Singapore Budget: Government to defray workers’ wages
The Singapore government has delivered a much-needed aid for businesses and jobs after announcing a slew of strong measures, one of which is a new Job Support Scheme which will defray 8% of local workers’ wages for three months.
The scheme looks to help businesses retain local workers and to tide through the economic slowdown impacted by the COVID-19 outbreak.
This will complement the existing Wage Credit Scheme, which co-funds wage increases for local workers who earn at least SGD$4,000 a month.
Deputy Prime Minister Heng Swee Keat, who delivered the Budget, also announced that the Wage Credit Scheme will be enhanced. The monthly wage ceiling will be raised from SGD$4,000 to SGD$5,000 for qualifying wage increases given in 2019 and 2020.
He said, “To help our workers stay employed, I will support enterprises by defraying their wage cost through two schemes.
“With over 1.9 million local employees in Singapore, this will cost the Government $1.3 billion and benefit all enterprises and their local employees.”
Government co-funding levels for 2019 and 2020 qualifying wage increases will be raised by five percentage points to 20% and 15% respectively.
“With these enhancements, another $1.1 billion will go to about 90,000 enterprises, to benefit more than 700,000 Singaporean employees,” he added.
Assistant Secretary-General of NTUC, Patrick Tay, lauded the Budget for supporting businesses and workers in these times of need.
“The measures announced will help both businesses and workers in that the stabilisation and support programme will help defray business costs and the training and employment subsidies, credits, and funding will help in the enhancing the employment and employability of workers (ranging from the young and mid-career to re-employed workers),” he said.
Samir Bedi, Ernst and Young’s Asean Workforce Advisory Leader, said, “The Enhanced Wage Credit Scheme and Job Support Scheme should be well-received by employers and employees alike, which further motivates employers to recruit, reskill and retain locals, embrace technology to increase productivity and share gains with employees.”
Corporate Income Tax Rebate
The government will provide a 25% corporate income tax rebate to all tax-paying companies for the year of assessment in 2020. The rebates will be capped at SGD$15,000 per company and will cost the government an estimated SGD$400 million.
SkillsFuture credit top-up
With the aim to double the annual job placement of locals in their 40s and 50s to around 5,500 by 2025, the government announced a top-up of SGD$1000 in SkillsFuture credits for workers in their 40s and 50s to help them stay employable and move to new jobs or new roles. This comprises of SGD$500 that will be topped up into Singaporeans aged 25 and older, with an additional SGD$500 for those aged 40 to 60 as at December 31 this year.
The credits can be used for career transition programs such as the Workforce Skills Qualifications Certificate in Healthcare Support (Nursing Care), and the National Infocomm Competency Framework-Advanced Certificate in Infocomm Technology (Infrastructure).
Enabling Employment Credit
To encourage employers to hire people with disabilities, the government has introduced a new Enabling Employment Credit. It will be available for five years from 2021 to 2025. And the exact criteria and quantum will be reviewed and adjusted after two years to ensure that it achieves it goals of improving employability of people with disabilities.
“There is much value to be gained when a community comes together in support of a cause,” Deputy Prime Minister Heng said.