SINGAPORE - Workers' Party MP Sylvia Lim (Aljunied GRC) on Tuesday praised the "leftwards" shift in this year's Budget, which introduced more social safety nets and other measures to mitigate inequality in society.
She also welcomed the Government's decision to raise money for these measures by hiking income taxes on the rich and tapping on more contributions from state investment firm Temasek Holdings.
Ms Lim, the first opposition MP to speak during the Budget debate in Parliament, noted that Budget 2015 signalled a move away from the traditional emphasis on self-reliance towards more "collective responsibility".
"This Budget explicitly talks about strengthening social safety nets. This suggests a shift to the left, a direction which I believe is right," she said.
Stronger safety nets can encourage people to invest time in training or to take risks and become entrepreneurs, Ms Lim added. They will also help to reduce income and wealth inequality here.
She cited two key measures in this year's Budget: the SkillsFuture initiative for workers to continually upgrade their skills and the Silver Support Scheme that will give cash payouts to low-income elderly people.
SkillsFuture is not just about "upskilling the workforce" but also increasing social mobility, to help those who "may not have had the best school results to try to catch up and find a niche in Singapore," Ms Lim said.
Silver Support, meanwhile, functions as "a limited pension for up to 30 per cent of the elderly population", she added. She praised the scheme, saying it "comes as a surprise" because it marks a departure from the Government's past stance of not providing a "rights-based, defined-benefits welfare scheme".
But Ms Lim also saw Silver Support as a "worrying" acknowledgement by the Government that the Central Provident Fund system and family support are insufficient to provide retirement adequacy to about 30 per cent of Singapore's poorest elderly.
She called for a "broader review of policies to give seniors more peace of mind", including relaxing rules around the use of Medisave funds to let the elderly tap on these savings to pay outpatient treatment.
Another Budget move that will help to reduce income inequality is the decision to raise personal income taxes on the richest people here. The top tax rate will be hiked from 20 per cent to 22 per cent from 2017.
But Ms Lim thinks there is still room to raise taxes further for the wealthy, noting that Singapore's top marginal tax rate remains much lower than "the 40 to 50 per cent range" in many other countries.
Meanwhile, she lauded the Government's move to channel more of Temasek's investment returns to fund the Budget, saying: "Probably the Government has concluded that there is a better balance to be reached between locking up for the future and investing in the present."
