Will Budget 2018 see more Budget cuts for Ministries?

Budget 2018 is less than a week away. But let’s recap a major announcement from last year’s Budget that many don’t actually remember.


One of the announcements during last year’s Budget Speech is the permanent two per cent downward adjustment to the budget caps of all Ministries and Organs of State.

In his Budget 2017 speech Finance Minister Heng Swee Keat said the cut was to “emphasise the need to stay prudent and effective”.

Budget 2018

During his speech, Minister Heng also said that Singapore has a steady revenue stream that results from a pro-growth and progressive tax system.

Together with the returns on the reserves, Minister Heng said “these have allowed us to fund new priorities without cutting back in essential areas”.

But Heng also said that expenditure needs are expected to rise rapidly, particularly in healthcare and infrastructure.

Hence, Heng said the Government must continue to spend judiciously:

“the government must continue to spend judiciously, emphasise value-for-money and drive innovation in delivery. We can do better – and more – with less.”

The Government itself has already started the ball rolling in cutting down its budget for expenditure.

Since it has started the ball rolling, what’s next? Surely there would be more ways to expand the revenue base of the Budget to fund our increasing expenditure needs.

Would there be an increase in tax?

Or would we expect more of ministry budget cuts in Budget 2018?

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Arthur Lee

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