Economic headwinds and the Covid-19 outbreak were definitely heavy influencers of this year’s budget plans.
With talks about Singapore as a Global-Asia Node, to managing climate change, we decided to focus a little more on the things that affect us as workers, as well as parts of the budget that provide a little more immediate financial relief.
#1 Job Support Scheme
With talk of Covid-19 still strong, the Government’s immediate concern is to protect Singaporeans from the risk of further spread. Aside from the $800 million set aside for the Ministry of Health (MOH) and other ministries to respond to the outbreak, this year’s budget also includes a $4 billion ‘Stabilisation and Support Package’.
And from this package, it will include a ‘Job Support Scheme’. This scheme aims to support enterprises by defraying their wage costs. Lower cost for employers equals more job security for employees.
For every local worker in employment, the Government will offset 8 per cent of the wages, up to a monthly cap of $3,600 for three months.
With over 1.9 million local employees, this scheme will cost $1.3 billion and stands to benefit all enterprises and their local employees.
#2 Wage Credit Scheme
Although the Wage Credit Scheme (WCS) is not from the ‘Stabilisation and Support Package’, it will be enhanced by the package to benefit over 700,000 Singaporean employees.
Currently, for enterprises that have invested in raising productivity and hence their employees’ wages, the WCS co-funds Singaporean employees earning a gross month wage of up to $4,000.
With the enhancement, the wage ceiling will be increased from $4,000 to $5,000 for qualifying wage increases between 2019 to 2020.
Meaning: The Government still wants employers to upgrade their workforce and reward employees who upskill accordingly.
#3 Cost of Living: GST to remain at 7 per cent
The supposed Government Service Tax (GST) increase that was to take place sometime between next year to 2025, has been postponed for now.
Less GST, lower cost. Need I say more?
But like Deputy Prime Minister Heng Swee Keat said in his budget speech, the increase cannot be put off indefinitely. So enjoy it while it lasts.
#4 SkillsFuture Credit Top-up
If you thought that your tertiary education was the last time you would be studying, you better think again.
With advances in technology and constant changes in the economy, the only way to ensure that we as workers remain employable, have access to good jobs and earn good wages is that we constantly upskill ourselves to stay relevant.
So in this year’s budget, the Government is again providing a one-off SkillFuture Credit top-up of $500 for every Singaporean aged 25 years and above in December 2020. Unlike the first top-up, this one will expire by the end of 2025, so don’t let this sum go to waste.
Also, there will be a newly introduced ‘SkillsFuture Mid-career Support Package’, which will:
- Increase the capacity of reskilling programmes for locals aged between 40 to 50 years old.
- Provide a hiring incentive to employers who hire local jobseekers aged 40 and above through a reskilling programme.
- Provide another credit top-up of $500 to every Singaporean aged 40 to 60 years old, on top of the one-off credit top-up mentioned previously.
Like Mr Heng mentioned in his speech, the Government’s promise to Singaporeans is: “…Regardless of your starting point, as long as you are willing to learn, we will support you to learn throughout life…”
#5 Care and Support Package
Due to economic uncertainties, this year’s budget also includes a ‘Care and Support Package’ amounting to $1.6 billion for households.
This package will include:
- A one-off cash pay-out of $300, $200 or $100 for Singaporeans aged 21 and above, depending on their income.
- Double the amount of U-Save rebates in a one-off GST Voucher for all eligible HDB households.
- Extension of the Service and Conservancy Charges (S&CC) rebate for another year for eligible households, ranging between 1.5 to 3.5 months.
- Additional help for lower-income Singaporeans such as:
- Workfare Special Payment – Singaporeans on Workfare will receive 20 per cent more for work done in 2019 with a minimum payment of $100.
- Grocery Vouchers – Worth $100 each year in 2020 and 2021.
- Additional help for families taking care of children and the elderly, such as:
- $100 cash pay-out – for every adult Singaporean with at least one Singaporean child.
- Additional GST Voucher – U-Save rebate for larger households with five or more members.
- $100 top-up to PAssion Card – for all Singaporeans aged 50 and above for this year.
- $10 million grant to Self-Help Groups who have been helping needy families and children.
- $20 million for Community Development Councils to strengthen community bonds and help vulnerable groups.