The PAP government owes Singaporeans an explanation as to how it ‘missed’ statutory boards’ contributions estimate by a mile last year.
In Today’s “S’pore posts record S$9.6 billion budget surplus, thanks to ‘one-off’ factors“, the article briefly explained how PAP managed to generate the ‘unexpected’ gargantuan surplus in FY2017:
1. ” …owing mainly to “exceptional statutory board contributions” and higher-than-expected collections from stamp duties.”
2. “Some S$4.9 billion in statutory board contributions were expected in FY2017, more than 16 times the initial estimate of S$300 million“.**
3. “This was driven mainly by an “exceptional contribution” from the Monetary Authority of Singapore thanks to higher investment returns from recovering global markets, said the MOF”.
Fact: Increased contributions from some stat boards were almost offset by decreased contributions of other stat boards.
The game changer in fact came from only one figure, ie increased revised 2017 “Investment and Interest Income”.
The difference between what was ‘estimated’ and the revised figure: $7 billion! (see Budget 2018 ‘Government Revenue’)
The government needs to explain the huge discrepancy: Where did the additional $6.35 billion dividend come from?
The difference between the estimated surplus and revised figure is $7.7 billion ($9.6 billion – $1.9 billion. $7 billion came from the revised figure of “investment and interest income”.
By injecting $7 billion into the revised figure, it gives the impression of a much-stronger economy which is of course misleading.
Anecdotal evidence strongly suggests that the economy was weak. Arbitrary increase by the government, eg fees, charges, etc. had contributed to part of the increased government revenue.
The $700 million ‘hongbao’ is merely a distraction, its objective to buy silence from Singaporeans.
Without disclosing the source of the $6.35 billion dividend windfall or increased investment income, Singaporeans will continue to speculate that something is amiss.
Especially after the transfer of $5 billion to GIC via the Rail Infrastructure Fund.**
The government appears to have a hidden agenda for introducing “one-off factors”, ie $7 billion from “Investment and Interest Income” with $5 billion set aside in another newly-created fund.
** ‘Statutory Boards’ Contributions’ is stated as $253 million and should not be conveniently rounded off to $300 million to give the impression that the estimate overshot by more than 16 times. It should have been more than 19 times.