Singapore—Finance Minister Heng Swee Keat said in Parliament on Tuesday (Feb 16) that even as parts of the globe are still grappling with the Covid-19 pandemic, Singapore’s focus on “emerging stronger together” will be reflected in the year’s Budget.
COVID-19 Resilience Package
He first announced that pandemic aid will continue, to the tune of S$11 billion set aside for the COVID-19 Resilience Package. It will be funded by drawing on the past reserves. This would bring the total draw from last year up to S$53.7 billion.
This will ensure that the country’s immediate needs are met in protecting public health and safe reopening, as well as support provided for workers and firms where needed. Thirdly, this will also ensure targeted support for sectors that are still under stress due to the pandemic.
Mr Heng announced that, for the coming Fiscal Year, the overall deficit is expected to be $11 billion, or 2.2 per cent of the GDP, as the Government continues to help the country tide over the economic woes of the Covid-19 pandemic.
The Jobs Support Scheme (JSS) will be extended to support businesses. The JSS will focus on such sectors that have been hard-hit, such as aviation, aerospace, tourism, retail, arts and culture, and food services.
The SGUnited Jobs and Skills Package has been extended as well, with an allotment of S$1.5 billion. This will help employees who have become unemployed or whose income has been severely reduced, but who are willing to find new work or be trained.
Thirdly, the Resilience Package will be bridging support for such sectors as aviation companies, taxi and private hire car drivers, arts and culture, and the sports sector.
Businesses and different sectors
Mr Heng made special mention of extra support for Changi Airport, which has been operating at a very low capacity because of the pandemic. He said that the connectivity of Changi will be restored as the country invests in on-arrival testing and biosafety systems.
He also said that partnerships around the globe, as well as with Asean countries, will also be strengthened in order to enable Singaporean firms to plug into global and regional supply chains and industry clusters.
Additionally, the Finance Minister said that $1 billion has been allocated for programmes that would help mature enterprises invest in new technologies.
As for Large Local Enterprises, $500 million is marked to be co-invested with Temasek for a Local Enterprises Funding Platform. With Temasek matching the Government’s investments, this sector will have the capital needed to grow.
The Government will also extend the Capability Transfer Programme, which supports foreign-to-local skills transfer. Importantly, Mr Heng said that the Sub-Dependency Ratio Ceiling will be reduced. This will allow manufacturing to develop a skilled local workforce and reduce reliance on foreign workers.
Mr Heng also mentioned that in the healthcare sector, the salaries of nurses and other healthcare workers will be enhanced, in part due to the strong commitment they have shown throughout the pandemic.
Under the Household Support Package, S$900 million has been allocated. Under this package, eligible Singaporeans will be getting a one-off GST Voucher – Cash Special Payment of $200, on top of the regular GSTV – Cash payment, and apart from other top-ups, vouchers and rebates.
Sectors in need of additional support
Mr Heng identified three vulnerable groups that could use additional support: lower-wage workers, lower-income families, and children with special needs.
He said that the Ministry of Manpower will be giving details of the support to be given to low-wage workers under the Tripartite Workgroup on Lower-Wage Workers.
There is also additional support for the Senior Worker Early Adopter Grant and the Part-Time Re-employment Grant as an incentive for companies to raise retirement and re-employment ages.
For lower-income families, the support offered to them will be expanded to cover 14,000 families nationwide through 2023. And as for students with special needs, the Government will pilot a three-year Inclusive Support Programme.
Support for charities
To encourage Singaporeans to be generous, the Government is also extending the 250 per cent in tax deductions till the end of 2023.
Charities will also receive more incentives, including receiving dollar-for-dollar matching on eligible donations and the S$20 million for the Change for Charity Grant.
Sustainabilty for Singapore
In line with the country’s endeavour to harness technology to overcome our water and land constraints, $60 million will be allotted for a new Agri-Food Cluster Transformation grant.
Additionally, $30 million will be set aside over the next five years for electric vehicle-related initiatives, which will further reduce carbon emissions. For this, Mr Heng said the Government aims to deploy 60,000 charging points at public car parks and private premises by 2030. That is higher than the previous target of 28,000.
The Government will also issue green bonds on certain public infrastructure projects.
Funding the Budget
Mr Heng said that the COVID-19 Resilience Package will be funded by drawing on the Past Reserves.
As for recurrent expenditure, including healthcare, education, and security, this will be funded by recurrent revenue.
He added, however, that the GST rate increase will not take effect this year, due to current economic conditions. It could be moved to sometime between 2022 and 2025, depending on the economic outlook.
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