Cash on hand, Singapore targets productivity growth with new budget

Feb 17, 2012, 11:48 GMT

Singapore - Singapore's cash-rich government on Friday unveiled a 'budget for the future,' focused on raising productivity, cutting the inflow of foreign workers and doing more for a rapidly ageing population.

The government would concentrate on long-term growth, Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam said in Parliament when presenting the budget for the next fiscal year, which begins April 1.

It made its proposal as it was buoyed by a 2.3-billion-Singapore-dollar (1.8-billion-US-dollar) surplus in the past fiscal year.

Taking note of Singaporeans' concern over the influx of foreigners, the minister said the government would reduce the city-state's dependence on foreign workers.

For a start, the proportion of foreign workers allowed in both the manufacturing and services industries would be cut beginning in July, and the government might consider raising the foreign worker levy from July 2013.

Tarman said 2 billion Singapore dollars would be set aside for a new productivity fund aimed at raising productivity 2 to 3 per cent every year.

The budget contained a slew of other new economic and social measures. Some were aimed at helping specific groups such as older workers stay longer in the workforce, and others were targeted at lower-income and disabled citizens, small and medium-sized businesses, and the transport and tourism sector.

In view of its rapidly ageing population, Singapore plans to double its yearly health-care expenditures to 8 billion Singapore dollars over the next five years.