Heng Swee Keat calls it a landmark package and a necessary response to the unprecedented COVID-19 crisis
Singapore yesterday announced the ‘Fortitude Budget’ to combat the COVID-19-related economic crisis. Calling it a landmark measure, Deputy Prime Minister Heng Swee Keat said this fourth support package will bring Singapore’s total spending against COVID-19 to over $100 billion.
The latest government measure builds on three previous packages, Solidarity, Resilience and Unity Budget, and offers enhanced versions of existing schemes.
For the measure to succeed, Heng reminded businesses to do their part to support one another. For instance, large firms can help suppliers by bringing forward payment schedules.
‘Fortitude’ takes into account the impact of the two-month Circuit Breaker and aims to support workers and businesses that remain affected by border closures and safe distancing measures, explained Heng.
With the phased reopening to begin on June 2, the minister said he expects most businesses to reopen by July.
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Firms not allowed to reopen after the end of the Circuit Breaker will be given up to 75% wage support until August or until firms are allowed to re-open – whichever is earlier.
He also acknowledged that hard-hit sectors like aviation and tourism will take longer to reopen fully. In this case, Singapore will consider providing additional help, depending on the situation and longer-term outlook of the industries.
Here are some key highlights of the Fortitude Budget.
Jobs Support Scheme
The Jobs Support Scheme will be extended to eligible employers till August 2020.
The higher subsidy level of 75% was originally provided to all employers of local workers for April and May, to tide businesses through the circuit breaker period.
The types of firms eligible for the different tiers of support under the scheme will be reclassified to help those more severely impacted, based on feedback from industry associations and businesses.
- Firms in the aerospace sector including those in maintenance, repair, and operations, will now receive 75% wage support.
- Firms in the retail, and marine and offshore sectors will now receive 50% support.
- For the built environment sector, which includes construction, wage support will be raised to 75 per cent. The 75 per cent will only apply to wages paid between June and August.
Eligible firms will receive a back-payment to top up their previous payouts. This “retrospective payment” will be made by July.
Foreign worker levy
The foreign worker levy waiver and rebate will also be extended for up to two months. Companies in the construction, marine and offshore and process sectors will be eligible for a 100% waiver in June and 50% waiver in July. There will also be a rebate of $750 in June and $375 in July.
READ MORE: 'Solidarity' Budget: More measures revealed amid recession
CPF contribution increase deferred
The government will defer the planned increase in CPF contribution rates for senior workers by one year – from Jan 1, 2021 to Jan 1, 2022.
40,000 new jobs
As mentioned in previous speeches, Singapore’s public sector will be ramping up hiring in sectors including healthcare and childhood education.
Heng said the public sector will bring forward its hiring plans to meet long-term needs. It’s estimated that the public sector will create 15,000 jobs, when combined with jobs created to meet short-term needs of COVID-19 crisis.
The government will work with businesses in the private sector to create another 25,000 jobs.
“Many businesses have stepped forward, with openings in a wide range of job roles, such as computer engineers, and machine operators,” he said. “I encourage more businesses to do even more in the coming months.”
Traineeship and hiring incentive
Jobseekers will be provided traineeships, or a form of apprenticeship in a wide range of industries. About 25,000 positions will be offered through SGUnited Traineeship program and a new mid-career program.
“We understand that many are worried about their job prospects,” Heng said. “This scheme specifically caters to the needs of mid-career individuals, to learn new skills and embark on new careers.”
Employers will be offered an incentive to hire these jobseekers. For eligible local workers aged 40 and above, the incentive will be doubled to cover 40% of their salary over six months, capped at $12,000 in total.
For eligible local workers under 40, this incentive will cover 20% of their monthly salary over six months, capped at $6,000 in total.
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Office rental waiver
Cash grant to be provided to offset the rental costs of SME tenants, to be disbursed through property owners. Grant will be disbursed automatically to property owners from end-July.
The Minister for Law will also introduce a new Bill next week that will mandate that landlords grant a rental waiver to SME tenants which have suffered a significant revenue drop in the past few months.
“Building a resilient society requires collective ideas and energy, and knowing what Singapore stands for,” Heng said. “Special care must be given to vulnerable people like seniors, special needs individuals and those who have lost their jobs.”
