More social welfare schemes on the cards as new government takes power

Future budgets will focus on income distribution.

Singapore’s newly-elected government is expected to stick to its strategy of enhanced social welfare safety nets, after the ruling People’s Action Party (PAP) booked a sweeping victory in the recently-concluded General Elections.

DBS analysts expect that social redistribution measures will continue in coming years, following a marked shift towards income redistribution in the 2015 Budget.

“Future budgets will continue to focus on income distribution to ensure that all Singaporeans benefit from growth. This could include continued enhancement to the social safety nets via further increase in expenditure/subsidies on education, healthcare, and public assistance schemes,” DBS said.

DBS expects very slight policy refinements because measures are already in place to address hot-button issues such as costs of living, housing, education, medical care, transports, jobs, income divide, CPF and influx of foreigners.

“While refinements and adjustments can be expected from time to time going forward, it is unlikely to see a marked shift in policy direction in these areas given the strong mandate. Measures to tackle the challenges of an aging population can be expected while the tax regime will remain progressive,” DBS noted.