Fiscal prudence
Definition. Fiscal prudence is the principle of managing public finances responsibly so that government spending is sustainable and budgets are broadly balanced over the medium term rather than financed by persistent borrowing. In Singapore this discipline is reinforced by constitutional rules that protect past reserves and limit deficit spending.
By avoiding chronic deficits and accumulating reserves, fiscal prudence preserves the capacity to respond to crises and supports investor confidence in the economy.
This term belongs to The Singapore Economy in A Level Economics. Read the full chapter for the diagrams, worked examples and exam technique.
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