Singapore's reserves were built up because the country's pioneering leaders were financially prudent, and the Government plans to continue in this vein, Senior Minister of State for Finance Indranee Rajah said yesterday.
She was addressing questions raised after Monday's Budget speech, in which Finance Minister Heng Swee Keat explained why Singapore will not spend more than 50 per cent of the expected returns from investing its reserves.
Quoting the Chinese saying that wealth does not last beyond three generations, Ms Indranee said: "Time and time again, experience has shown that the first generation accumulates... the second generation preserves and the third generation spends it."
But Singapore must be different, she said, adding: "The fourth generation of Singaporeans must continue to not only preserve but to grow the wealth that has been accumulated."
Speaking on the sidelines of a visit to Fei Yue Community Services in Choa Chu Kang, Ms Indranee said that it is necessary for the Government to explore borrowing to fund upcoming infrastructure projects - such as Changi Airport's Terminal 5, the Kuala Lumpur-Singapore High Speed Rail and the Tuas mega port - simply because they are so large.
Some spending is also "lumpy", with hefty upfront investments, she added.
These will be paid for by a mix of government funds, borrowing and, in some cases, private-sector funding as well.
VITAL TO GROW WEALTH
Time and time again, experience has shown that the first generation accumulates... the second generation preserves and the third generation spends it. The fourth generation of Singaporeans must continue to not only preserve but to grow the wealth that has been accumulated.
SENIOR MINISTER OF STATE FOR FINANCE INDRANEE RAJAH
"The question is what model of borrowing you have, and the right mix," Ms Indranee said.
She was reiterating points made at a post-Budget dialogue session held at the National Museum on Tuesday, where topics such as the upcoming goods and services tax hike were also discussed.
During her visit to Fei Yue, Ms Indranee observed activities to keep seniors active and plugged in to the community.
From April, the Ministry of So-cial and Family Development (MSF) will hand over most social support services for seniors to the Health Ministry.
These include senior activity centres, befriending services and counselling hotlines. However, senior group homes and sheltered homes will remain under MSF.
The move is necessary because health and social needs are so closely linked, Ms Indranee said, adding that it should lead to better coordination on the ground.
Said Ms Tan Su San, assistant director of Fei Yue Community Services: "We will be seeing a much more beneficiary-centric service with more coordination and more integration."