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SINGAPORE should have the fiscal room for a generous deficit in Budget 2025 – the final Budget of the government’s term – thanks to an expected “bumper” surplus for the 2024 financial year, said economists.

At least six banks have released estimates for the 2025 Budget deficit, ranging from S$3 billion to S$6.6 billion.

Under the Constitution, Singapore’s government must maintain a balanced Budget over its entire term. The current term began after the 2020 general election (GE) and runs from FY2021 to FY2025.

FY2021 and FY2022 saw surpluses, but these were mostly offset by a deficit in FY2023, noted OCBC chief economist Selena Ling. This means any surplus in FY2024 – from Apr 1, 2024 to Mar 31, 2025 – will essentially form the “fiscal headroom” for Budget 2025, she told The Business Times.

Prime Minister and Finance Minister Lawrence Wong will deliver the Budget statement on Feb 18, ahead of the upcoming GE, which must take place by November.