SINGAPORE – A total of $72.3 billion was spent from the public purse to tackle Covid-19 over the last two financial years.
Of this, $13.4 billion was used for public health measures, $50.6 billion was used to protect jobs through support for workers and businesses, and $8.3 billion for direct household and social support, Second Minister for Finance Indranee Rajah told Parliament on Tuesday.
This amount, spent over financial years 2020 and 2021, was lower than the $100 billion the Government had earlier committed due to two main reasons, said Ms Indranee.
The first reason was that the Government had initially set aside loan capital in financial year 2020 in anticipation of a tight credit market, but this was not needed.
This was because the Monetary Authority of Singapore had provided low-interest capital to participating financial institutions through its Singdollar Facility for Enterprise Singapore loans, she said.
The second reason was under-utilisation in public health spending. Resources were set aside to cater for “potential downside scenarios” that were averted due to safe management measures and Singaporeans’ cooperation.
However, such under-utilisation was offset by additional funding for support packages rolled out for Singaporeans and businesses over the heightened alert and stabilisation phases from May to November last year, said Ms Indranee, who was responding to questions by Ms Foo Mee Har (West Coast GRC).
For instance, the Jobs Support Scheme to subsidise the wages of local workers was enhanced for certain sectors where tightened measures required their activities to be suspended, including for gyms and arts education centres.
Deputy Prime Minister Heng Swee Keat committed almost $100 billion in Covid-19 expenditure across five Budgets in 2020 when he was finance minister. More than half of that amount had been expected to come from past reserves.
At this year’s Budget in February, Finance Minister Lawrence Wong, who is now also Deputy Prime Minister, said the total expected draw on past reserves for the three financial years of 2020 to 2022 would be $42.9 billion, less than the initial projected sum of $52 billion.
Meanwhile, public sector agencies will draw lessons from the Covid-19 pandemic and strengthen their financial practices during emergencies, said Ms Indranee.
Measures being adopted include using practical methods to assess whether prices during a crisis are reasonable, such as applying a percentage mark-up from non-crisis prices, or actual costs incurred by suppliers.
Another is ensuring proper documentation of key decisions – such as policy changes and approvals – across the life cycle of a transaction, as well as using data analytics to detect potential irregularities, she said.
The Ministry of Finance (MOF) has started a review of the controls and checks on pandemic-related procurement and expenditure since earlier this year, Ms Indranee said.
“Respective agencies are conducting their audits… to ensure transactions are bona fide and that there is no erroneous payment.”
This is on top of the Auditor-General’s thematic audit, she said. The Auditor-General’s Office’s (AGO’s) annual report for the 2021/2022 financial year was published in July.
The AGO said then that it had conducted a thematic audit on pandemic-related spending of three agencies: the Health Promotion Board, the Ministry of Manpower and the Singapore Land Authority.
The audit found that the three agencies generally had processes in place for procurement and contract management, but highlighted areas for improvement such as lapses in how agencies determined the price reasonableness of some contractors’ proposals.
“Drawing lessons from our Covid-19 experience and from the AGO’s report, MOF is reviewing our guidelines on procurement, contract management and payment to ensure our control measures are appropriate for future emergencies,” said Ms Indranee.
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MCI (P) 031/10/2021, MCI (P) 032/10/2021. Published by SPH Media Limited, Co. Regn. No. 202120748H. Copyright © 2021 SPH Media Limited. All rights reserved.