teck, was among those who had caught the virus and missed part of the debate.

The minister thanked her parliamentary colleagues for their care and concern and support for those who are ill, quipping: "Let me especially thank Mr Louis Ng (Nee Soon GRC), who gave the most encouragement and support primarily because he wanted me to get well in time to answer his parliamentary question."

Ms Indranee also noted the value of robust debate, but said that it is "also important that members maintain decorum in their actions both in and outside of the House".

"The Standing Orders are there for a reason. Timelines and deadlines are also there for a reason to enable us to conduct parliamentary business efficiently but also effectively," she said, urging members to be mindful of what she had just said.

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Earlier in the week, Non-Constituency MP Leong Mun Wai from the Progress Singapore Party had apologised, after being requested to do so, for claiming that he had been prevented from asking his questions during the debate by Speaker of Parliament Tan Chuan-Jin.

Ms Indranee also reiterated the Government's stance towards the GST hike - it is fair and progressive and will not hurt the low-income because of the permanent GST Voucher scheme, while the rest of Singaporeans will also benefit from the $6.6 billion Assurance Package.

She said: "Those with less also contribute, but a lesser amount and receive more in return, keeping the tax burden manageable for all, including businesses so that there is incentive for all to work hard, do well and enjoy the benefits of the hard work even as they contribute to our revenues.

"We still maintain the protection of our reserves and we use the income on our reserves equitably - 50 per cent for this generation, 50 per cent for the next."

The WP has a different philosophical approach, she added. All its MPs had objected to the GST increase, and had proposed instead to tax the rich, tax large companies or to use more of the reserves.

"But I don't think there's any dispute that there is a genuine and real need though, to fund healthcare going forward and that there is a need for increased revenue to achieve additional revenue of $3.5 billion a year," said Ms Indranee.

From the Government's perspective, it is too early to adjust corporate tax as it will depend on evolving rules such as BEPS 2.0 - a framework for the reform of international tax rules - and may also result in talent and wealth being driven away, she said.

She added: "In reality, wealth is mobile. Higher taxes on a small group of people at the top, who are extremely mobile, will eventually lead to higher taxes for upper middle-income or even middle-income groups."

Using more of the reserves also means higher taxes for the next generation, she said.

"When all was said and done and the dust settled after the debate, it's good just to crystallise the two different positions so that people will have a more meaningful insight as to what the different propositions actually mean," said Ms Indranee.

In his round-up speech, Speaker Tan Chuan-Jin said people may complain that the Government's communications are complicated, but the reality is "when you're in the business of making things work... the details do matter".

He said: "It is not quite so straightforward. You can't just virtue signal, you can't just bandy about ideas, it is very different when you have to carry them out".

He added that it is easy to critique - and important to do so - but bearing the responsibility of translating ideas, views and opinions into reality is very different.

Mr Tan also touched on the scourge of disinformation that was blighting politics in other societies in a post-truth world, saying: "These days, truth might seem indeterminate, malleable, after all who determines the truth?"

Stories can be used to illustrate gaps and concerns to formulate better policies, but they can also be false, half-true, or used out of context, he said, adding that these stories and their subsequent claims can result in real implications.

"The important question, I guess, for all of us as leaders in this Parliament, in this environment, is to realise that this playbook, sadly, actually works. Which is why you see many politicians using it. The rise of the far-right or the far-left are examples of that," he said.

"Race and religion is an easy game to play because it is so primordial in every society. Do we play fast and loose with the stories we use? Do we just lift 'facts' from chat groups, or wherever it might be? Do we use anecdotes recounted to us without checking whether it is true?"

Mr Tan then spoke of the importance of Singapore's reserves. The debate saw several calls from the opposition benches to tap the reserves a bit more, among others, as an alternative to raising the GST. 

He said the policy decisions the Government had taken were not easy ones, nor were they the most politically expedient.

"The easiest path to take for any government of the day is to spend and keep your electorate happy. In my view, it is completely politically naive and stupid to talk about balanced budget, to talk about tax increases, when you have reserves," he said.

Should the need arise in the coming years, he said he had no doubt the Ministry of Finance would step in and do what needs to be done - but it is only able to do so because of the reserves available.

He added: "We can be confident that we have the wherewithal to look after our people and to look after our people well, today and for tomorrow."

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