Economists weigh in on Singapore budget

Economists are predicting that the budget will bring changes to innovation funding – how will this affect your workforce?

Economists weigh in on Singapore budget
Economists are predicting that the upcoming Singapore budget will include automation, innovation and skills enhancement measures, which should be welcome news to HR departments.
Automation and robotics
“Expect a more impactful Automation Support Package with a bigger grant and higher risk-sharing by the Government to help companies invest in digital technologies, additive manufacturing and robotics,” DBS senior economist Irvin Seah told The Straits Times.
Initial plans for the Automation Support Package were introduced at last year’s budget hearing and was originally slated to commit $400 million over the course of three years in support of companies automating their processes and scaling up.
Industry transformation
Economists also predict that the budget will introduce more industry-specific action plans under the Industry Transformation Maps developed for 23 key industries as “part of the $4.5 billion Industry Transformation Programme announced last year”.
"The first cut of productivity measures has helped. Moving on, the focus will be shifted to driving structural changes, in terms of creating a business environment conducive for innovations and start-ups, for example," said OCBC economist Selena Ling.

Support for workers
Prime Minister Lee Hsien Loong, at his recent Chinese New Year address, said that the budget will respond to more immediate economic needs and that organisations should “persevere with upgrading”.

Ling said this means workers need more support during the transition such as financial support by temporarily pushing back income tax payments or granting one-off tax rebates for retrenched workers, particularly professionals, managers, and executives (PMEs).

“With the labour market softening and headline inflation inching up, I think some form of financial support for workers that are caught in the job-skill mismatch will be welcomed, particularly among the PMEs,” she said.

Though she did caution that the government will likely take a conservative approach given the recent economic conditions and the country’s fiscal position.
How these changes will affect HR departments on a functional level is yet to be seen.

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