The Singapore government just announced the 2018 budget on February 19th 2018.
If you're new to this series, welcome! Here is where we take a look at SG budget data across the years from a data-centric viewpoint.
Rather than look at specific budget policy announcements for 2018, the aim of this series is to look at the data from a longer-term macro perspective across years.
I believe in data literacy. An informed citizenry makes better decisions and is good for Singapore.
This is the fifth year running that I've been doing this. Many of the visualizations were pre-written, so I just added the latest data figures from MOF.
Here's the work done in previous years, if you're interested to compare:
The whole point of this series is to give readers a sense of the long-term trends in the budgets.
If you want to embed the charts on your website or blog (media is more than welcome), please feel free to do so.
The first thing that should stand out is that 2017 was definitely a super bumper year in terms of surplus for our government.
Our government accrued a surplus of S$9.61 billion, which is more than any amount in the last 20 years.
In fact this surplus surpassed the projected surplus of $1.91 billion (about slightly less than fivefold) when the budget was announced last year. You can check the 2017 budget visualization to see this.
This is in part due to stamp tax collection (on our overheated private property market) but mostly due to fluctuating currency rates in our favour for 2017.
Something of interest is also that the government is projected to go into a $606 million deficit for FY2018, which is uncommon. In the last 20 years, we have only run a deficit 4 times thus far, and 2018 is the 5th.
Spending is expected to rise quite a bit, and yet revenues will not cover, leading to a projected deficit.
Immediately what should stand out is the increase in spending in transport for FY2018, from $8.98 billion in 2017 to $13.71 billion in 2018, an almost 50% increase year-on-year.
When you compare transport viz-a-viz spend with other sectors (toggle the percentage view), this becomes absolutely obvious that transport is going to eat up a sizeable chunk of the government budget in FY2018.
Side note: long-term across 20 years transport is one of the sectors with the biggest variance in spend.
Another key interesting sector is health. Ever since the early 2000s, this sector has been growing in terms of the budget pie viz-a-viz other sectors.
2018 is year in which health spending will actually fall for the first time in over 14 years. In total numbers compared to 2017 it is just a shortfall of S$250 million.
However this decline is noticeable, especially against other sectors that are growing like home affairs or social and family development, and also because of the misconception that spend on health will always rise due to our greying population.
For those who are not familiar with the data plot of this chart (especially when you toggle the percentage view), it is a comparison of expenditure spend against all ministries/sectors.
I feel that it is a more interesting way of looking at the budget data for it gives a sense of the priorities of where our government spends on what sector/ministries. For all percentages mentioned, do note that it is calculated as a spend across all sectors.
Expenditure by sector drilldown is a new zoomable packed circle visualization for this year.
In this chart, every ministry/sector can be drilled down all the way to see the difference in operational and developmental expenditure. Click outside the bubbles to go back a level.
It allows you to visually at a glance compare sector and ministry spend easily.
In the drilldown you will also notice differences across sectors. For example, big places where we traditionally spend on like education and defence are mainly in operational expenses.
As a contrast, transport spend for FY2018 is heavily in developmental expenditure.
For FY2017, it was a bumper year for the government.
One immediate item that jumps out is the bump in statutory board contributions, from $775 million in FY2016 to $4.86 billion in FY2017, a more than 600% increase year-on-year.
The bulk of this is from MAS (Monetary Authority of Singapore) from currency fluctuations, according to reports.
Stamp duty revenue also contributed significantly to this surplus, from $3.28 billion in FY2016 to $4.73 billion in FY2017 (a 44% year-on-year increase).
Even as stamp duties has been increased from 3% to 4% for properties worth more than $1 million as of 20th February 2018, the government expects the property market to cool in FY2018, and less stamp duties will actually be collected. Some experts disagree though.
The last time stamp duties were increased was in 1996, which was more than 20 years ago.
Although FY2018 is expected to remain bullish with global economic growth expected to be around 3.9%, there are potential headwinds and downside risks like inflation, protectionists stances on trade, etc.
According to the government's analysis, FY2017 was a once-off anomaly and hence in FY2018 there is an apparent decline as we are not projected to make this much again. Take out the MAS $3billion revenue for FY2017 and the projection falls into the more standard projected income stream.
A 10% rise in tobacco excise taxes will also raise revenues from $3.2 billion in FY2017 to an expected $3.37 billion in FY2018.
Other notable changes are an increase in foreign maid levy from April 2018 (you can see a projected increase in FY2018 for other taxes in the charts, which maid levy is under) and a new carbon tax set to start in 2020.
A last point on the GST rise from 7% to 9%, expected sometime between 2021 to 2025. GST currently is the 2nd biggest income generator for the government since 2004, but will be pipped just slightly by personal income tax in FY2018.
In 1994, when GST was introduced, it was 3%. This was raised to 4% in 2003, then 5% in 2004, and then 7% in 2007. You can see from the charts the shifts in 2003 and 2004 - it grew quickly and overtook personal income tax to be the number second revenue stream for our government.
With GST set to increase and corporate taxes trending downwards across 20 years of data, will a 9% GST in the early 2020s be the government's biggest revenue stream?
As always, the answer is more data, and we'll see about this in future years.