Responsible stewards
Singapore must be “responsible stewards” in protecting reserves which were “painstakingly built up” over half a century by the pioneers.
The rules on reserves had been “enshrined” in the Constitution following parliamentary debates, Mr Heng pointed out.
The cap was deliberately introduced so that the government of the day “does not succumb to the temptation to draw more from our reserves to fund current expenditure, or eat into the principal sum”, he said.
Singapore must be “responsible stewards” in protecting reserves which were “painstakingly built up” over half a century by the pioneers.
The rules on reserves had been “enshrined” in the Constitution following parliamentary debates, Mr Heng pointed out.
The cap was deliberately introduced so that the government of the day “does not succumb to the temptation to draw more from our reserves to fund current expenditure, or eat into the principal sum”, he said.
To amend Constitutional rules as a 'first resort' in order to raise contributions from reserves to fund increasing expenditure is ill-disciplined and unwise.
Raising the 50 per cent NIRC cap or use a portion of land sale proceeds for recurrent social spending sounds very tempting because it is relatively painless to do compared to raising taxes.
But it is not the right thing to do, Mr Heng said.
Mr Heng urged MPs not to “give in to the temptation” of chipping away at strategic national assets.
“If as soon as we need more money, the first thing we do is relax the rules, that is the surest way to change Singapore’s basic orientation – from saving and building for the future, to living for today and letting tomorrow look after itself.”
An over-reliance on the NIRC will hurt the Republic’s ability to respond to changing circumstances in future, he said.
“We are stewards of the reserves for our future generations, as what our forefathers had been for us,” he said, stressing that Singapore must “uphold the discipline” in tapping the reserves in a sustainable way.
The world has changed much in the last century.
“As we now come into the 21st century, we are moving from a unipolar world to a multipolar one, with growing tensions between major countries and concerns about global and regional stability.”
In the aftermath of a financial or geopolitical crisis, there are “usually many years of subsequent weak economic performance”, Mr Heng said.
Employment and economic output tend to fall for a sustained period, he said.
Raising the 50 per cent NIRC cap or use a portion of land sale proceeds for recurrent social spending sounds very tempting because it is relatively painless to do compared to raising taxes.
But it is not the right thing to do, Mr Heng said.
Mr Heng urged MPs not to “give in to the temptation” of chipping away at strategic national assets.
“If as soon as we need more money, the first thing we do is relax the rules, that is the surest way to change Singapore’s basic orientation – from saving and building for the future, to living for today and letting tomorrow look after itself.”
An over-reliance on the NIRC will hurt the Republic’s ability to respond to changing circumstances in future, he said.
“We are stewards of the reserves for our future generations, as what our forefathers had been for us,” he said, stressing that Singapore must “uphold the discipline” in tapping the reserves in a sustainable way.
The world has changed much in the last century.
“As we now come into the 21st century, we are moving from a unipolar world to a multipolar one, with growing tensions between major countries and concerns about global and regional stability.”
In the aftermath of a financial or geopolitical crisis, there are “usually many years of subsequent weak economic performance”, Mr Heng said.
Employment and economic output tend to fall for a sustained period, he said.
“To be clear, we prepare for the future not only within our own lifetime, but our children’s and children’s children… we must do our best to give them the best chance of a better life, whichever way the winds of change blow,” he said. “What we have inherited from the past, we also owe to the future. That is our moral obligation.”
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