Replenishing Reserves Drawn During COVID-19 Crisis and Impact on Taxes Imposed on Singaporeans

Parliamentary Question by Mr Lee Hong Chuang:

To ask the Prime Minister and Minister for Finance (a) what plans are in place to restore the reserves drawn down during the COVID-19 crisis amid the ongoing global uncertainties; (b) what is the expected timeframe for replenishment of the reserves drawn; and (c) whether this process will involve any increase in taxes or reduced essential public services for Singaporeans.

Parliamentary Reply by Second Minister for Finance, Ms Indranee Rajah:

Between FY2020 and FY2022, Singapore drew about $40 billion from the Past Reserves to support COVID-19 measures to safeguard Singaporeans’ lives and livelihoods during the crisis. 

We do not expect to be able to put back the amount drawn from the Past Reserves during COVID-19. As previously explained by the Prime Minister in the debate on the Budget Statement 2025 in response to a similar query by Ms Tin Pei Ling (then the Member for MacPherson), this is because we expect our spending to increase in the coming years, and we will have to deploy our fiscal resources to meet this increased expenditure in order to keep within our means and maintain a balanced Budget over the medium term.

We will nevertheless continue to be responsible and prudent with our finances, and any surpluses accumulated at the end of the term of Government will be protected as Past Reserves. 

In light of the foregoing, the matters in paras (b) and (c) of the Member’s query do not arise for answer.