Singapore’s healthcare system will require significant investment as population ages, according to Budget 2022.
Finance Minister Lawrence Wong shared during the Budget 2022 announcement that government spending is projected to exceed 20% of GDP by 2030, with healthcare playing a pivotal role. Over the last decade, social spending nearly doubled from S$17 billion to S$31 billion, accounting for almost half of the annual budget. Wong highlighted that as Singapore’s population ages, the demand for healthcare and social care will rise, straining resources due to the declining working population. He stressed the need to reform the healthcare system to meet these evolving geriatric demands.
Wong further explained that it would not be appropriate to dip into national reserves to cover these costs, which are recurring rather than one-time expenses. The Net Investment Returns Contribution (NIRC) already provides significant revenue for public services, funding approximately 20% of each dollar spent. However, tax adjustments will be necessary to ensure a sustainable revenue model moving forward.
He also emphasized that the focus should not only be on spending more but on spending wisely to achieve effective outcomes while maintaining core values like personal responsibility and community support. Finally, Wong called for unity, urging Singaporeans to strengthen the nation’s social compact during these challenging times.
