MINISTRY OF FINANCE

MR LEE HSIEN LOONG Deputy Prime Minister & Minister for Finance

Fiscal Policy

1. The next few years will see lower GDP growth, increased demands on expenditure, and tighter budgets. Maintaining fiscal discipline and sound macro-economic policies is key. These concerns underpin our effort to restructure the economy for competitiveness in an increasingly globalised world.

2. We must keep the tax burden on the economy as light as possible, and maintain a good balance between direct and indirect taxes. This will help keep Singapore attractive to investments and assure jobs for our people.

3. We will pursue a prudent fiscal policy. We will budget for a modest surplus over the business cycle. This will yield enough resources to invest in new growth areas, and deal with the social challenges of economic restructuring and an ageing population in a sustainable way. Monetary Policy

4. We have experienced more frequent shocks as the world economy has become more inter-linked and volatile. Monetary policy, centred on the management of the exchange rate, aims for price stability while being supportive of growth. Its objective is low inflation, a stable currency and sustained economic growth.

Facilitating Business and Enterprise

5. We will make Singapore "Best for Business" by simplifying business regulations and enhancing corporate governance and accounting practices. This will attract global capital and support Singapore companies in their efforts to reach world-class standards. We will set up a Council on Corporate Disclosure and Governance to set accounting standards and advocate best practices in corporate governance.

6. Government fees and charges will be set to recover costs, except where we need higher rates to deter the misuse or misallocation of resources. The Government will outsource services to the private and people sectors wherever this is cost effective.

7. The Government expects companies it holds shares in to operate commercially, without any preferential treatment. Many of these companies will contribute to Singapore's external economy by expanding into significant businesses in the region and beyond. The Government will progressively divest its commercial investments which are no longer strategic, as market conditions permit.

Budgeting Wisely

8. We will incentivise Ministries to focus on obtaining the best outcomes with the resources available. We must strike a judicious balance in allocating funds among the economic, social and security sectors. Helping citizens adjust to the new economic conditions is a high priority. An ageing population also presents special demands, especially in community services and healthcare. We will make more use of means-testing to target government-financed assistance and subsidies.

Excellent Public Service

9. The Government will make public services more customer-centred, through the e-government programme. "Many Agencies, One Government" will provide greater convenience to the public. We will set up more e-Citizen Help Centres, to service those who lack personal access to the internet or need help to cope with it.

10. All government agencies will aim to achieve national and international benchmarks of organisational excellence, especially the ISO-9000 series of quality management standards, the People Developer Standard, the Singapore Quality Class, and the Singapore Quality Award. They will continually review their regulations to reduce red tape, removing them altogether wherever possible.