Finance Minister Heng Swee Keat declared this afternoon that all Singaporeans above the age of 21 will receive an “hongbao” of $300, $200, and $100 depending on their income, this year. The Minister said that this one-off bonus “reflects the Government’s longstanding commitment to share fruits of Singapore’s development with Singaporeans.”
Delivering the budget speech for the year, the Minister said that the government will spend a total of 700 million on this “SG bonus”. This 700 million comes from the budget surplus of $9.6 billion or 2.1 per cent of the Gross Domestic Product (GDP) from FY 2017.
The remaining budget surplus will be saved for future spending.
Of the exceptional surplus, $5 billion has been set aside for the Rail Infrastructure Fund that will help pay for the new rail lines the government is building. Another $2 billion has been set aside for premium subsidies to help Singaporeans when the ElderShield review committee unveil their final recommendations.
The Government only forecasted a $1.9 budget surplus or 0.4 per cent of GDP for FY2017 a year ago and the Minister attributed the “exceptional” surplus of $7.7 billion to the recent property market pick-up.
The Minister noted that while this is good, “we cannot base our long-term fiscal planning” on exceptional factors such as these being positive each year.