Singapore budget surplus growing despite vast social programme funding

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Ventures such as the SGD $8 billion Pioneer Generation package, and other measures designed to help older citizens of Singapore, were a big part of the yearly budget in Singapore last year. Taking this into consideration, along with other measures and the Net Investment Returns Contribution, the Government had predicted a deficit of approximately $1.3 billion or around 0.3% of GDP.
Ventures such as the SGD $8 billion Pioneer Generation package, and other measures designed to help older citizens of Singapore, were a big part of the yearly budget in Singapore last year. Taking this into consideration, along with other measures and the Net Investment Returns Contribution, the Government had predicted a deficit of approximately $1.3 billion or around 0.3% of GDP.

However, more recent estimate made by economists stated that the fiscal year 2014 could actually create a budget surplus. United Overseas Bank is also forecasting an overall budget surplus of S$390 million. DBS Bank is expecting a surplus of SGD $1.9 billion, and OCBC Bank at around S$1.3 billion.

‘The fiscal picture still looks fairly healthy as far as operating revenue is concerned, because the first nine months of FY2014, are still running at around 7% above trend,’ said the head of Treasury Research and Strategy at OCBC. ‘And that’s thanks to income taxes being stronger than expected, and GST being flat to modest growth in recent years.’

For the 2015 fiscal year, economists are expecting the government to continue committing a substantial amount of funds for social programmes. These are anticipated to include initiatives like the Skills Future Jubilee Fund to help Singaporeans build skills for the future, as well as the Silver Support Programme to assist elderly people in need.