PSP files motion to question Govt’s budget and reserve accumulation policies

SINGAPORE: Leong Mun Wai and Hazel Poa, both Non-Constituency Members of Parliament (NCMP) from the Progress Singapore Party (PSP), filed a motion to question the Government’s Budget and reserves accumulation policies.

In a Facebook post on Thursday (25 January), Mr Leong, PSP Secretary-General, revealed that the motion will be debated at the next parliamentary sitting on 5 February.

The motion reads:

“That this House calls on the Government to review its current budget and reserve accumulation policies in order to help present-day Singaporeans reduce their financial burdens and improve their quality of life, while continuing to save for future generations of Singaporeans.”

Mr Leong highlighted that by deliberating on this motion, PSP aims to foster a comprehensive discussion and heighten awareness among Singaporeans regarding the merits and drawbacks of the existing policies.

He critiqued the People’s Action Party (PAP) Government’s historical approach, noting that it often asserted there could never be “too much reserves” and that national security concerns prevented the disclosure of the exact reserve amounts to the public.

“PSP believes that this approach does not do justice to the fact that the reserves are accumulated from the blood and sweat of Singaporeans. ”

He emphasized the inherent costs associated with accumulating reserves and stressed that, as collective owners of the nation’s reserves, Singaporeans should have a more substantial role in determining the accumulation levels, current utilization, and provisions for future generations.

“I look forward to having a constructive debate with the PAP ministers and MPs, ” Mr Leong concluded.

PSP’s quest to scrutinize government policies on National Reserves

PSP has consistently pursued challenging inquiries into government policies related to reserves.

For instance, in February 2023, the party presented an Alternative Budget proposal, outlining long-term programs aimed at providing “Singaporeans comfort over their current and future financial positions.”

Mr. Leong contended that Singapore possessed ample fiscal resources to fund these programs without tapping into the national reserves.

He pointed to the Government’s estimates indicating excess fiscal resources, citing the commitment to a S$100 billion Covid-response package, equivalent to over 20% of Singapore’s GDP in 2019, as evidence of the country’s strong fiscal position.

During the parliamentary sitting on 24 February 2023, Mr Leong asserted that middle-class Singaporeans are overtaxed, highlighting goods and services tax (GST) and the certificate of entitlement (COE) as significant factors.

Deputy Prime Minister and Finance Minister Lawrence Wong strongly rejected this claim, stating that Singapore’s middle class has seen significant real income growth over the past two decades.

He argued that the middle-income group in Singapore receives more in benefits than the taxes they pay. Leong challenged Wong’s statements, arguing that the calculation of tax-benefit and tax-income ratios doesn’t consider land costs paid through HDB flat prices.

Mr Leong accused the government of hoarding resources and criticized the increase in government expenditure, questioning if GDP had grown accordingly.

He questioned the amount of Net Investment Returns Contribution (NIRC) tucked away and criticized the government for raising GST despite having significant revenues.

In response to Mr Leong’s series of questions and clarifications, Mr Wong at the time pointed him to his earlier speech and did not provide the figures that Mr Leong sought.

PAP Govt refuses to reveal or confirm reserves

Revealing the size of Singapore’s reserves would be akin to laying bare the country’s defence plan, diminishing the value of the reserves as a strategic defence, said former Deputy Prime Minister Heng Swee Keat during the Budget debate of 2021.

In response to NCMP Hazel Poa’s call for more transparency regarding the size of Singapore’s reserves in her Budget speech on 24 February 2021, Mr Heng, who was then the Finance Minister, remarked that disclosing its size was not in Singapore’s national interest.

“No responsible leader would do so,” he stated at the conclusion of a three-day debate on the Budget.

The Singapore Government, in a report published by the Ministry of Finance, had previously disclosed a total of S$1.4 trillion in financial assets in the Government Financial Statements Report for the financial year ending 31 March 2021.

In March 2022, when queried in Parliament by Mr Leong about the accuracy of the data, the Second Minister for Finance Ms Indranee Rajah refrained from directly confirming the figure.

She instead inquired about the source of the data, saying, “if the data is already available to the public, then I don’t need to confirm it.”

Later, in a Facebook post, Mr Leong expressed his dissatisfaction, stating, “It’s disheartening that the Second Finance Minister, Ms Indranee Rajah, repeatedly avoided confirming the $1.4 trillion figure. Nevertheless, she conceded that if such a figure was released by a government agency, it should be accurate.”