The Plain Vanilla Budget

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PEOPLE make fun of vanilla, but it’s an extremely versatile and enduring flavour. When everything looks colourful and there are too many decisions to be made, vanilla is the faithful fallback flavour.

So it was that Budget 2017 took the safe route of vanilla ice-cream. The theme was Moving Forward Together, but the reaction to it, has been pulling in different directions.

In between the few handouts that would benefit some pockets of society — cheaper resale flats, less income tax, help in businesses going global, what did come across as heavy-hitting was the promise of the 30% increase in the price of water. Something that affects everyone.

There will never be a perfect budget. It’s often a case of how less imperfect we can make it. In times of challenge and turmoil, it’s never easy to balance things.

Every year, people hope in anticipation that this will be their year to benefit from the budget. Small and medium enterprises (SMEs) waited, but wound up short. Lena Soh-Ng, whose public relations firm, Huntington Communications has a number of clients in this category felt the 2017 Budget “was short on booster shots for the SMEs”. It impacts her directly since it results in “a fallout for our clients in these sectors”.

“Even as we embrace future economy industries, the transition time to those industries cannot be achieved in one year.”

Here are the views of a cross-section of society.

Joel Chang, Investor

“I think it is still very much a reactive budget like recent ones, to ‘patch up’ problems in our economy rather than offer more meaningful long-term solutions.

The government’s co-investment in overseas private enterprise forays and an expansion of the skills future initiative are the two bright sparks, but I hope they are not too late.

How many times can you flog this dead horse of “subsidies”? Singaporeans are not beggars. We are a proud and hardworking people. Subsidies should be focused on groups that cannot help themselves like the elderly or disabled.

GST credits and tax rebates should be given out only to the very low or no income with the rest of this budget focused on strengthening the healthcare and housing social net for these same fringe groups.

The government says we should not be governed like a welfare state but the continued use of such broad income redistribution at best works like a poor man’s temporary version of a welfare state.

Invest In Infrastructure

Propping up our construction industry continues to be the main focus of fiscal spending. Is it because this directly transfers fiscal expenditure to GDP? How many Singapore jobs does this industry relatively contribute? We should be investing in infrastructure and spending more on Singapore centric technological projects that will generate more quality jobs for Singaporeans well into the future!

The time is ripe for Singapore to lead Southeast Asia with new green industries and technology economies leading to high-quality jobs and global enterprises if we only support companies to take the green initiative.

Our budget ‘surplus’ is addicted to ‘investment returns’. To the uninitiated, this appears to be a great display in investment capabilities of our custodians. However the truth is that the main contributors to these ‘investment returns’ are our government-linked companies (GLCs), mostly operating in state-sanctioned, monopolised industries. I continue to champion privatisation of these ‘protected’ industries in order to develop more home grown private enterprises that rely on a strong domestic base to excel on a global stage.

Chandran V.R., Entrepreneur

Quite frankly I am worried to see when our economy is growing less than 2% a year, but the rise in public car park rates is up by 20% and now the water bill is going to go up by 30%. It just means our government is desperately unbalanced.

The rising cost is a disincentive to continue living here, and I’m exploring establishing parts of my business elsewhere.

The core of Singapore is our people.

Help them ride the wave of the new economy by educating them to face the challenges of the future. Spend more money on education by reducing classroom sizes to 20 or less. Pay teachers well, just like the foreign schools which deliver results.

Pay civil servants such as SAF, SPF and SCDF personnel well.

Pay NS men well so they are proud to serve. They feel they are earning less than migrant Work Permit workers. They are the cornerstone of safety and security of our country. They feel they are cheap labour.

NS men should have life time medical benefits and priority in public housing schemes.

We have cultivated a society free from crime and corruption since independence. Today our population has doubled. When there is a problem Singaporeans are blamed. Chances are 50:50 it is someone from another country who looks like a Singaporean that’s at fault. We are at a tipping point, just like the Americans, who spoke up when they elected President Trump.

I hope there was a more sincere push in our Budget to make our people happier, healthier and more prosperous.

Gerard Ee, PBM, BBM, PJG, Fellow of the Institute Of Certified Public Accountants.

For the accounting sector, several schemes may be useful. The New International Partnership Fund may be applicable for local firms to expand into the region to provide consultancy and related services.

The creation of capabilities in data and cyber security is definitely useful for the profession. The profession has been going digital in many ways and hopefully the assistance for SMEs to build digital capabilities can be tapped.

Already, audit working papers have gone digital for the larger firms and if this fund can be tapped, the smaller firms can level up in capabilities. Thus the key matters of most interest to the accounting profession would be those schemes which help them to expand beyond Singapore, build up digital, data and cyber security capabilities and those which help create human resources such as the Attach and Train Scheme.

None of the proposal is detrimental although quite expectantly individuals wish that the list would be much longer.

But I feel it is a realistic budget and ultimately it is for entities and individuals to be personally motivated and tap on the schemes applicable for their advancement.

The Budget does make some provisions in line with the Committee On The Future Economy (CFE) but I don’t expect the Budget to provide clarity. It is the work of the various implementation committees to translate into action the vision of the CFE.

As the future — near and distant — is uncertain, it is prudent to deal with the essentials. Accelerating infrastructure projects will give a boost to the local economy. Having a near balanced budget when there is so much uncertainty is the right strategy. The Trump and Brexit effects, and forthcoming elections in Europe must play out first.

Rhonda Wong, co-founder and Chief Executive Officer of Ohmyhome

Measures on International Partnership Fund and SME Working Capital Loan could potentially help increase the risk appetite of Ohmyhome, giving a more competitive advantage to expand and grow on an international basis.

Budget 2017 highlights an increase in CPF Housing Grant, signalling government intervention, providing aid to the public and directly boosting the potential HDB transactions in the market. This allows Ohmyhome to provide the option of free DIY HDB transaction services to more families.

Property cooling measures remain a concern, but we are confident that the Budget would serve the best interest of our business and community.

In my opinion, Monday’s Budget speech added much clarity towards the mentioned medium- and long-term recommendations in the CFE Report.

Amid the global economic uncertainties, Budget 2017 narrowed focus on achieving targets and subsidising the community, deviating slightly from the bigger picture or unifying vision that would lay the groundwork for a more sustainable workforce.

Budget 2017 may benefit the public more by providing insights on economic views via a macro scale or possibly elaborating more on the government’s steps to catapult the nation forward during an uncertain period.

Teng Theng Dar, Founding Chairman Asian Entrepreneurs Exchange

The key things in the Budget that would be useful are digitalisation and internationalisation. Nothing new though but it has to be taken as one ongoing restructuring that we must pursue.

However, it would be much clearer to all of us if the Budget can define clearly the difference between digitalization, e-commerce and e-solutions. While innovation and productivity are essential for our businesses for many years to come, it is our ability to use the virtual world to connect with real world opportunities that will help the global market place move ahead.

Since we are all aware about the challenge in the structural shift of our economy, the support for transitions could have been emphasised louder for companies, individuals and households. This would go a long way to encourage readiness to shift, and reduce the fear of having to go through transformational shifts.

It would have been helpful if more emphasis and explanation could have been given on how the government will provide transition and new capacity acquisition support to companies as well as individuals.

We have more than 200,000 Singaporeans living, studying or working overseas. They should be tapped as contributors/enablers for the internationlization of our companies.

This should have been mentioned as our ready capital to help more companies to follow this path.

Anthony Joanath, Undergraduate

I want to be an entrepreneur, and I feel the $600 million International Partnership Fund will help homegrown firms.

The increase in the Central Provident Fund housing grant will be helpful in purchasing a flat down the road.

While I don’t see anything negative in the Budget, I feel more tax relief and healthcare subsidies for National Servicemen would have been helpful.

Educational grants for Singaporeans studying in foreign schools might help in the upcoming internationalisation of the future work force. And for those getting older and the disadvantaged in society, a social net would be helpful and show a side of government that is in support of all levels of society.

Main Image: arttonick / Shutterstock.com


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