The Singapore budget held many goodies. The centre piece pioneer generation healthcare benefits have been extensively revised to the tune of a S$8 (US$6.3) billion fund set aside for their healthcare needs for the rest of their lives.
MediShield for the unacquainted is the national health insurance plan for Singapore. This scheme will be extended to cover all Singaporeans and renamed MediShield Life as announced last year. While a good quarter of the older population (65 and over) had previously not been covered, this will now not just include them but also for the whole pioneer generation, outright cash subsidies to pay the premiums for the national healthcare insurance will be given and other subsidies or extensions given for outpatient treatment. This is to ensure it remains affordable. (Pioneer generation refers to Singaporeans from age 65 and above at the end of this year and having obtained citizenship from 1986 and earlier).
MediShield Life will cover all pre-existing conditions which is a marked change from Medishield. In other words, even if someone has for example had cancer before being covered and then develops another cancer after being in remission, a reasonably likely scenario given the nature of cancer, the patient can be covered under this revised insurance plan. Presumably coverage for say a second heart attack when the first had already been covered under this scheme is also in place.
While many of these measures had been floated or some details announced, the pulling together of all these in the context of the national budget while running only a small deficit shows Singaporeans that it is more than possible.
The age limit has also been lifted for MediShield Life which had previously only stretched to 90. This is a very significant step given it is no longer surprising to see in the obituaries pages, that people are now dying into their 90s and sometimes past 100. One might say however that perhaps their longevity is in itself a tribute to Singapore’s healthcare services. Other gaps, mental illnesses, congenital defects very importantly for instance are now being covered.
Other privately provided insurance policies sometimes do not even cover otherwise healthy children for simply being underweight even if all indicators show good health. So the assurance of having a national healthcare scheme that is universal must be very reassuring to many Singaporeans and not just the old but right across the board.
Aside from the generous definition of the pioneer generation and extension of the national health insurance scheme to a more universal basis, the Singapore budget 2014 is remarkable for not raising taxes generally.
In the run up to the Singapore Budget 2014 announcement, there was some speculation that with a pioneer generation package, taxes would have to be raised. After all, how are all these benefits to be paid for?
In particular, wealth, property and income taxes it was thought would be raised given the focus on inequality. However just as Singapore’s gini coefficient has fallen for the first time in four years, the Singapore government refraining from this step is not surprising, given that to attract companies to Singapore, and encourage workers, Singapore has generally kept a low income tax regime. (see: How Progressive are Singapore taxes? for previous years tax distribution.)
So the miracle of the Singapore budget 2014 is partly because this government has been efficient at making use of existing revenue and delivering a remarkably high degree of government services to Singapore’s population. The budget is therefore as much a tribute to the Singapore civil service as it is to the Minister of Finance.
The wage earning population must be heaving a sigh of relief. They must have not been the only group as as all the property owners particularly those with more than one property or luxury properties who were hit by higher property taxes must have been nervously awaiting the Singapore budget 2014 amid cries of a more inclusive society.
So perhaps this is truly a levelling up budget. Instead of taking down the wealthy or the high income earners down a peg or two or the property owners, the government has somehow pulled it off without raising income taxes for either corporates nor individuals, introducing property gains tax or other forms of wealth taxes in general thereby preserving the reward for working and husbanding one’s store of wealth, which had it been earned particularly by oneself, has already been taxed.
Three cheers indeed for the Singapore Budget 2014.
The only group that is almost certainly down in the dumps must be the drinkers of alcohol and smokers. Sin taxes have jumped, and by no small degree. Tax on liquor has risen by a whopping 25 per cent. Your little smoke must now not just be confined to those little yellow boxes at hawker centres or coffee shops but has become distinctly more expensive as tax on tobacco products has risen by 10 per cent. So the squeeze is on there on these but this is notably on little luxuries with have potentially adverse side effects if taken to excess.
While I would say, three cheers to Singapore budget 2015, I cannot offer the Finance Minister Tharman Shanmugaratnam, a beer to accompany those cheers as it is now a tad expensive. Instead, I would offer to buy him a healthy lunch at the food courts of say, Singapore General Hospital, which will deliver many of these subsidised health care services, where the food court operator too makes it a policy to encourage healthy living by making healthy choices.
Long live the Singapore Budget 2014 and the pioneer generation! Now let us hope parliament passes it post-haste and our good civil servants start rolling it out with their sterling efficiency. The pioneer generation cannot wait much longer.
Sharon has worked for the Singapore government in positions ranging from looking at the use of technology in tourism to political analysis of Asian countries. She cut her teeth as a journalist for one of the leading dailies covering local political news. She then spent a considerable number of years in the private sector with an investment and consultancy company specialising in the commercialisation of intellectual property. She holds degrees from Oxford University and the University of Illinois at Urbana-Champaign.