Budget surplus, yes, but saving for future is crucial

Budget surplus, yes, but saving for future is crucial
PM: Focus on instant handouts over long-term growth 'dangerous'
By Zakir Hussain

PRIME Minister Lee Hsien Loong has described as 'dangerous' the view that Singapore is now rich enough for the Government to dish out hongbao freely.

In his first comments on this year's Budget, he warned that if the country stopped saving and investing for the future, economic growth would also grind to a halt and 'we would be in serious trouble'.

Mr Lee said he had noticed that when people discussed the Budget, passed by Parliament last Thursday, the emphasis was on its immediate handouts.

There was much less focus on its longer-term investments to help Singapore grow and prepare for future challenges.

Many seemed interested mainly in 'what more should the Government give? Who else to give to? Who should get more?' he said.

He warned against such an attitude:
'The assumption which some people have is - we are now rich, we can afford to spend more. This is a very dangerous way of thinking and worries me a lot.'

Singapore is where it is today, he said, 'because we have saved, we have been frugal, because we haven't just thrown money away'.

'If now we change our mindset, and say we used to save, now that we have money we don't need to save anymore, then the growth will stop. Singapore will go down, and we will all be in serious trouble,' he added.

This year's Budget included a $1.8 billion surplus sharing package of income tax rebates, growth dividends and top ups to Medisave to help people cope with the rising cost of living.

But some members of the public and their elected representatives in Parliament called for yet more relief to help individuals and businesses cope with rising costs, in light of the bumper $6.45 billion surplus for the last financial year.

On Friday, at the launch of a new Anchorvale community club in Sengkang, Mr Lee assured Singaporeans that as the economy grows and the resources at the Government's disposal increase, it will strengthen the social safety nets and set aside more to support needy and low-income families.

Singapore Property - Buy, Sell, Rent, Invest
Jerry Hansin (+65)9027 5537
email: jerry@assetomgt.com
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