SINGAPORE (May 26): Singapore is injecting another $33 billion in relief measures to help Singaporeans and local businesses tide through the Covid-19 storm that has panned out to be the republic’s biggest crisis since independence.
Dubbed the Fortitude Budget, the additional measures announced on May 26 will build on measures unveiled earlier in the Unity Budget on Feb 18, the Resilience Budget on Mar 26 and the Solidarity Budget on Apr 6, just the before the circuit-breaker measures kicked in.
Together, the total relief measures doled out by the government to cushion the impact of the Covid-19 outbreak now amounts to $92.9 billion – or some 20% of Singapore’s Gross Domestic Product (GDP).
This requires the government to draw an additional $31 billion from past reserves. Together with the measures announced in the previous Budgets this year, the government is looking at dipping into $52 billion from past reserves to tide over this crisis.
“This a landmark package and a necessary response for this unprecedented crisis,” Deputy Prime Minister and Finance Minister Heng Swee Keat said in his parliamentary speech.
The latest round of measures comes as the government adopts a three-phased approach to ease restrictions, once the circuit breaker ends.
Starting Jun 2, a third of the workforce will resume operations, from the current 17%. However, this translates to a significant number of businesses having to remain shut, during the first phase that is slated to last till the end of June.
The first part of the Fortitude Budget comprises $2.9 billion worth of additional support to businesses and employees.
This comes as the resident unemployment rate rose to 3.3% in March – making it the highest in over a decade, Heng said.
To help businesses retain workers, the government will continue its wage subsidy for all firms that remain shut at phase one, at 75% of gross monthly wages for each Singaporean employee in June, for the first $4,600 of wages for each employee. The subsidy will revert to 25% if these firms reopen before the end of phase one.
Meanwhile, the wage subsidy will continue for an additional month to end in October. Spanning a total of 10 months, this subsidy is expected to benefit all of Singapore’s 1.9 million local workers across some 140,000 enterprises. It translates into a total disbursement of $23.5 billion under the Jobs Support Scheme, noted Heng.
Additionally, firms that hire foreign workers on work permits and S-passes that cannot resume operations, will enjoy a waiver of foreign worker levy for up to two more months. These employers will also receive a foreign worker levy rebate of $750 for each work permit or S pass holder in June, and $375 in July.
Beyond this, the government will defer the planned increase in CPF contribution rates for seniors by a year to Jan 2020, so as not to compromise on the disposable income these individuals hold.
Heng also unveiled an SGUnited Jobs and Skills Package, offering close 100,000 opportunities in three aspects: 40,000 new jobs, 25,000 traineeships and 30,000 paid skills training placements. These serve to create more opportunities, amid a soft labour market outlook.
"While we will try to preserve jobs in the midst of this crisis, we cannot protect every job. However, you have my assurance that the Government will protect every worker,” stressed Heng.
"Our promise to workers is this: As long as you are willing to pick up new skills and adapt, to access available opportunities to work or learn, the Government will provide our strongest support to help you”.
Receive more updates on the Fortitude Budget here.
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