Why is Singapore raising the GST?

Singapore's GST hike to go through after Bill passed in Parliament on 7 Nov 2022

GST will increase from 7 per cent to 8 per cent from Jan 1, 2023 and from 8 per cent to 9 per cent from Jan 1, 2024

Tourists, foreigners living in Singapore paid half of net GST in 2018 and 2019

Assurance Package to help households offset GST hike to get $1.4 billion boost, will now total $8 billion

Workers’ Party’s alternatives to GST hike do not add up, GST hike among options needed to meet funding gap: DPM Lawrence Wong

By Hariz Baharudin and Ng Wei Kai, The Straits Times, 7 Nov 2022

The suggestion that the goods and services tax (GST) increase should be postponed due to current inflationary pressures does not hold water, Deputy Prime Minister Lawrence Wong told Parliament on Monday.

The Government’s support measures delay the effect of the hike by at least five years for the majority of Singaporean households, he said.

That the support is targeted at lower- to middle-income households, rather than broad-based, will also minimise any additional inflationary pressures, he added.

“We have designed the overall package to ensure we neither stoke inflation inadvertently nor choke aggregate demand, and this is an appropriate macroeconomic stance to adopt at this juncture,” he said.

Rounding up the debate on the GST (Amendment) Bill, which saw 15 MPs speak, Mr Wong rebutted alternatives raised by Workers’ Party MPs Louis Chua and Jamus Lim (both Sengkang GRC) saying these entailed spending more from past reserves and leaving less for the future.

The Government has also explored other sources of revenue, and still needs to raise the GST, he said.

Why increase GST now?

The Government had considered the GST hike carefully and decided that it was necessary to do so, given how Singapore’s economic challenges are not just near-term or cyclical in nature, Mr Wong said.

The ongoing war in Ukraine, disruptions to energy and food supplies, rising geopolitical tensions and more fragmented supply chains are realities Singapore has to deal with possibly for a more prolonged period, he added.

“International economic conditions have fundamentally changed,” he said.

While inflationary pressures here are expected to ease in the second half of next year, inflation rates are unlikely to go back to what they were over the past decade, he added.

It is for this reason that the Government has extended comprehensive support to Singaporeans, especially lower and middle income families.

Mr Wong had at the start of the debate announced a $1.4 billion boost to the support package for households to offset the GST hike’s impact, amid higher inflation. This means the Assurance Package, first announced in 2020, will now be worth $8 billion, up from $6.6 billion before.

Responding to a point Mr Chua made on how households’ annual expenditure will increase due to inflation, Mr Wong said that the support they get will increase.

Mr Chua had cited the example of a middle-income couple with two young children, and estimated that with inflation, their annual expenditure would go up by $2,500.

Mr Wong acknowledged the rise in spending, but pointed out that the support they get this year would be around $1,500.

This support will keep to the Government’s commitment to offset more than half of the inflation-driven increase in cost of living this year for middle-income households, he said, adding this does not take into account wage rises for individuals which many will likely enjoy.

Associate Professor Lim had also cited how Japan saw an increase in inflation after it increased its version of the GST three times in the past 25 years.

Mr Wong pointed out that Japan was in a deflationary environment, and had raised the GST and had its inflation double from a “chronically low” 1 per cent to 2 per cent - and temporarily.

“Let’s avoid raising these alarmist examples that may not be so relevant to our context,” he said, adding that Singapore must continue to learn the right lessons from others.

He noted that while there are considerable uncertainties in the economic outlook, there is nothing uncertain about government expenditures, especially in healthcare.

Noting that MPs like Mr Liang Eng Hwa (Bukit Panjang), Mr Sharael Taha (Pasir Ris-Punggol GRC) and Ms Joan Pereira (Tanjong Pagar GRC) had made this point, Mr Wong said even as Singapore deals with healthcare spending, it has to resource many other spending needs.

These include planned investments on early childhood education, efforts to uplift lower wage workers as well as helping to ease concerns of SMEs, self-employed persons and those keen to purchase HDB flats.

“It’s a few billion here, a few billion there, they all add up. None of these needs has become less urgent because of the global economic situation. On the contrary, we must do more, especially in an uncertain and volatile environment,” said Mr Wong.

“That is why having considered this so carefully before the Budget, after the Budget, even in the last few months when the global economic environment had deteriorated, we felt that there was no possibility for us to delay the GST increase any further.”

Why not try alternatives to the GST hike?

Mr Wong also addressed four alternatives to the GST hike that WP MPs had raised.

One, the suggestion that Singapore has enough fiscal surplus to delay the hike of 1 percentage point set for January 2023.

Mr Wong said: “I wish that were so.”

He noted Prof Lim had suggested the Government is shielded from inflation because when inflation goes up, so does its revenues as prices also increase.

“But he didn’t mention this: Government spending must also go up correspondingly,” said Mr Wong, citing public servants’ salaries and support schemes for residents.

He added that while the Government collected more revenue than expected in the last financial year and had a surplus of $1.9 billion, it had already used this surplus as well as the return from the first half of this year to fund two support packages.

In June and October 2022, the Government announced two $1.5 billion support packages targeting lower-and-middle income Singaporeans.

Mr Wong said: “The bottom line is that any surpluses are imaginary - they are not there and will not allow us to delay the GST.”

Two, there have been suggestions to use more of Singapore’s reserves, including increasing the proportion used from returns on investments and changing the definition of land sales revenues.

Mr Wong said WP’s position, which it said was not raiding but slowing down the rate of accumulating reserves, sounds attractive but will leave future generations with less resources.

Such a move would be irresponsible, he added. “Let’s not succumb to the temptation of taking this easy way out, making things worse for our children and grandchildren.”

Mr Wong noted that global uncertainties are also likely to slow the growth of Singapore’s investments anyway, making tapping on these to delay a GST hike even more untenable.

Three, Prof Lim had suggested exempting essential items from GST, a point that had been raised by Ms He Ting Ru (Sengkang GRC) at the Budget Debate in February.

Mr Wong said this does not work in practice.

Such tiered GSTs are cumbersome, he said, citing a recent BBC article about India’s system.

In August, an Indian firm making pizza toppings went to court claiming their mozzarella topping should be classified as cheese - which had a GST of 12 per cent.

The court disagreed, arguing that because the topping had other ingredients such as vegetable oil it should be taxed at 18 per cent in a class known as ‘edible preparations’.

Mr Wong said there is no end to these challenges, and such tiered systems are not effective.

“When you exempt a basket of goods or essential items in the end you benefit the well-to-do, because the well-to-do will spend more on everything, not just luxury items but basic necessities as well,” he said.

This was a conclusion also reached by studies from numerous governments and the Organisation for Economic Co-operation and Development (OECD), he added.

Mr Wong said Singapore’s GST system - with its series of offsets and rebates - is deliberately designed to be fair and effective, contrary to Prof Lim’s view that these were a patchwork of offsets.

Four, suggestions continue to be made that Singapore should explore other streams of revenue such as property, income, corporate and sin taxes.

Mr Wong said while these have been carefully considered, the sums do not add up.

Increasing corporate and income taxes could result in investors leaving Singapore, especially amid tight global competition for talent and investments, he said.

He added that GST revenue alone is in fact not enough to fund policies the Government wants to push through, from healthcare spending to improving conditions for low-wage workers.

“Really, that question is not GST or these other alternatives - we need GST, and these other alternatives,” he said.

Mr Wong added: “The WP is entitled to your own position. By all means, oppose the GST, adopt a different position, fine.”

“But at least be honest and responsible, acknowledge that your alternatives would either end up requiring the middle income to pay more or would use more of the past reserves.”

Cost of Living: $1.5 billion support package to help Singaporeans cope with inflation; 2.5 million people to get up to $500 cash in December 2022

$1.5 billion Support Package builds on the support measures announced in Budget 2022, April 2022 and June 2022

By Hariz Baharudin and Goh Yan Han, The Straits Times, 14 Oct 2022

A new $1.5 billion support package will give Singaporean households additional help to deal with rising prices, with more aid going to lower to middle-income groups, Deputy Prime Minister Lawrence Wong announced on Friday.

Some 2.5 million eligible adult Singaporeans will receive a special cost-of-living payment of up to $500 in December, as part of the package.

They will get the payment together with the Goods and Services Tax (GST) Assurance Package cash payout that was announced at Budget 2022 to offset the impact of the upcoming one percentage point hike in GST from 7 to 8 per cent on Jan 1, 2023.

Every Singaporean household will also get additional Community Development Council (CDC) vouchers worth $100 next January. This means that together with the $200 CDC vouchers announced during the Budget this year, a total of $300 of such vouchers will be given out then.

The Ministry of Education will also increase the income eligibility thresholds for financial assistance schemes to defray school expenses for more students from January 2023. It will also enhance the bursary quantum for full-time Institute of Technical Education (ITE) students.

Mr Wong, who is also Finance Minister, said the latest measures have been designed with two groups of Singaporeans in mind who have been affected by higher inflation - lower-income Singaporeans and elderly retirees with no income from work.

Those earning less would be more disproportionately impacted because their wages may not rise sufficiently to cope with higher prices, said Mr Wong, adding that the older retirees would also be negatively impacted because they do not have incomes and have to deal with higher prices.

“That is why we have been monitoring the situation with respect to these different segments of Singaporeans, and the additional spending that they will have to incur,” he added.

The latest support package, together with earlier measures announced at the Budget as well as in April and June 2022, will fully cover the increase in cost of living for lower-income households on average, said the Ministry of Finance (MOF).

The package will also fully cover more than half of the increase in cost of living for middle-income households on average this year, the ministry added.

Full year inflation for 2022 is expected to come in at 6 per cent, Mr Wong said.

The Monetary Authority of Singapore had, earlier on Friday, said there was considerable uncertainty around the outlook for both inflation and growth, with core inflation set to remain high in the first half of 2023.

MOF said more support will also be given to help people deal with rising transport costs.

On Wednesday, it was announced that the Government will provide an additional subsidy of about $200 million to cover the 10.6 per cent fare increase that will be carried over to future fare review exercises.

"This additional subsidy helps to mitigate the impact of the fare increase on commuters and pay for higher costs of providing public transport services due to the increase in energy prices, manpower costs and inflation," said MOF.

Additionally, 600,000 public transport vouchers worth $30 each will be given to eligible Singaporean households, which can be used to top up fare cards or buy public transport concession passes.

MOF said there will be no draw on past reserves for the new support package. It will be funded by the better-than-expected fiscal out-turn in the first half of this financial year, which began in April.

The ministry added that the Omicron variant of Covid-19 was milder than expected, enabling more sectors of the economy to open up in tandem, boosting the nation's economic recovery.

The support package comes amid rising inflation, it noted. While supply chain frictions have eased slightly, the ongoing conflict in Ukraine and geopolitical tensions continue to put pressure on the prices of goods and services.

"As a small, open economy, Singapore is particularly susceptible to imported price pressures, through channels such as food and energy. Domestically, a tight labour market continues to support strong wage growth," said MOF.

"As such, we must be prepared for inflation to stay elevated for some time."

On Friday, Mr Wong also said that there will be an update to the GST Assurance Package, in order to take into account higher than expected inflation.

Details on these changes will come in Budget 2023, and Mr Wong stressed that the Government is fully committed to cushioning the impact of the GST increase for all Singaporeans.

The GST rate will increase by one percentage point from 7 to 8 per cent on Jan 1, 2023, and by another percentage point to 9 per cent on Jan 1, 2024.

May Day Rally 2022

Singaporeans must be prepared for more economic challenges in the year ahead, says PM Lee Hsien Loong

By Justin Ong, Political Correspondent, The Straits Times, 1 May 2022

Singaporeans must be prepared for more economic challenges in the year ahead even as the Government does all it can to cushion the impact of the Russia-Ukraine war, especially on the cost of living, said Prime Minister Lee Hsien Loong on Sunday (May 1).

"The fundamental solution... is to make ourselves more productive, to transform our businesses, to grow our economy, to uplift everyone," he noted. "Then our incomes can go up, and that can more than make up for higher prices of energy and food. Then we can all become better off in real terms."

PM Lee was addressing unionists at the May Day Rally at Downtown East, with some attending the hybrid event virtually.

In his speech, he outlined the Government's measures to alleviate cost-of-living pressures on Singaporeans. These include the $560 million Household Support Package announced at Budget 2022, which comprises U-Save and service and conservancy charges rebates and Community Development Council vouchers to reduce living expenses for nearly all households - with lower- and middle-income households receiving more.

The Monetary Authority of Singapore has also tightened monetary policy to reduce imported inflation, leading to the Singapore dollar appreciating.

Singapore is also taking steps to secure its own food and energy supplies, in the event of these being disrupted by the ongoing Russian invasion of Ukraine, which started on Feb 24.

"All this will help, but we must be prepared for more economic challenges in the year ahead," said PM Lee, pointing to inflation remaining high and central banks in developed countries tightening their monetary policies and raising interest rates.

"Global growth will be weaker, and there may be a recession within the next two years," he warned. "We have to face up to these realities."

Singapore, with its tight integration in the global economy and small size, will always be a price taker when it comes to world markets, said PM Lee. "We have very little bargaining power. If the prices go up, our prices go up. If supplies are short, we are squeezed. We cannot avoid these global headwinds."

Noting that Singapore imports nearly all its supplies of energy, he said that the doubling of oil prices in recent months has come at a cost - to households, businesses and the Government - of around $8 billion, as estimated by the Ministry of Trade and Industry.

He added: "There are limits to what Singapore can do to influence broader international trends. We will push back against deglobalisation. We will speak up to encourage the US and China to constructively engage each other.

"But ultimately, all these matters depend on the major powers themselves, and the relations between them, and how the war in Ukraine unfolds."

Said PM Lee: "We have speaking rights, but we are a small voice. Singapore has to take the world as it is, and develop a strategy that works for us in this troubled environment."

Turning inwards, relying heaving on domestic markets and producing more things onshore is a viable strategy for larger countries - but this is "not a choice open to Singapore", he said.

“Our strategy can only be one - and that is to stay open, to make our economy stronger, more resilient, and to keep on seizing opportunities for growth, developing new capabilities and becoming a more competitive economy,” said the Prime Minister.

"Because if we do that, then despite the uncertain climate, despite the pressures against globalisation, investors will still find it worthwhile to put their projects in Singapore, our exports will still find foreign markets, and we can still earn a living for ourselves in the world."

Lawrence Wong to lead PAP's 4G team, paving way for him to be Singapore's next Prime Minister

Humbled and grateful for the trust and confidence: PAP's new 4G leader Lawrence Wong

By Zakir Hussain, Political Editor, The Straits Times, 14 Apr 2022

Finance Minister Lawrence Wong has been selected to be the leader of the ruling People's Action Party's (PAP) fourth-generation (4G) team, paving the way for him to be Singapore's next prime minister.

Cabinet ministers affirmed their choice of Mr Wong, 49, as the leader of the 4G team on Thursday (April 14), Prime Minister Lee Hsien Loong said in a statement.

This decision was then endorsed by all government MPs in a party caucus, added PM Lee, who is secretary-general of the PAP.

The statement comes a year after Deputy Prime Minister Heng Swee Keat, 61, announced he had decided to step aside as leader of the 4G team, to pave the way for a younger person with a longer runway to lead the country when PM Lee retires.

At the time, the 4G ministers had asked for more time to reach a consensus on their next leader, as the country was still battling the Covid-19 pandemic.

But with the pandemic situation having stabilised recently, they were able to relook the issue of succession.

Giving details of how the decision was reached, PM Lee said that after consulting the ministers, he asked former minister Khaw Boon Wan, a former PAP chairman, to start a process involving the ministers, as well as Speaker of Parliament Tan Chuan-Jin and NTUC secretary-general Ng Chee Meng, both former 4G ministers.

"Mr Khaw met each one of them individually, to sound out their personal views in confidence and to facilitate a new consensus on a 4G leader. The views of the Prime Minister and the two Senior Ministers were not sought," the statement said.

"Mr Khaw found that the overwhelming majority of those consulted supported Minister Wong as the leader."

Earlier on Thursday, Mr Khaw briefed Cabinet ministers, as well as Mr Tan and Mr Ng, on his findings, and all endorsed the decision for Mr Wong to lead the team.

This decision was subsequently presented to and endorsed by PAP MPs in the evening.

The statement also said PM Lee will make adjustments to Cabinet appointments and these will be announced in due course.

"This decision on succession is a crucial one for Singapore. It will ensure the continuity and stability of leadership that are the hallmarks of our system," PM Lee said in a Facebook post.

"The right to lead is not inherited. It has to be earned afresh by each generation of leaders. Singapore will always need a strong team in charge, with a leader who can bring others together, and draw out the best of each team member," he added.

"I have every confidence that Lawrence and his team will continue to give their best for Singapore and Singaporeans."

Mr Wong is a co-chair of the Multi-Ministry Taskforce on Covid-19 and was appointed to the key finance portfolio in the last Cabinet reshuffle in May 2021.

He was a senior civil servant before he entered politics in the 2011 General Election, and became Minister of State for Defence and Education. He was appointed Acting Minister for Culture, Community and Youth in November 2012 and promoted to full minister in May 2014.

He became Minister for National Development in 2015, took on an additional appointment as Second Minister for Finance in 2016, and was made Education Minister after the 2020 General Election. He became Finance Minister in May 2021.

Mr Wong said in a Facebook post that he was humbled and grateful for the trust and confidence of his colleagues, who have chosen him to lead them, and for the support of his fellow MPs.

"From the very beginning in 1959, our model of political leadership has never been about one person, but the team. Each of us contributes, complements each other, and gives our best to Singapore," he said.

"My colleagues in the 4G leadership have stood shoulder to shoulder with each other in the fight against Covid-19. The experience of the past two years has cemented our cohesiveness and strengthened our resolve to steward Singapore safely through this crisis and beyond."

He added: "It is my privilege to be called upon to lead this team. I will do my utmost to uphold this responsibility. But as we have been reminded many times, the right to lead cannot be inherited. Together with the rest of the 4G team, I will continue to serve Singaporeans wholeheartedly, and strive to earn the trust and support of each and every one of our fellow citizens."

Education Minister Chan Chun Sing said he looked forward to continue working closely with Mr Wong and the team, adding that many geopolitical and economic uncertainties and social challenges remain.

“The 4G team will continue to work closely together with Singaporeans to improve their lives while seizing opportunities to leave behind a better Singapore for future generations,” he said.

Health Minister Ong Ye Kung said he had witnessed Mr Wong’s dedication and commitment to Singapore and Singaporeans, adding that he puts his heart and soul into what he does, and is never a seeker of credit or fanfare.

“The 4G team, now led by Minister Lawrence Wong, will continue to put Singapore and Singaporeans at the heart of every decision we make. I will do my utmost to support him, and look forward to be part of his team,” he added.

Observers said Mr Wong’s communication skills, seen in his delivery of his maiden Budget speech in February, gave him an edge.

DPM Heng said: “It was not an easy Budget to deliver, but he did so with verve, steadiness and a sense of fairness.”

He added: “I have found him to be a leader who considers things carefully, is able to bring people together, and has conviction to do what’s right for Singapore.”

Lawrence Wong clear choice to helm PAP's 4G leadership, with 15 of 19 stakeholders backing him

By Warren Fernandez, Editor-in-Chief, The Straits Times, 16 Apr 2022

The choice of Mr Lawrence Wong to helm the People's Action Party's fourth-generation (4G) leadership was made by an "overwhelming majority" of those involved, and this was subsequently endorsed by its top leaders and all its MPs.

This process of forging a consensus on who should lead the party, and Singapore, should the PAP win the next general election, was undertaken in a systematic and thorough way, to allow for candour, introspection and objectivity, and to help forge unity and support for the outcome.

Mr Wong, 49, emerged as the top choice of 15 out of the 19 stakeholders involved.

The 19 were all the Cabinet ministers, excluding Prime Minister Lee Hsien Loong and the two senior ministers, and included Speaker of Parliament Tan Chuan-Jin and NTUC secretary-general Ng Chee Meng, both former 4G ministers.

Each of the 19 was interviewed separately by former PAP chairman Khaw Boon Wan over the past month after the Budget debate in March. They were asked for their preferred choice - other than themselves - and had to rank potential candidates in order of their preference.

None of the other names garnered more than two votes, said Mr Khaw, indicating a clear majority of 79 per cent for Mr Wong.

This was more than a super-majority, he added.

Details of the vote were disclosed at a media conference held at the Istana on Saturday morning (April 16). It was chaired by PM Lee and attended by Mr Wong and Mr Khaw, to elaborate on Thursday's announcement of the party's choice of its next leader.

PM Lee said this was a major step forward in the political succession process, which he felt could not be delayed much further, as the uncertainty was not good for the country, given the many challenges ahead.

Now that the 4G choice was made, he would discuss with Mr Wong the timeline and next steps, with a view to handing over when Mr Wong and the 4G team are ready. This process would be done "carefully and deliberately", he said.

He would discuss with Mr Wong and decide later what was the best strategy for the PAP to contest the next election, which is due by November 2025.

This might include handing over to Mr Wong and his team ahead of the polls to allow them to contest and seek a fresh mandate from the electorate. Alternatively, PM Lee could lead the PAP team to fight the election, and if the PAP wins, Mr Wong would step up as PM some time thereafter.

"It will depend on how things evolve, it's something which we'll decide later on. But either way, our plan is for Lawrence to be the next PM, if the PAP wins the next GE. That has been settled.

"And the reaction from the public over the last two days shows that many people are happy we have taken this decision, and are happy with the decision."

This process of forging a consensus around the next leader was important, he added, since as first among equals in the Cabinet, the PM must have the support of his ministers, who bear collective responsibility for their decisions.

"Otherwise, the Government cannot function," said PM Lee, adding that the process was to pick the 4G leader, not his deputy or a 5G leader. It would be up to Mr Wong to pick his choice of deputy and his team later.

"To be effective as a PM, he must be able to trust and rely on his ministers, and his ministers must also be team players, supporting the PM, their PM, and supporting the team. And they all have to help the team to score goals collectively for Singapore."

For his part, in his first public outing since Thursday's announcement, Mr Wong said that he would work hard, together with his colleagues, to continue to win and earn the trust of Singaporeans.

He noted 4G leaders had already taken a “first step” in a multi-year plan to renew and strengthen society’s social compact in this year’s Budget, and would comprehensively review policies to see what more could be adjusted and improved.

“So, this would be a major agenda for the 4G team,” he said. “But beyond that, we will as a team continue to work hard to win the trust and support of every Singaporean, to create bonds and connect with them, and to develop new ideas that will resonate with Singaporeans, and especially with a new generation of Singaporeans."

He added: "I fully recognise the growing diversity of experiences and perspectives amongst Singaporeans, and I would like every Singaporean to know and feel that they will always have a stake in our society, even as we chart our new way forward together.

"And as leader of the team, that will be the approach, the attitude and the spirit I will adopt."

Acknowledging that he had his work cut out for him as he embarked on "possibly the biggest responsibility of my life", he added that he was "under no illusions about the demands of the job".

"It will get more challenging with greater political contestation and the growing desire for diversity in Parliament.

"And as PM said in Parliament recently, we do not assume that the PAP will win the next general election. Every GE from now on will be about which party will form the Government, not just how many seats the opposition wins or what percentage of the votes the ruling party gets.

"Knowing full well that we will have to earn the right of leadership, I will continue with the same principles that have guided me all these years, which is to give of my best, to engage and listen, and to learn and improve continually."

More support, earlier roll-out of Budget 2022 measures

Singaporean households to get $100 CDC vouchers, other support measures earlier amid rising prices

By Goh Yan Han, Political Correspondent, The Straits Times, 4 Apr 2022

More support is on the way for households given the economic impact of the conflict in Ukraine, and some Budget measures will be rolled out earlier, Finance Minister Lawrence Wong told Parliament on Monday (April 4).

He noted that the war has contributed to a further spike in inflation around the world and other factors, such as supply chain issues, have contributed to rising prices.

As such, the $100 worth of Community Development Council (CDC) vouchers for 2022, which was announced in this year's Budget, will be given out to every Singaporean household by the middle of May, said Mr Wong.

This comes after the first tranche of $100 CDC vouchers for all Singaporean households was disbursed four months ago last December to help Singaporeans with their daily expenses.

Mr Wong said: "I understand the concerns that many households and businesses have about the current situation... Where possible, I will bring forward the implementation of our Budget measures."

More financial support is also on the cards for lower-income households that will be more impacted by the higher prices during this period.

All new ComCare short- to medium-term assistance applicants between April and September 2022 will be given at least six months' worth of support from the social service offices, said Mr Wong.

Households that are already on this assistance scheme can also have their assistance extended for at least another three months if they need more help.

Lower-income households will also get more help with their public transport fares.

Mr Wong also announced another round of public transport vouchers worth $30 for more than 30,000 ComCare recipients.

These vouchers had been made available last December to help households cope with the public transport fare hike.

This group will hence receive $60 worth of the vouchers in total, which will roughly cover the additional fares paid by a family of four this year following the fare hike last December.

These vouchers are also available to all households with a monthly income per member of up to $1,600. Applications are open from now to Oct 31, 2022. Eligible households who had already received the first voucher, and who need a second voucher, can also apply again, said Mr Wong.

Mr Wong also announced that to help businesses, he will bring forward the disbursement of the Small Business Recovery Grant, which provides up to $10,000 for small- to medium-sized enterprises most affected by Covid-19 restrictions over the past year.

Most eligible businesses will be able to receive the grant by June, he said. Originally, eligible businesses for the grant would have been notified from June 2022.

The finance minister was responding to MPs who had asked if the Government would be enhancing the support measures announced in the Budget.

"We will need time to allow these measures to take effect and feed through the economy, before we can monitor their impact, assess the overall situation and then consider what additional steps we might want to take," he said.

Mr Wong also noted that the Budget had included rebates for service and conservancy charges (S&CC) and utility bills for households.

The first tranche of S&CC rebates and U-Save rebates to eligible households will be disbursed this month, and the rest will be disbursed in the coming quarters.

"This will address a key cost of living component which several members asked about," he said.

Other measures in place include the Covid-19 Recovery Grant to help those experiencing job loss or sustained income loss - available till the end of the year - and the Taxi Subsidy Scheme for lower-income persons with disabilities who require point-to point services to commute.

Mr Wong said: “If the situation worsens and more support is needed, the Government stands ready to do so.”

Why school exams exist and what we can do about them

Budget 2022 debate: Providing more pathways to support students' aspirations

Education system changes in line with push to encourage students to pursue strengths

By Amelia Teng, Education Correspondent, The Straits Times, 12 Mar 2022

Nearly every year, there are calls to scrap the PSLE.

This year was no different. Ms Denise Phua (Jalan Besar GRC) and Progress Singapore Party Non-Constituency MP Hazel Poa each suggested during the debate on the Ministry of Education's (MOE) budget on Monday (March 7) that the PSLE be replaced with through-train programmes.

Instead of the standard explanation that the PSLE remains a necessary checkpoint for students to gauge their learning after six years of schooling, Education Minister Chan Chun Sing went back to basics.

He raised several fundamental points that policymakers and educators have been thinking hard about in recent years, as MOE unveils changes to an education system that has for decades been known for its highly competitive nature and focus on academic results.

These include a PSLE scoring revamp and abolishing the Express and Normal stream labels, allowing students to take subjects according to their strengths.

In a lengthy response, Mr Chan made clear that the stress brought about by any major examination is unavoidable. Nor is it the aim of the MOE to remove all pressure for students.

What society can do is to change its perspective of exams and tests, and parents must first take a deep hard look at four basic questions raised by Mr Chan - why we test, how we test, when we test and what we do with the test results - to understand why exams cause so much anxiety.

Critics say that the changes by MOE do not go far enough to make any real impact, but based on previous polls, many parents hesitate to say that the PSLE should be postponed or scrapped.

In short, there is little consensus on what to do with the PSLE.

The same goes for mid-year exams, which schools had dropped for several levels in previous years, and will remove for all students by next year.

It was one of the plans announced by the MOE on Monday, to bring back the joy of learning and focus less on grades.

Most students will be relieved to have one less major exam to sit, and hopefully they will really be given more space to pursue other interests.

But the question is whether old habits die hard. The move would be in vain if parents and teachers feel it is too risky and end up replacing the mid-year paper with smaller but many more forms of assessments in school or at home.

Parents are also left wondering how exactly schools will implement the changes, and if it means a year-end exam that will carry more weight, which might just mean that the pressure builds up towards the end of the year.

A more porous system, for life

While the PSLE is here to stay, the message is clear - a pupil will not be labelled Normal or Express by his results, especially with the complete dismantling of the academic streaming system by 2024.

In its place will be full subject-based banding, in which students take subjects at varying levels of difficulty based on their aptitude for relevant subjects.

MOE is seeking to support students' aspirations through more bridges and ladders across the education system.