Before I do so, I would first like to recap on the FY2000 Budget and touch on changes made to improve the presentation of the Budget in the Budget Book.

When I presented the FY2000 Budget to the House last year, operating revenue was estimated at $31.4 billion and total expenditure at $29 billion, yielding a budget surplus of $2.4 billion.

However, last year's GDP growth of 9.9 percent exceeded all expectations. As a result, revenue growth has turned out to be much stronger. On the other hand, total expenditure is expected to be about $1 billion lower at $28 billion. The lower expenditure is due to reduced development spending, partly offset by unforeseen compensation payments to Singtel and Starhub. In addition, last year, Government also announced several surplus sharing measures totalling $1.8 billion which included the CPF Top-up, the Medishield Scheme for the Elderly and contributions to the Eldercare Fund and the Lifelong Learning Endowment Fund.

Taking into account all these changes, a budget surplus of $3.5 billion is now forecast for FY2000. However, this budget surplus cannot be directly compared with the forecast made in February last year because of several changes made to the presentation of the FY2000 budget. I will now explain the rationale underlying these changes.