Daily Lesson from Life 18 January 2009

"Govt may tap reserves

SM Goh said the PM and finance minister are considering doing so to pay for some of the measures in next week's Budget. -Sun, Jan 18, 2009 The Straits Times

THE Government is considering dipping into its reserves to help tide Singaporeans through the economic downturn.


Senior Minister Goh Chok Tong revealed on Sunday morning that the Prime Minister and Finance Minister are mulling over the possibility of dipping into the reserves to pay for some of the measures in next week's Budget.

Speaking to reporters after giving out hongbaos to the low income in his Marine Parade constituency, he said: 'The issue which the Prime Minister and the Minister of Finance is now thinking over, is whether we should go to President, and ask him for approval to use the reserves for extraordinary measures.' "

Reserves are built for rainy days. If the government feels that this is going to be a LONG downpours and not just any rainy days and ordinary Singaporeans are truly in dire straits and need help, then JUST go for it!

However, the reserves need to be accounted for in a very transparent manner. e.g. how did we build up the reserves from 2 years ago to now? what adds up and what minus away? how are we going to spend the reserves that we are going to take out for this extraordinary time - line by line for major expenses? how are we going to CONTINUOUSLY account to the populace on a quarterly basis the actual disbursement vs. budgeted amount? etc...

Lessons for me are:

1. it is a prudent practice to save for rainy days. When the time get really tough and the tough supposedly gets going, it is always great to have a reserve to back it up!!;

2. when the reserve belonged to the people, the leaders must account to them on how it gets built up and how the excess will get spent! In extraordinary time, we cannot be stingy with sharing information that will help people understand how the money is going to be spent. This will prevent suspicious and confusion and killed any unproductive rumours from spreading that disunite the people when we can least afford to!;

3. there must be clear objectives, deadlines and oversight established so that everyone knows this gate is opened for extraordinary period only and for a specific period. In addition, all efforts will be made to ensure that the disbursement take place as intended and on a timely basis. Also, each transaction will be accounted for by an independent and competent process and people so transparency is achieved!

I wish Singapore government all the best in pulling the nation out of this unprecedented crisis. If they do it right and galvanise the people to be with them as one, I am sure we can pull it off!

May the Creator bless Singapore!!