Net Investment Returns Contribution
Definition. The Net Investment Returns Contribution is the portion of the expected long term real returns earned on Singapore reserves, managed by entities such as GIC, MAS and Temasek, that the government is permitted to draw on to supplement its budget. It is a significant source of government revenue.
By spending only part of the expected returns rather than the reserves themselves, the framework preserves the principal for future generations. The NIRC helps fund government spending without resorting to higher taxes.
This term belongs to The Singapore Economy in A Level Economics. Read the full chapter for the diagrams, worked examples and exam technique.
Want to use net investment returns contribution for marks in the exam? Learn it in class or message the team.