So we are once again at the period of the year where the entire nation will be talking about the Budget.
By Constitution, the Government’s budget is tightly and properly managed.
The government will aim to achieve a balanced budget over each term of government. This means that even though the annual budget may return a surplus or a deficit for a particular year, the government will aim to keep it balanced over the term of government (four to five years in between elections).
Should the government decide to draw on past reserves which is the surpluses accumulated in previous terms of government, the President’s assent (approval) is needed, as stated in the Constitution.
In 2009, the government sought former President SR Nathan’s assent to dip into past reserves to fund measures to help Singapore overcome the Global Financial Crisis.
But balancing the budget is not as easy as you think.
The government has a responsibility to be forward-looking, and manage the budget prudently, in such a way that it invests more during good times and supports the economy during challenging times.
To ensure that the budget is balanced with the onset of increased spending, the government actually looks at ways to invest more and increase its revenue base.
This way of maintaining a balanced budget over each term of government ensures public funds are well allocated sustainably.
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