The Singapore Government operates on a balanced budget over each term of Government. It also has a strong balance sheet that has assets well in excess of its liabilities.
The Government does not borrow* to fund its Budget. Under the Government Securities Act, the Singapore Government cannot spend the monies raised from three existing domestic debt securities it issues: Singapore Government Securities (SGS), Special Singapore Government Securities (SSGS), and Singapore Savings Bonds (SSB).
SGS are marketable debt instruments issued for purposes of developing Singapore's debt markets. They provide a risk-free benchmark against which other risky market instruments are priced off.
SSGS are non-tradable bonds issued specifically to the Central Provident Fund (CPF) Board, Singapore’s national pension fund. Singaporeans’ CPF monies are invested in these special securities which are fully guaranteed by the Government. The securities earn for the CPF Board a coupon rate that is pegged to CPF interest rates that members receive.
SSB are non-tradable bonds issued to provide individual investors with a long-term saving option.
All borrowing proceeds from the issuance of SGS, SSGS, and SSB are invested. These investment returns are more than sufficient to cover the debt servicing costs.
More details of Singapore Government Borrowings are found here.
*Refers to borrowings through the Government Securities Act.