“President cites severe downturn, rapid decline of the economy and need for swift measures to restore confidence”
1. Severe downturn, rapid decline of the economy and need for swift measures are reasons WHY you need a FISCAL STIMULUS — these are not reasons WHY you need to DRAW-DOWN ON RESERVES.
2. “I used $300 of my savings to finance my iPhone purchase which cost $800. The other $500 came from last month’s paycheck”.
3. I bought the iPhone because it has great music features, is cool, has funky colours/design, etc. Hence all in, it’s great value for $800!! 
4. I used $300 of my savings because I didn’t have enough cash leftover from last month’s paycheck to buy it”.
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From the Straits Times 18 Feb 09 (Breaking News).
President cites severe downturn, rapid decline of the economy and need for swift measures to restore confidence
| By Sue-Ann Chia, Senior Political Correspondent | ||
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President Nathan at a press conference yesterday where he explained his decision to agree to a drawdown of reserves. He said there was interest during the Budget debate about the process of dealing with past reserves. — ST PHOTO: AZIZ HUSSIN
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PRESIDENT S R Nathan revealed yesterday why he agreed to the first-ever draw on past reserves, citing the severity of the downturn and the speed at which the economy was declining.
It took 11 days for the Government to seek and secure his in-principle approval, with Mr Nathan giving the nod just a day before the Budget was presented in Parliament on Jan 22.
The swiftness of the process, he said, stemmed from the urgency in giving the Government the confidence to roll out measures to tackle the recession which could worsen without fast action.
‘I recognised the importance of giving confidence to go ahead with the measures proposed in the Budget for the particular reference to past reserves bearing in mind (that) if the situation prolongs or worsens, negative consequences would have kicked in, making any measures too late to be of any effect,’ he told the Singapore media at the Istana.
He was making public for the first time his decision to allow the drawing down of $4.9 billion of past reserves to fund two schemes: a Jobs Credit scheme to subsidise wage costs in a bid to save jobs; and a Special Risk Sharing Initiative to give companies more access to credit.
Explaining the speed with which the decision was made, he said: ‘The urgency was quite evident, and I think 11 days was reasonable. If it had to be, it could have been shorter.’
Mr Nathan also said in response to questions that he need not have held a press conference to explain the decision. He is required only to convey his decision in writing to Parliament in response to the Government’s request.
But there was interest during the Budget debate about the process of dealing with past reserves, and questions of when past reserves can be used, he noted.
He made it clear that the steps taken to seek his approval did not bypass procedures and went by the book.
‘Whether you take 11 days or one month, the process will be the same,’ he noted. ‘If we had the luxury of time, we’d have taken much longer. But the circumstances were such, people’s confidence had to be restored.’
Read the full story in today’s edition of The Straits Times.
