News this week included: Singapore’s fertility rate at a historic low, while traffic deaths hit a 10-year high; Lawrence Wong asserting that there’ll be no “jobless growth” even as AI reshapes the economy (good luck, sir); Deliveroo exits the Singapore market; a Tampines Taoist temple offers blind boxes to attract young visitors (Jom wrote about the broader phenomenon last week); an analysis by The Straits Times (ST) of shrinking home sizes; ST on dealing with burnout at work; PAP MP Shawn Huang awkwardly stitches together the symbolism of the “rooster bowl” with the three supposed “kias” of Singaporean identity: kiasu, kiasi, kiabo; and a CNA investigation that reveals an extensive AI-driven disinformation campaign, through Mandarin videos on YouTube, targeting Lawrence Wong and Singapore—one that “suggest[s] a state backer” (though of course “Beijing” and “China” are not words that can be uttered in the piece).
Politics: Parliament debates the budget...
Last year, the economist Donald Low questioned the government’s “fiscal marksmanship” after it emerged that the FY25 budget surplus was more than S$5bn above estimates. This year, the government’s aim has worsened, with the surplus outstripping projections by S$8bn. Persistent under-estimation, Low had said at the time, feeds a fiscal conservatism that leaves social needs unmet and provokes tax hikes both steep and hasty (cough GST cough).
Gerald Giam, a Workers’ Party MP, took up the theme during this week’s budget debate, claiming that taxes enabling such huge surpluses drain liquidity from the economy, choke household spending, and make people dependent on government handouts. “We need more accurate forecasting that ensures our nation’s abundance benefits current generations as much as future generations,” he said. Further, amidst all the rah-rahing about the surplus and GDP growth—Singapore’s five percent surge in 2025 is considered exceptional for a developed economy—Giam cautioned we’re becoming a “two-speed economy” in which much of the growth is powered by giant corporations and much of the benefits accrue to them. Further, shiny headline numbers obscure serious problems; among others, the fact that the top five percent of households hold a third of the country’s wealth, the ongoing bloodbath in the F&B sector, and youth employment struggles—likely to intensify as AI disruption continues apace, leading to more “jobless growth”.
Shawn Loh, a People’s Action Party (PAP) MP, felt that far too many are having to contend with the rising costs that attend a burgeoning economy, but without an attendant increase in spending power. This is especially true of retirees with no income. Loh proposed a redistribution scheme in which any surplus beyond the equivalent of two percent of GDP—last year’s was 1.9 percent—would be returned to Singaporeans. This could be done not entirely or necessarily via cash transfers or CDC vouchers, which could stoke inflation, but through CPF top-ups, and rebates on public transport and utilities.
Others, like Nominated MP Terence Ho, suggested a universal annual dividend, its size determined by the prevalent economic winds. This would go some way toward making Singaporeans feel they’re active agents in the nation’s growth story. It may also inject some transparency into where this flood of money is being diverted, a concern voiced by Pritam Singh, another WP MP. “The government should be conscious of the public cynicism and detachment that grows when Singaporeans cannot see a clear accounting of how public funds are being used and communicated,” he said. It’s unclear, for instance, how the S$40bn earmarked for the Forward Singapore package in 2024 has been used. Singh called for publicly available “report cards” that track the performance of all such major government initiatives.
Numerous factors, many beyond the establishment’s control, are changing Singapore society swiftly and markedly. To keep up, our social welfare policies too may soon need a radical shift.
Some further reading: In “Why Singapore’s elderly continue to work: reserves and CPF demystified”, Bobby Jay makes an analogous argument about distributing state investment gains to the people. “The government could offer the current CPF rates as a minimum guarantee and then share the actual returns—for example, the 6.9 percent per annum GIC returns over twenty years—it makes on the CPF funds with its citizens.”
Politics: ...and Lawrence responds
The healthcare costs associated with an ageing society can only be met with a “broad-based and sustainable option,” Lawrence Wong, prime minister, told Parliament. Neither additional corporate tax, nor higher taxes on property, vehicles, and income can provide that kind of structural support. And once the government had rejected WP’s suggestion to increase the maximum Net Investment Returns Contribution (NIRC) available for the budget from 50 percent to 60 percent, raising the GST was the only option. No one could have predicted Singapore’s economy would catch fire the way it did—if it hadn’t, and had the GST stayed unchanged, “we would be having a very different debate today.”
Wong defended the government’s awry projections too; doing so is becoming tougher in an increasingly complex global environment, he said. “Because we are so dependent on the external environment, forecasting Singapore’s GDP growth is like forecasting the world’s GDP growth, which is very, very difficult to do.”
Responding to Singh’s call for greater transparency around government spending, Wong pointed to the Public Sector Outcomes Review report, published biannually since 2010, which allows citizens to scrutinise progress in major policy areas. Still, he promised, “I will ask all ministries to provide clearer and more accessible information on major initiatives.”
