This COS, we sit together with the rest of the world, which is coming out of the COVID-19 pandemic. We have learned to live with the disease, and are returning to normalcy. But it is also clear to all of us that the world has changed – some things will never revert to status quo ante. Among them – hybrid work patterns, greater digitalisation, increased vulnerability of supply chains, and rising protectionism.
Many of you have spoken about the Russian invasion of Ukraine, and in parallel, that rising US-China tensions are seminal forces that will impede, if not unravel, globalisation. For Singapore, whose external trade is three and a half times our GDP, the proverbial "shop in the MRT station", the "canary in the mine of globalisation", so dependent on free flow of goods and services, capital and people – these changes are bound to affect us, and our country will feel the effects strongly.
There is also the potential of physical disruption to key Sea Lines of Communication. Mr Vikram Nair spoke on this. Mr Dennis Tan alluded to it. The South China Sea and the Straits of Malacca and Singapore are indeed vital waterways. A third of global shipping goes through the South China Sea, and the Straits of Malacca and Singapore and carries 80% of the oil transported to Northeast Asia.
Coupled with these external forces, internally, many countries see their citizens pushing against globalisation and immigrants. The rise in extreme right parties is a vivid sign of this inward-looking mood.
In sum, the post-World War II constructs of increasing free trade and open borders are under severe stress. President of the World Economic Forum Børge Brende recently described our world as one which is gradually sliding from a period of cooperation to a period of intensifying global competition.
China's accession into the World Trade Organisation (WTO), if we cast our minds back, was in 2001, where US President Bill Clinton spent political capital to get his Congress to support it. Why did the US do it? They wanted to speed up China's transition to a market-based economy, for it to be more globally integrated. As the thinking went, if China was more like the rest of the world, trading with it and co-dependent, then surely Communism as a form of government would be weakened. More than 20 years later, I suspect that some within the US and their Western allies, in retrospect, might think that was a mistake. Because China has indeed risen economically, and is now one of the largest trading nations. But just recently, Czech President-elect Petr Pavel asserted that China was "not compatible with Western democracies in their strategic goals and principles".
These forces run deep and will alter the very foundational pillars of countries and their relationships with others. It's inevitable, even for large and middle powers, let alone tiny Singapore. And many of you ask what these structural forces, what these tectonic plates will do to us.
Let's first look at Europe. For Germany, that long believed and worked for the integration of Europe and Russia, those hopes have all but evaporated. Germany downsized its Bundeswehr, its military, in the nineties, to reap the so-called "peace dividends" after the Berlin Wall fell. Today, it has to reverse that policy. Chancellor Olaf Scholz's Zeitenwende speech in 2022 marked, as the word means, the end of an era and a turning point. European Union (EU) countries have now pledged to spend more on defence in the face of Russia's war on Ukraine. Some, like Latvia, are also reintroducing conscription, while others like Germany, Sweden, Poland, and France continue to mull over the reinstatement of some form of national service.
Closer to home, Asian countries too are up-sizing their militaries, especially in Northeast Asia. China is estimated to spend in excess of US$270 billion, and announced a 7.1% increase last year. Japan has announced plans to double its defence spending to 2% of GDP by 2027, and to develop counter-strike capabilities. For the past decade, Japan's military spending, albeit as a self-defence force, has been on the same level as France's and Germany's, around US$50 billion every year. 2% of Japan's GDP would be around US$85 billion today. That is more than what India spends. South Korea wants to increase defence spending by an annual average of 6.8% over the next five years, with a focus on securing capabilities to counter North Korea. If that happens, South Korea will spend as much as Japan today. Similarly, Australia will reach these levels of defence spending by 2030. I put in comparison ASEAN's military spending. ASEAN is not a military pact, but in comparison, spends in aggregate about what South Korea spends.
Data Source: Stockholm International Peace Research Institute, 2023
Data Source: Stockholm International Peace Research Institute, 2023
Taken together, if these facts bring to your minds that Asia is spending a lot militarily, you're quite right. Asia's military spending on the whole has already surpassed Europe in 2009. The gap has since widened even further. Between 1999 and 2021, the combined defence spending by the EU increased only by 20%, compared to the US went up by 66%, for Russia by 292%, and China by 592%. EU countries will now be spending more because of the Ukraine invasion, but Asia's military spending will still be larger for some time to come. The charts show the trends clearly.
What will all this lead to? I doubt anyone can be really sure. But without a robust framework to maintain peace, this up-sizing of Asian militaries can spell trouble ahead. Some of you know that there is a metaphorical Doomsday Clock that has been ticking away. Well, this Doomsday Clock has moved 90 seconds close to midnight this year, the closest to global catastrophe since 1947, post-World War II. Also it's no wonder that some of us sleep less soundly at night.
Long-Term Investment in Defence
Here, it would be remiss of me as Minister for Defence, if I did not thank Members of this House for their constant and strong support through the years for my Ministry's budget. The record shows that MPs of all political parties and NMPs in successive Parliaments have shown this collective support. None of them were beguiled or rendered complacent by peace to push for less defence spending. Yes, questions were asked about how MINDEF and the SAF put our defence dollars to use and if it was effective; questions that needed to be, and were asked by Members here. But not reduced spending. Outside this Parliament, some political personalities did push for reduction – saying that our defence spending is "excessive", or that that external threats for us "don't exist". To them, I say – do not sacrifice a strong defence for Singapore at the altar of political expediency. It may win some support, but risks losing Singapore in that self-interest. As Mr Lee Kuan Yew reminded us even in his later years, "Without a strong SAF, there is no economic future, there is no security". That's a hard truth that remains constant.
We must never forget that defence is a long-term business. For the SAF, major systems and platforms take 10 to 15 years to conceptualise, build and integrate into our fighting force. That's assuming everything runs smoothly, without chop and change. If a military loses a capability and wants to build it back, it may take twice as long.
We need to remind ourselves constantly that investing steadily in defence is the more prudent and cost-effective strategy, especially during good times and peace. Because it's not just the dollars spent, but the know-how, the human capital, the culture, and most important of all, the psychology and mental build-up of commanders and soldiers – crucial for the SAF, which is made up of NSmen in the majority.
Some of you have asked, what have we learnt from the war in Ukraine? We have learnt many lessons, we have been watching it very closely, because it is the only war in which modern, state-on-state warfare has been fought in recent times. There are indeed military lessons to be learnt, but more important than military lessons, examples of how people, ordinary citizens, make the crucial difference, not only in civilian affairs but military too.
Ukrainian civilians have played significant roles in the conflict from the very beginning. Let me just share some examples with you. Workers cut up old train tracks and welded them together to create obstacles. These were known as "steel hedgehogs". Nobody taught them how to do it. They put it up to block Russian military trucks. Volunteers produced, re-purposed and operated drones for Ukraine's Armed Forces. And in particular, when Ukraine's imports were disrupted and the prices of lithium batteries went up, and soldiers needed to communicate. Volunteers began donation drives to collect and recycle batteries to power drone operations. More recently, we also saw footage of improvised grenades, reportedly made by the Ukrainian Army in partnership with civilian engineers. Basically it shows the fragmentation grenades fitted to a shuttlecock or 3D-printed fin for stabilisation. The grenades could then be lifted by commercial drones, and dropped onto targets from above. A cheap and creative solution.
Ukraine's Armed Forces also relied heavily on civilians to gather military intelligence through crowd-sourcing. When the invasion began, the government added new features to the Diia app, the Ukrainian equivalent of our SingPass. Through a chat bot, citizens could help the military locate Russian troops and vehicles by providing photos and videos together with their live locations. As footage flooded in, there were multiple reports of Ukrainian troops successfully destroying Russian convoys thanks to these tip-offs from the public. There was another crowd sourcing app followed – called ePPO – for citizens to report sightings of cruise missiles and kamikaze drones.
Passion, grit, bravery, innovation, and even pure genius in the face of overwhelming adversity. Ukrainians had no electricity or running water, endured freezing temperatures, and were constantly under the threat of incoming missiles. But the resolve of the Ukrainian people to protect their country and defend their freedom shone through all the misery that war brings. If this war has taught us anything, it must be that weaponry and fighting platforms are important, but ultimately, it is the fighting spirit of the people that will decide if they end up subjugated or sovereign. We Singaporeans must build and have that same spirit and resolve. Our lives and our country will depend on it.
Let me now turn to the actual figures for MINDEF Budget. In the coming financial year, my Ministry projects an expenditure of just under S$18 billion. This translates to an increase of 5.6% from FY22 – due to three main reasons.
First, inflation. Monetary Authority of Singapore (MAS) has estimated that Core Inflation should come in at 3.5 to 4.5% in 2023.
Second, we are catching up on projects deferred or disrupted due to COVID-19. Some examples are SAFTI City, NS Square, and the delivery of our submarines.
Third, we will be spending more on digital and other non-kinetic capabilities. I will elaborate on these when giving updates on the new Digital and Intelligence Service (DIS).
I have informed Members previously that MINDEF will strive to keep the growth of Singapore's Defence Budget to be in line with inflation, and we have achieved this target for the past decade at about 4.3% growth each year. We expect this to continue for the next decade too – to stabilise at 3 to 4% year-on-year growth.
By design, as Members have noted, MINDEF does not give detailed information in the Budget Book. Members here know the reason. It is not in our security interest to do so. Just as we do not give the detailed cost figures for acquisition of planes, submarines, and Army platforms, because they provide an indication of capabilities, and similarly we also do not want to provide an aggregated amount for our acquisitions. because you can guess - if your capability development budget is this (and) collected over the years - what you are spending it on.
But the key question that Mr Gerald Giam asked is how then does MINDEF ensure prudence and accountability of its spending? Like all public agencies, MINDEF is held to account for the management of allocated public funds and resources. We are subject to independent audits by the Auditor-General's Office (AGO), where deep dives are taken into MINDEF's processes. In other words, you do not get to see the aggregated picture, but you get to see any of the individual processes. For example, AGO had discovered payment errors of flexible benefits allowances in FY21, and these were promptly recovered. MINDEF does not have any say in what the AGO wants to look at. If they want to look at platforms, we have to show the detailed processes. The Public Accounts Committee can also request for additional information after examining AGO's audits, as it did in this case. We have strong internal controls in place to ensure that expenditure is within stipulated ranges of reference costs. Our procurement processes also adhere to rigorous standards. When there are large-scale projects, we have senior management committees to ensure oversight and compliance. But I take the point, there is a necessary trade-off between accountability and full transparency. There has to be. But I think overall, Singaporeans, with an NS force, can see what our dollars go into. As I said, detailed processes are subject to audit.
Overall, MINDEF's spending has stabilised at between 3 to 4% of our GDP. Barring increasing tensions or persistently high inflation where military spending may have to go up, MINDEF expects this to be the steady state spending.
Building the SAF for 2040 and Beyond
And what have we achieved, final accountability, what have we done with all these defence dollars?
We can have a quiet satisfaction that the SAF today is recognised as one of the most advanced in Asia. The SAF is not large relatively – there was a reason I gave the military spending for all the countries around us. But for our size, all our Services, we are the most advanced in Asia. We operate modern, state-of-the-art platforms. Together, these Services can prosecute campaigns across a spectrum of security challenges. And this modernisation took two decades, but has been completed successfully. Very few militaries have achieved that.
As a result, the Army now uses digitalised fighting and support platforms - the Hunter Armoured Fighting Vehicles, HIMARS and the Leopard Tanks. The Air Force's Smart Multi-Role Tanker Transport aircraft and Aster-30 Missile Systems are new additions, together with the F-15s. The Navy has brought on a full fleet of Frigates, and new Littoral Mission Vessels.
In the next decade, more platforms and capabilities will be added. I previously informed this House in 2019 that the Air Force would purchase four F-35 Joint Strike Fighters because we wanted to evaluate it. It allowed us access to information and facilities for a full evaluation of the F-35s. Our pilots have flown in F-35 Mission Simulators and learnt from operational F-35 instructor pilots. They have evaluated the electronic systems on board the aircraft, and made trips to F-35 bases to study how other users maintain their fleets. We have also flown with other F-35 operators, in particular, very recently at Exercise Pitch Black in Darwin, Australia. All these have given us valuable insights. MINDEF and the SAF have concluded that the F-35 is the best choice to meet our defence needs now and in the future.
MINDEF will proceed to exercise the option to acquire a second tranche of F-35Bs – eight of them – and they will be added to our fleet by the end of the decade. This acquisition will support the progressive drawdown of our ageing F-16s, which will retire from the mid-2030s, which means that at steady state, the RSAF will operate the F-35s and F-15s fighter planes, the most advanced in the region.
For the Navy, we launched our second and third Invincible-class submarines a few months ago in Kiel, Germany. Later this year, we can expect the first submarine to return to home base. By the end of this decade, all four submarines will be operational around Singapore waters. These custom-fitted submarines will be stealthier and more agile, and remain submerged for longer periods of time. They will significantly enhance the Navy's capabilities to protect our interests at sea.
For the Army, the next-generation Howitzer and Armoured Tracked Carrier will be introduced, as well as more unmanned aerial and ground vehicles in our combat units.
Some of you asked about future threats. And indeed, this was the reason we started the DIS and it has allowed us to consolidate and integrate military intelligence, digital, and cyber capabilities.
Last year, we announced the establishment of an SAF digital range. This is making good progress. The digital range will contain virtual replicas of networks and systems that we have nationally, to simulate a wider range of cyber-attacks. When completed in 2026, the digital range will be used to train our DIS forces and conduct exercises with other military and commercial partners. We will also organise joint training with other national agencies, to defend our national critical infrastructure.
Some of you asked what the DIS' mission is. Now digital threats in the cyber arena are pervasive daily -- literally tens, if not hundreds of thousands. What our cyber agencies are more concerned with are external and orchestrated attacks, by both state and non-state actors, for example, by terrorist organisations. The DIS has picked up some entities and are monitoring them for their activities. This is as much as I can say.
The DIS will also set up the Digital Ops-Tech Centre run by software engineers and data scientists to provide in-house software development. This centre will be operational in 2024. I am giving you discrete dates and these are the targets.
Ms Rachel Ong asked about recruitment in the DIS. In 2018, we launched a Cyber Work-Learn Scheme and last year, a new Digital Work-Learn Scheme. Since the launch of both schemes, more than 350 NSFs have signed on. We also saw a 40% increase in applications. We have also received a significant number of applications for non-uniformed roles.
Guarding Against Emerging Military Threats
This transformed quadri-Service SAF will provide Singapore with a strong core defence against foreseeable threats. But even so, I agree with many Members here - we must prepare for new disruptive technologies as well as scenarios that we have not seen. The future is still evolving but the overall shape is already discernible. In the not so distant future, militaries will use a new generation of hypersonic missiles, lethal autonomous platforms, and directed energy weapons. These are just a few examples.
Unmanned platforms are now commonly used in both civilian and military settings. What will be a game-changer is when these unmanned platforms from air, land and sea are scaled to large numbers and weaponised. We have already seen it in the Ukraine war. How do you respond to these? A few years back, drone strikes from Azerbaijan took out Armenian air defences, artillery and armoured vehicles from above. And recently, in Sevastopol, Ukraine launched a coordinated drone attack against the Russian Navy – nine from the air and seven from the sea. These drones were able to break through multi-layered defences around the port, damaging at least two Russian ships. These concrete examples are re-writing the doctrine and practice of modern warfare, as we speak. So how does MINDEF and SAF deal with this, I was asked.
We have set up the Future Systems and Technology Directorate (FSTD). In it are SAF planners, DSTA engineers, and DSO scientists. Their job is to ignore vested interests in the present SAF, but instead to be insurgents, to render obsolete, if they can, current platforms, forces, and even organisations by producing improved ways for Singapore to defend itself in the future. Our future literally depends on them performing their tasks well.
As an example, FSTD spearheaded the research and investments in unmanned platforms a decade ago. Today, autonomous technologies have been built into the Navy's new Multi-Role Combat Vessels to function as a "mothership", with unmanned platforms that can work together to conduct a range of missions. This was a decade ago, because that was how long it takes to conceptualise and build. While older RSN ships typically operate one unmanned system, these vessels are designed to be able to operate multiple systems simultaneously. The Navy will shift towards a future force structure where about half of its vessels will be unmanned.
Enhancing Training to Maintain the SAF's Edge
There is one more vital ingredient for the SAF – our people. We can have the best platforms and systems in the world, but as the Ukrainian spirit shows, it is the spirit and know-how that will determine if the SAF can defend Singapore and its interests successfully.
In order to have well-trained soldiers, we have invested heavily in our training infrastructure. SAFTI City, announced in 2017, is making good progress. The completed training circuits will include battlefield effects simulators that can replicate smoke and blast effects, and interactive targets that can fire back. A far cry from our days when it was "bang bang bang bang, I shoot you, you shoot me". Who can confirm? We just assume both did not get shot, or both got shot.
Phase 1 will be completed next year, and will consist of more than 60 new buildings, with a mix of high-rise interconnected buildings, low-rise residences, a bus interchange, and even an underground MRT station. Buildings and roads can even be re-configured such that soldiers can encounter a different layout each time they train at SAFTI City. So that they can train in a complex urban environment.
Surrounding SAFTI City, we are also building three new Instrumented Battle Circuits (iBACs). The first circuit – Murai Urban Battle Circuit – will be ready by this year, and the other two will be ready by early 2024. These circuits will also simulate enemy fires such as artillery bombardment and air strikes and they will help our soldiers hone their operational instincts and tactical fundamentals.
When these Instrumental Battle Circuits start, up to 22,000 active and NS soldiers will use them every year. Realistic, efficient training.
The new training facilities will have sensors and video cameras to capture data and provide instant replays. Professional sports teams know the value of this. Soldiers and units will receive near real-time feedback on their performance and how they could have better performed their mission or remained alive.
We have also invested large sums into overseas training facilities. I visited our soldiers in Australia last year, in the Shoalwater Bay Training Area. Some new facilities like the Urban Operations Live Firing Facility and the Combined Arms Air-Land Range will be ready for use from next year. This will allow our NSmen and NSFs to participate in large-scale integrated training at Brigade, or eventually Division-level exercises.
We have also increased the use of advanced training simulators, up to 20%. Additional live training will be replaced by them. And you can combine simulators now for different platforms.
But even with all this, we will still need to conduct some training locally – because if COVID-19 taught us something, it is that our overseas training facilities can be terminated instantly, and we do not want to be dependent.
I know that MPs, especially living in the housing estates get feedback and complaints from the residents about noise. And we try to mitigate the impact of this noise. For example, the Air Force reduces flying tempo during critical exam periods, but there is a limit to that. Help explain to your residents that just like NS, this local SAF training is the price we pay to ensure a credible force to protect our freedom and independence. I visited Luke Air Force Base where our F-16 squadron was training. I was talking to the mayor, and I said to the mayor, please tell your residents that we appreciate them tolerating all the noise. Because it is not as if Luke Air Force Base does not have housing estates, just like us. The mayor said, "Don't worry, I tell them that this is the sound of freedom". Whose freedom? Not the US' freedom, but Singapore's freedom. They are willing to invest in our freedom. So explain to your residents, that yes, we will do as much as we can overseas, but there is a limit. We must never be so dependent on others that if we have another pandemic, we find that we can't train and we are operationally less ready.
Mr Chairman, the defence of Singapore is a long-term commitment. The success of it is not for the faint-hearted and can only be achieved if we as one people have that staying power, never flagging in spirit or effort; never lulled or deceived that Singapore does not need a strong SAF because the world is safe or that others will protect us.
We have come far as a multiracial and multi-religious nation to build an SAF that will fight with one heart and aim – to protect our Singapore. We will go even further as long as we commit each year to stay the course.
I want to thank Mr Chairman and its members for this indulgence for staying on a Friday night.