On the eve of Budget 2023 state media (which function as LHL’s private re-election team and disinformation agent) are warning Singaporeans that while there will be “Valentines Day goodies”, not to expect too much. As part of the Government’s “No Free Lunch” mantra (which curiously only applies to you the people but not to the PAP elite, their relatives, hangers-on and cronies) hard choices have to be made because of the Government’s limited fiscal resources and inexorably rising spending needs.

Take healthcare for example. The line they want you to swallow is that Government spending on items like healthcare is having to go up because of the aging population. According to Lawrence Wong Government health expenditures will rise from $20 billion in 2020 to $60 billion by 2030. I have already pointed out that this would mean Singapore would be spending over three times as much per Singapore resident as the UK NHS spends per capita (see here, here and here). But in the UK all treatment is free and prescriptions are heavily subsidised whereas Singaporeans pay for all treatment and medicines. In the Revenue and Expenditure estimates Lawrence Wong mysteriously leaves out the revenues collected from Singaporeans which are held in unaccountable private companies grouped under MOH Holdings. Nor does he take into account the Government’s earnings on Singaporeans’ Medisave and Medishield balances. Medisave balances have already reached $110 billion and continue to grow rapidly. Restrictive rules ensure Singaporeans cannot use much of their Medisave for medical expenditure. Expect Lawrence Wong to raise health expenditure substantially again in this year’s Budget and to use this as a justification for raising taxes like GST which already hit lower income Singaporeans hardest. It is hard to see Singaporeans seeing much benefit from this expenditure as wait times at A&E and for hospital beds continue to be unacceptably long. I suspect that the health companies my be a conduit by which funds are channelled through the Budget to our sovereign wealth funds (SWFs). It is remarkable that the growth in healthcare expenditures seems to match the increases in the Net Investment Returns Contribution (NIRC).

Another area the Government uses to divert current revenues to our SWFs is through the grants it provides to HDB to purchase land at “market prices” from the Government and provide so-called “subsidies” to Singaporean purchasers of BTO and resale flats. The money paid forms part of Past Reserves and is transferred to our SWFs to be managed. These amounted to nearly $5 billion in 2022. The Government has already signalled it is likely to increase housing subsidies in this Budget to offset rising HDB prices which it is in a position to control through its monopoly over land.

No doubt Lawrence Wong will make much of the fact that, even on the Government’s own fake Budget figures, an estimated deficit of $3 billion has turned into an actual surplus pf $2.8 billion. He will say that this provides him with up to $6 billion of fiscal resources for extra spending this year. Singaporeans will be expected to be grateful as though the money came from the pockets of our Ministers themselves and to vote enthusiastically for the PAP and the septuagenarian LHL come the next GE.

However Singaporeans should know by now from my blog that this is BS. The Budget only represents a small fraction of the true surplus and of the immense resources that the Government should possess, though no one can be certain as Singaporeans’ acceptance of the PAP’s mantra of “ownself check ownself” has meant zero accountability and very limited visibility. But there are certain things I can discover. Even on the Government’s own statistics the cash surplus of the General Government since 2005 (including capital receipts and land sales) has been $343 billion. This includes the pandemic year of 2020 when there was supposedly a cash deficit of $35 billion which strangely is the figure I calculated (though as I said when we take into account the amount of aid through schemes like Job Support channelled to state-owned companies the true cash deficit was much less).

But the $343 billion figure does not include the growth in the value of GIC, MAS and Temasek’s portfolios as well as other state-owned entities like MOH Holdings and Changi Airport Group. Just looking at Temasek alone, its assets grew from $103 billion in 2004 to $403 billion in 2022, an increase of $300 billion. The Government refuses to tell us the size of the assets GIC manages and we have very limited insight into how they have grown over time. But it seems reasonable to assume that GIC’s assets net of debt have grown by $300 billion to perhaps by as much as $1 trillion over the same period. If the growth was about $600 billion then the total surplus over this period was of the order of $1.2 trillion before adding in MAS and the other state-owned entities. As I have frequently written, accepting the Government’s own NIRC at face value and calculating backwards from that, I get a total value of financial assets in the region of $2.6 trillion!

The Government treats you like children and thinks that if it stonewalls enough you will forget all about the huge sums of money extracted from your hard work and going without over decades and like the animals in Animal Farm just continue to vote for LHL and keep working after a bit of complaining. Show the PAP that you will not accept their lies and equivocations any longer! Ask LHL why taxes need to go up and why tough choices have to be made (by you but not by him and his Ministers!). The Government says it has to safeguard the reserves for future generations. But by failing to provide even a modest level of financial support for our people the PAP Government is ensuring that most of the original Singaporeans will die out and be replaced by new citizens. This undoubtedly suits LHL as, like his father, he probably has a low opinion of the intelligence of our people and prefers FTs. It is time for you to stand up for your rights and demand accountability!

Published by kjeyaretnam

I'm a Singaporean economist who became an opposition activist. I blog to provide an alternative to the porkies that the Pinkies tell. It just so happens that my alternative is the truth. That's why I've never been sued in any civil or criminal court no matter how hard hitting my criticism. I'm quoted and interviewed and asked to speak across the world but largely censored in Singapore in an effort to silence my political opinions. The left hate me because they think I split their vote and because I eschew their outmoded economic models. Models that don't work. The Right and the Conservatives hate me because I'm a liberal. I'm not sure what the middle think of me. I don't think there are more than a handful of people in the middle, here in Singapore. I'm a Singaporean born and bred, dual heritage, my parents Singaporean established here before the State of Singapore was created. I'm not Eurasian. I read economics at Cambridge and could be broadly described as from the Keynesian school but I believe in interventions. I was formerly a successful hedge fund manager. After economics and politics my greatest interests are history, film and Makan. I run but I run so I can eat like a Singaporean. View all posts by kjeyaretnam