Gov’t to invest a further S$8 billion to help Singapore’s economic recovery, says DPM Heng in ministerial statement

Gov’t to invest a further S$8 billion to help Singapore’s economic recovery, says DPM Heng in ministerial statement

The government is investing a further S$8 billion in the fight against the economic impact of COVID-19 said Deputy Prime Minister and Finance Minister Heng Swee Keat in a ministerial statement on Monday (17 August), outlining the government’s plan to “evolve and extend” its support for workers and companies during this COVID-19 crisis.

He noted that funds from delayed development expenditures will be channelled towards these further measures and initiatives, adding that there are no plans for now to draw on past reserves, as was done for the previous three budgets announced this year.

Jobs Support Scheme extension until March 2021

One of the measures is an extension of the Job Support Scheme (JSS)—which was introduced at the beginning of the pandemic to protect jobs—by up to seven months to cover wages paid up to March 2021. Previously, it was up to August 2020.

Mr Heng revealed that over S$16 billion of JSS payouts have been disbursed since then, adding that they have benefited more than two million local workers in over 150,000 firms.

However, Mr Heng cautioned that the JSS cannot be sustained at current levels given that it draws heavily on Singapore’s reserves and risks trapping workers in unfeasible businesses. He said that support will be regulated based on the projected recovery of the different sectors.

Mr Heng went on to explain that, all told, most businesses will end up receiving wage support for 17 months to help retain as many workers as they can with support ranging from 10% to 70%.

Sectors that have been hard hit, such as aerospace, aviation and tourism, will receive 50% wage support for an additional seven months, while the construction sector will see the wage support reduced to 30% starting November 2020 to March 2021.

As for arts & entertainment, food services, land transport, marine & offshore and retail, these sectors will receive 30% wage support for another seven months. All other sectors will received 10% wage support while those sectors that are “managing well” will only see the help until December 2020.

Mr Heng then encouraged businesses to make full use of this additional support to retain and upskill their workers, and also to prepare their operations for a post-COVID-19 world.

S$1 billion Jobs Growth Incentive; further support for workers

Next, Mr Heng announced a S$1 billion Jobs Growth Incentive (JGI) to encourage firms to increase the number of local hires over the next six months, adding that there is a special focus on creating new jobs for mature workers.

Mr Heng highlighted the biomedical sciences, financial services, and info-comm and technology (ICT) sectors as those that would continue to need more workers. On top of that, the public health and long-term care sectors are also hiring while several food & beverage and manufacturing sectors are innovating and growing.

For these firms, Mr Heng said that the government will co-pay up to 25% of salaries for all new local hires for one year, subject to a cap. The co-pay will be up to 50% for hires of employees aged 40 and above.

Mr Heng noted that the Ministry of Manpower will release more details on the JGI later this month.

He then encouraged jobseekers to visit any of the 24 SGUnited Job and Skills Centres around Singapore to make use of the resources in order to find suitable jobs, traineeships, attachments or training in order to be “better prepared when the job market recovers”.

However, he then goes on to warn that retrenchments are unavoidable given the current circumstances. Although, he reassured workers that they will continue to be supported as the government works with tripartite partners to help displaced workers.

He said, “We are updating the Tripartite Advisory on Managing Excess Manpower and Responsible Retrenchment to incorporate the Fair Retrenchment Framework proposed by NTUC.”

He added that the COVID-19 Support Grant (CSG) will be extended until December 2020 to help Singaporeans who hare unemployed or have suffered income loss due to the pandemic, adding that the grant extension will be open to existing recipients and new applicants starting October.

More details will be announced by the Ministry of Social and Family Development later in September, said Mr Heng.

The minister went on to announce that the government will widen the eligibility of the Workfare Special Payment (WSP) to include those who were not on Workfare Income Supplement (WIS) last year but have received or will be receiving it for work done this year.

At the moment, those on the WIS scheme for work done in 2019 are eligible for a S$3,000 WSP.

Mr Heng asserted that Singapore must look out for low-wage workers, adding that many of them are essential workers who have kept Singapore going amid the crisis.

Additional S$187 million for aviation; 4,000 new jobs in healthcare

Moving on, Mr Heng pointed out three sectors that have been hardest hit—aerospace, aviation and tourism. He announced further support for these sectors so that it may be able to retain its core capabilities and be positioned for an eventual recovered, noting that these sectors are important to the country’s economy.

As such, Mr Heng announced a S$187 million cost relief for the aviation sector in particular, given Singapore’s position as a global business node dependant on its connectivity as an air hub. This allocation is an extension of the Enhanced Aviation Support Package up to March 2021.

On top of that, the government is also scaling up the temporary redeployment program which will create about 4,000 new jobs, including permanent position, in the healthcare sector along.

As for Singapore’s other major sector—tourism—Mr Heng announced that S$320 million ill be set aside for SingapoRediscovers Vouchers which Singaporeans can use to explore local tourism.

Next, Mr Heng announced that S$150 will be set aside for the enhancement of the Startup SG Founder programme, in phases, to continue to spur innovation and entrepreneurship.

To continue to spur innovation and entrepreneurship, he announced that he will set aside up to $150 million to enhance the Startup SG Founder programme in phases.

This includes raising the start-up capital grant and continuing to provide mentorship. He added that the Ministry of Trade and Industry will provide more details later this week.

Mr Heng concluded his statement saying, “It is a difficult journey ahead, but you will not walk alone. We are faced with an extraordinary crisis, but we are one people with extraordinary courage, commitment, and can-do spirit.

“We have the fortitude – to improvise, adapt, and overcome the uncertainties. We have the resilience – to weather the difficulties, turn challenges into opportunities, and prepare for the future.

“And we will stand in solidarity as one united Singapore – to beat this crisis and emerge stronger as a nation.”

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