Public finance
2019-20 financial year
- Deficit of about $37.8 billion, equivalent of about 1.3% of GDP
2020-21 financial year
- Estimated deficit of about $139.1 billion, equivalent of about 4.8% of GDP
- Almost $120 billion of deficit related to the cash payout scheme and other one-off relief measures, which will not incur long-term financial commitments
2021-22 to 2024-25 financial years
- Estimated deficits range between $7.4 billion and $17 billion
- Main reason is Government revenue cannot keep up with drastic increases in expenditure (especially recurrent expenditure)
Facing the challenge
- Future Government expenditure will enter a consolidation period
- For future spending increases, should be more mindful of long-term affordability and in line with increase in revenue
- To increase revenue, we need to maintain the growth and vibrancy of the economy, and identify new areas of economic growth
- May have to consider seeking new revenue sources or revising tax rates
- May have to reduce one-off relief measures progressively
