• Focus on expanding economy
• And growing enterprises
• 2016 growth of 1-3%

Budget surplus expected in 2016

The Singapore government has announced the Budget for 2016, with an eye on boosting economic expansion and innovation for the future, as well as helping those displaced by economic transformation. The Budget is expected to spend a total of S$33.9b for healthcare, education and transport, to grow Singapore's economy and invest collectively for the long term - in its people, home and security.

It should still end with a surplus of S$3.4b; and this is made possible by the large expected Net Investment Returns Contribution (NIRC) of S$14.7b, as Temasek has been added to the NIRC framework.

Main spending on education, health and transport

To grow the economy, Singapore will invest in building strong enterprises and nurturing innovative industries. For the people, it will invest S$12.8b in education; it will also increase health spending to S$11b, and is set to increase as the population ages. Transport will get S$10.1b, albeit a decline of 9.3% compared to 2015.

GDP growth likely in 1-3% range

However, the Finance Minister Heng Sweet Kiat announced that he expects GDP growth to stay in the 1-3% range, after economic growth slowed to 2% growth in 2015 from 3.3% in 2014, given the strong headwinds from the weakness in the global economy.

Due to the economic uncertainty, the government has also announced six measures to tide SMEs and struggling sectors over (details are in the individual sector summaries).

On the individual front, the government has launched new initiatives for the Silver Support Scheme to help youth, seniors and disabled workers.

The government has also introduced several Family Oriented Schemes to help Singaporeans start a family and raise their children. And other family and individual oriented schemes include a one-off GST voucher, as well as service and conservancy charges rebate, with the bulk of the benefits aimed at helping the lower income family.

Source: OCBC Research - 28 Mar 2016