Budget 2025 a Budget for today and the future: Panel

SINGAPORE – A generous Budget that provides both families and companies with extra resources to deal with immediate needs, while also setting serious money aside to deal with Singapore’s future ones – that was the consensus at a post-Budget panel convened by The Straits Times.

While it will likely be remembered for its largesse, panellists said the Republic’s diamond jubilee Budget should be credited for expanding on moves made in recent budgets to help workers stay nimble, and to make Singapore a more family-friendly place.

The discussion on Feb 19, which took place a day after Prime Minister Lawrence Wong delivered the Government’s $143.1 billion spending plan, was led by The Usual Place podcast host and ST correspondent Natasha Ann Zachariah and ST senior business correspondent Claire Huang.

On the panel were Minister in the Prime Minister’s Office and Second Minister for Finance and National Development Indranee Rajah; Singapore University of Social Sciences labour economist Walter Theseira; and Singapore Business Federation (SBF) chief policy officer Musa Fazal.

“The key takeaway for me is that the Budget is actually doing a good job of building on what the most recent budgets have done in trying to support our families and workers,” said Associate Professor Theseira.

The continuation of the CDC Vouchers Scheme – to the tune of $800 per household in financial year 2025 – and the new SG60 vouchers showed a continued emphasis on mitigating cost of living pressures for Singaporeans, he noted.

Mr Musa said support for businesses has likewise been generous in this Budget, and companies appreciated the 50 per cent corporate income tax rebate, which will save large companies as much as $40,000 in taxes.

Zooming out, Ms Indranee said that besides alleviating immediate cost pressures, Budget 2025 was about the Government allocating its financial resources strategically in key areas to ensure the Singapore economy will continue to grow.

“The bigger objective is that you want to get the economy going, because if the economy grows, then that means more jobs, more opportunities and better income,” she said.

Building on blocks laid in previous budgets

Support for families was one aspect of how Budget 2025 built on earlier budgets, noted Ms Indranee.

In 2023, paid paternity leave was doubled to four weeks, while the Baby Bonus cash gift for each child was raised by $3,000. In 2024, PM Wong announced that new parents will get 10 extra weeks of government-paid parental leave, for a total of 30 weeks by April 2026.

“We’ve done these building blocks for families so we asked ‘what’s the next thing’, and we said larger families,” said Ms Indranee.

This is as parents start becoming more concerned about costs after their second child, and the Government wants “to get them over that hurdle”.

The new Large Families Scheme announced at Budget 2025 will provide parents with an additional $16,000 in support from the third child onwards.

As for whether the latest moves will encourage Singaporeans to have more children, Ms Indranee said the Government has been systematically putting in place changes to address worries, whether that is work-life balance with the parental leave schemes; competition stress through reforms to the education system; or catching up on housing projects delayed by Covid-19.

“What we’re actually trying to do is make Singapore family-friendly, so that if you want to have children, you can,” she said.

Even with these changes, Prof Theseira said the mindset among some would-be parents – that they have to invest heavily in their child or he will lose out, and to not bother having one if they cannot – will take time to change.

“You cannot subsidise or grant your way out of that problem,” he said. “It has to be perhaps a societal mindset shift, supported with the appropriate changes in the education system.”

Something for everyone, singles included

With PM Wong having billed Budget 2025 as a Budget for all Singaporeans, Ms Indranee was asked whether there were any groups left out, such as singles.

She said singles stand to benefit from greater eligibility to buy two-room flexi Build-To-Order (BTO) flats from the Housing Board, including those in choicer locations.

While the broadening of eligibility and the new flat classification framework were announced earlier, it will really be implemented through monies in this Budget allocated to the Ministry of National Development for housing, Ms Indranee added.

This will also be the case when, from mid-2025, singles get priority access to buy a BTO flat near or with their parents, in a scheme that PM Wong announced at the 2024 National Day Rally.

“I would say that this Budget has something for everyone,” said Ms Indranee. “You just need to know where to find it.”

In a light-hearted moment, Prof Theseira said Singaporeans could take advantage of the $100 in SG Culture Pass credits they will get in September to go on dates. The credits can be used to buy tickets for eligible local performances, exhibitions and experiences, such as learning tours.

“(That was) an unexpected thing in this Budget,” he said.

Keeping mid-career workers agile

The theme of building on measures from earlier budgets carried through to the upskilling and retraining of workers.

Prof Theseira said the Government’s focus has been on two groups: younger lower-wage workers who need help to move up the wage and skills ladder; and the more middle-aged professionals, managers, executives and technicians who face job uncertainty due to the pace of disruption.

The second group is arguably the bigger challenge, he added.

“As long as they’re in stable employment, things are fine, but because of the pace of business change… if something were to happen to their industry or role, if they’re out of their job, they actually may face a lot of difficulty pivoting and transitioning to a new job, new career,” he said.

Ms Indranee said supporting mid-career workers to reskill was why the authorities announced the SkillsFuture Level-Up Programme in 2024 to help those aged 40 and above acquire a second diploma with government subsidies.

In Budget 2025, the Government said it would extend monthly training allowances to mid-career workers who attend selected part-time courses. Lower-wage workers can tap the training allowance sooner, on turning 30.

SBF’s Mr Musa said he was heartened to see measures in this Budget that tie together workforce transformation with enterprise transformation, such as higher funding support of up to 70 per cent for job redesign activities.

The new SkillsFuture Workforce Development Grant, which aims to consolidate various existing schemes and simplify the application process, will hopefully reduce the application burden on businesses having to apply to different agencies to tap different schemes, he added.

“It’s not like the grants are not out there, but if I have to apply to many different government agencies and they all have different requirements and procedures that I must fulfil in order to qualify, it becomes a heavy burden,” he said.

Longer-term pay-off

Much of the fiscal firepower from Budget 2025 was also devoted to boosting innovation and investing in infrastructure for the future.

Ms Indranee pointed to the $5 billion that the Government had set aside to top up the Changi Airport Development Fund, including the construction of Terminal 5. Another $5 billion was injected into the Coastal and Flood Protection Fund, which was set up in 2020 to protect Singapore against the effects of climate change.

She added that ensuring that Singapore has access to enough energy – particularly clean energy – would be “our biggest challenge going forward”.

Hence, an additional $5 billion will be pumped into the Government’s Future Energy Fund, first announced in Budget 2024, while the Republic explores the feasibility of nuclear as a clean energy option.

Another critical area of investment was in the enterprise ecosystem and to help companies here to grow, said Ms Indranee.

To anchor more multinational firms here, Budget 2025 included a $3 billion top-up to the National Productivity Fund, while a new $1 billion Private Credit Growth Fund will provide high-growth local enterprises with more financing options.

Another $1 billion has been dedicated to accelerating research and development in the biotech and semiconductor sectors here.

Ultimately, the panellists said the Budget has laid the groundwork for a future-oriented Singapore.

Ensuring that Singapore remains a choice destination for investors and highly skilled migrants is imperative if the Republic is to have the resources to deploy for Singaporeans, said Prof Theseira.

“It’s all about trying to plan ahead and making sure that when we do have predictable long-run expenditures that we’re going to need to provide for – we do have to provide for the baby boom generation of Singaporeans the next couple of decades – then we have to match that with reliable sources of revenue as well,” he said.

Mr Musa echoed this sentiment of economic growth as an anchor for a secure revenue base for the long term, while noting that nearby countries are nipping on Singapore’s heels.

“We have to bear in mind that our economic dynamism is also a function of what’s happening in terms of our competitors, so it’s not just a static thing.

“We have to run the race, and we have to run it faster than others around us… and continue to think of new ways in which we can create value for Singapore, and sustain that value over the long term.”