The Singapore 2015 Budget – what it means for you, Mr Citizen?

The 2015 SG50 budget was announced yesterday and it is an all-round sweet deal for many people! For the first time, middle and upper-middle income households have plenty to cheer about. If the 2014 budget was for the pioneers, then the 2015 budget is for the bulging middle. It creates a great euphoria for which, if I were the PM, I would call for the election real soon. But of course I am not the PM and we don’t talk politics on this forum. So in this article, I shall look at the impact of the measures for individuals and households and see the implication this has for your strategic decisions. Tomorrow, I shall look at the impact on businesses, especially for SMEs.

Lifelong Learning

If there is a consistent thread in the government’s interventions, it would be lifelong learning. That we have a government building called the Lifelong Learning Institute (upon which this article is written) is testimony of this government’s commitment to ensuring that our citizenry doesn’t become structurally unemployed. That the government intends for every Singaporean to take active responsibility for their career right from the onset of graduation is evident by its investment in more career counsellors in schools. This continues on to later life stages with the SkillsFuture schemes. With several different schemes for different life stages, the government is serious in making lifelong learning, well, lifelong.

Internationalisation is also another worthwhile thread. Putting international internships within Institutes of Higher Learning (IHL) curriculum is very effective in helping Singaporean students look beyond our shores, and find employment elsewhere. This same thread is boosted for businesses as well, making internationalization a key strategy for Singapore in the coming years.

CPF Savings

The raising of the CPF ceiling from $5,000 to $6,000 definitely impacts middle income earners the most. But the increased CPF savings is not meant to entice the middle-income households to upgrade to a new property. In fact, CPF savings are meant to be used progressively as evident from the higher interest garnered for monies remaining in the account after age 55.

Emergent semblance of Western social security?

The Silver Support Scheme is a brand new feature that has a flavour of Western social security. Monies will be given to the lower income retirees. Although modest in amount, ranging between $300 to $750 per quarter, this can be a significant boost to our less privileged neighbours. Yet there is a huge implication here for the whole nation. The minute we start on this course, it is very difficult to back down. The “Fixes that fail” system archetype tells us the initial fix can cause a problem in the future when that fix is no longer enough. It is like taking antibiotics. As each progressive fix is applied, the virus becomes more resistant to the drug, thereby needing a stronger and stronger dose. Are we beginning to slide down a slippery slope? Only time will tell.

Support for Growing Years

There are a slew of initiatives for our young. Childcare support has been enhanced; school-going children have CDA, Edusave and PSEA top-ups; exam fees for national exams have been waived, and financial assistance for the needy have been expanded. All these benefit not just the lower income families, as middle-income families also have a significant share.


And finally, there are the rebates and benefits, which for some is a euphemism for handouts. There is the GST Voucher, the quantum of which has been increased by at least $50 per person; there is a reduction in foreign worker levy which will impact middle-income families the most (since low income families don’t have maids), there is a 50% income tax rebate which has been handed out for no particular reason and capped at $1000 – which again benefits the middle-income families the most. There is one minor inconvenience to our middle-income families – the increase in petrol tax. I suppose this is in response to the falling petrol prices. After all, the government wants to put a tight lid on car ownership and usage. But they did hand out a one-time olive branch, a 20% reduction in road tax for a year.

A boon for the burgeoning middle-class

After last year’s Pioneer budget, this year’s middle-class budget will surely go down very well with the electorate, I mean, citizenry. With a burgeoning middle class, the government expenditure to meet this extremely generous budget will be very high. And so it is, since this is the biggest budget in Singapore’s history. Yet, while it seems to be middle-class friendly, it will make many Singaporeans smile and that is what SG50 should be all about – a means for us to celebrate our first 50 years, and to look forward to the next 50. Who knows, for SG100, everyone might well be “middle-class”. So here’s to the next 50 years!


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