Bringing into Force Article 5(2A) of Singapore Constitution

The following question stood in the name of Assoc Prof Tan Kheng Boon Eugene –

To ask the Minister for Law (a) what are the reasons for not bringing Article 5(2A) of the Constitution into force given that the constitutional amendment was first passed in 1991; (b) under what conditions will the Government be ready to bring Article 5(2A) of the Constitution into force; and (c) whether the Government will instead bring into force Article 5(2A)(b) and Article 5(2A)(d) to entrench the constitutional provisions relating to fundamental liberties and general elections respectively ahead of the constitutional provisions entrenching the elected presidency.

Mdm Speaker, the 1991 constitutional amendments that created the institution of the Elected President were unique arrangements. We made fundamental changes to the law and procedure for Government, key statutory boards and key Government companies.

Given the complex and novel nature of the changes, it was not possible to anticipate all the possible consequences and operational details. The provisions have been amended, revised and fine-tuned along the way, as we gained practical experience working the safeguards. A summary of these various amendments is outlined in an Annex. Amendments were made in 1994, 1996, 1998, 2001, 2002, 2004, 2007 and 2008.

Mdm Speaker, with your permission, may I ask that a copy of the Annex be distributed to Members?

If I may continue, Mdm Speaker. The experience of the amendments shows that adjustments, modifications and refinements must be put in place, be fully ironed out, before the scheme can safely be entrenched. To bring Article 5(2A) into force before that would otherwise potentially trigger a national referendum each time we needed to make a further refinement or adjustment. Our view is that we should give ourselves more time, before entrenching the provisions.

In addition, in 2008, the Constitution was further amended to introduce a new Net Investment Returns framework, to improve the basis on which the Government can use the returns from investing our reserves for budgetary spending. This amendment gave us the fiscal space to meet increased spending needs, while protecting the reserves for future generations.

At present, Net Investment Returns Contribution makes a substantial contribution to our Budget – about 2% of GDP, or $8 billion per year. As I have explained to this House in 2009, the Government's intention was to operate these revised spending rules for a number of years, and consider entrenching them after that if no additional major changes proved necessary.

The current context is that our society is ageing quickly. Within the next 20 years or so, close to 1 million Singaporeans will reach retirement age. Over the last few years, the Government has made several major policy shifts which will significantly increase spending on infrastructure and social services, especially healthcare. Our healthcare spending alone is likely to increase three-fold, from $4 billion in 2011 to about $12 billion by 2020.

To pay for this increased spending, we will need to strengthen our revenue base. Over the next five to 10 years, we cannot rule out further refinements to our tax system and to the basis on which we draw on net investment returns for current spending. We cannot decide today precisely how this should be done. We must therefore preserve our ability to make necessary adjustments in due course, so that we can maintain Singapore's strong financial position, and our fair and progressive system of taxes and transfers.

For these reasons, it remains the Government's intention not to bring Article 5(2A) of the Constitution into force until the position is clearer.

Finally, the Member has also asked whether we can bring into force the entrenchment of the provisions relating to elections and fundamental liberties, in advance of the rest of Article 5(2A). The answer and the reasons why we cannot do so were explained to this House in February 2007. As the previous Minister for Law explained, the Attorney-General had advised the Government that, having regard to the provisions concerned, the

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implementation of Article 5(2A) cannot be staggered, as this would go against the intent that Article 5(2A) should operate as an integrated package.