EXPENDITURE PRIORITIES

Social & Community Services

Overall, as in the past years, the largest share of Government's expenditure budget goes to the Social & Community Services sector. It accounts for 39.6% of total expenditure. In absolute terms, the sector's allocation of $11.5 billion is an increase of $856 million over FY99. Education, Community Development & Sports, and Health will all get substantial increases in their budget allocations.

Spending on educating our young continues to take up the lion's share within the Social & Community Services sector, with $6.0 billion or 52% going to MOE. This represents an increase of $881 million or 17% compared to FY99. Within MOE, the General Education Programme undertaken by the Government, Government-aided, special education and independent schools accounts for $3.1 billion or 53% of its total budget. The three universities take up $1.2 billion or 19% while the four polytechnics and the Institute of Technical Education (ITE) account for $585 million (or 10%) and $167 million (or 3%) respectively. The balance of $915 million is for the remaining programmes of MOE. In terms of development expenditure, the bulk of the $2.0 billion allocated will be used to build new schools, rebuild and improve existing schools, as well as to expand the teaching facilities in the tertiary institutions.

Public Housing takes up the next largest slice of $2.3 billion of the budget allocated to the Social & Community Services sector. Funds for Public Housing will be used to pay the subsidy for HDB's bottom-line financing, the Selective En-Bloc Redevelopment Scheme, as well as the various HDB upgrading programmes. MOH (with $1.2 billion), ENV (with $972 million), MCDS (with $610 million), and MITA (with $379 million) round up the budget for this sector. MCDS and MOH will get substantial increases of 38% and 10% respectively in their FY2000 budgets. Within MCDS, the Elderly Development Programme will have its allocation increased by 55% to $12.3 million. Expenditure on this programme will increase further when more of the recommendations put forward by the Inter-Ministerial Committee on the Ageing Population are implemented.

Security & Defence

The second largest sector is Security & Defence, which takes up $9.6 billion or 33% of total Government expenditure. Of the $9.6 billion, $7.4 billion will go to MINDEF to fund defence programmes. The remaining $2.2 billion will be for MHA and Civil Defence programmes. MINDEF's budget will make up 4.5% of GDP, well within the ceiling of 6% of GDP set for MINDEF.

Of the $2.2 billion allocated to MHA (including Civil Defence), $1.0 billion or 47% will be for the Police Programme while $351 million or 16% will go to Civil Defence. Development expenditure will be mainly for the MHA Complex, Cantonment Complex, Civil Defence Shelters Programme, redevelopment of the Gurkha Cantonment, SCDF HQ Complex and Neighbourhood Police Centres. Economic & Infrastructural Development

Economic & Infrastructural Development forms the third largest sector, taking up $5.9 billion or 20% of total Government expenditure. Within the sector, MCIT has the largest share of $2.2 billion, followed by MTI with $1.9 billion. MND is allocated $584 million, but this excludes Public Housing which is funded separately. MOM will receive $171 million. The remaining $978 million allocated to this sector is used to fund all the R&D programmes undertaken by ministries.

Economic development will continue to take a three-prong approach: investment in infrastructure, creation of new economic activities to achieve sustainable growth and comprehensive development of our workforce to meet the challenges of economic restructuring. Infrastructure investment is achieved mainly through projects undertaken by MCIT, MTI and MND. MCIT will spend $1.2 billion to make rail-based improvements to the land transportation system and a further $260 million to make road-based improvements. MTI will spend $780 million to develop projects on Jurong Island and a further $380 million for reclamation at Changi East, Sentosa Cove, Southern Islands and infrastructure works at Kaki Bukit and Tuas View.

EDB and TDB together will undertake the task of creating new economic activities. EDB is allocated $309 million for this purpose while TDB will receive $38 million. MOM will be responsible for the development of our workforce and is allocated a sum of $171 million. This represents a 68% increase from the FY99 allocation.

General Services

The General Services sector, comprising MFA, organs of state, and the central ministries, continues to take up the smallest share of the total Government expenditure at 7%. Our intention is to keep the central administration lean, and let the operational ministries have the bulk of the resources.