SINGAPORE — To keep Singapore “ahead in the race”, the nation must redouble efforts to invest in new capabilities that span across the digital realm, innovation and its people, said Finance Minister Lawrence Wong on Friday (Feb 18).

Speaking in Parliament during his Budget 2022 speech, Mr Wong said Singapore has a “window of opportunity” over the next few years to establish leading positions in key market segments.

The first priority, he said, is to “strengthen” Singapore’s digital capabilities.

Here is a summary of how the Government intends to achieve this goal.

INVESTING IN DIGITAL CAPABILITIES

Mr Wong said an additional S$200 million will be set aside over the next few years to go towards enhancing schemes that build digital capabilities in businesses and workers.

The Ministry of Finance (MOF) said in a fact sheet on Friday that such schemes will include those offered by various agencies such as Advanced Digital Solutions, Grow Digital and TechSkills Accelerator.

Mr Wong said more details will be announced during the Ministry of Communications and Information’s upcoming Committee of Supply debate.

INFRASTRUCTURE IMPROVEMENTS

To meet the nation’s future needs, Mr Wong said Singapore will be upgrading its broadband infrastructure over the next few years. This will see broadband speeds increasing by around 10-fold.

To “ride the next communications and connectivity wave”, Mr Wong also said that Singapore will be investing in future technologies such as 6G cellular technology.

MAKING INNOVATION PERVASIVE

At present, Mr Wong said most research and development projects are undertaken by multinational corporations.

Singapore will be giving more support to local firms to undertake their own research and development activities.

This will be done by increasing the capacity of centres that deal with technology, innovation and enterprise activities in polytechnics and Institutes of Technical Education over the next five years.

This will allow such centres to undertake close to 2,000 innovation projects across five pilot sectors.

These sectors are: Agri-tech, construction, food manufacturing, precision engineering and retail.

STRENGTHENING LOCAL ENTERPRISES

Much of the Government’s priority for the broad base of small- and medium-sized enterprises is to raise productivity, said Mr Wong.

As such, he said S$600 million will be set aside to scale up the Productivity Solutions Grant to support more than 100,000 related projects over the next four years.

Aside from productivity improvements, a new Singapore Global Enterprises initiative will also be introduced.

This will provide promising local enterprises with assistance in areas such as innovation, internationalisation and partnerships with other firms.

Another initiative, the Singapore Global Executive Programme, will also be launched to help enterprises find and nurture their “next generation of leaders”, said Mr Wong.

This will be done through industry and overseas attachments, mentorships and peer support networks.

ENTERPRISE FINANCING SCHEMES

Beyond grants and assistance, Mr Wong said some companies will need help with their financing needs.

He said such support will be provided through the Enterprise Financing Scheme.

Two components of the scheme will be improved.

It will now expand on its merger and acquisition loan programme to include related domestic activities from April 1 this year to March 31, 2026.

It will also maintain the 70 per cent risk-share under an enhanced trade loan beyond Sept 30 this year for companies trading in nascent markets such as Bangladesh or Brazil.

Mr Wong said he hopes this will “encourage our enterprises to seek untapped opportunities in these markets”.

SUPPORTING NTUC’S COMPANY TRAINING COMMITTEES

Mr Wong said the company training committee (CTC) model brings together unions and employers together to develop concrete transformation plans, including identifying relevant training required for workers so they can enjoy better wages, welfare and prospects.

To date, the National Trades Union Congress (NTUC) has 800 CTCs with companies of various sizes. Mr Wong said the trade union body would “like to do more”.

As such, he said S$100 million will be set aside to allow NTUC to scale up the CTC programme.

Part of the funds will go towards a new grant administered by NTUC to support companies that have set up CTCs to implement transformation plans.

INVESTING IN PEOPLE

Targeted help at companies aside, Mr Wong said Singapore will invest in the continued development of its people.

One way is through transforming Institutes of Higher Learning (IHL) into “institutes for continual learning”.

Mr Wong said the programme at IHLs will be reviewed and enhanced to provide quality continuing education and training.

More information will be given during the Ministry of Education’s Committee of Supply debate.

At present, employers who wish to train their workers in relevant skills can do so through the SkillsFuture Enterprise Credit. However, Mr Wong noted that they tend to be utilised by larger enterprises.

To help smaller and micro enterprises afford to train their employees in relevant areas, a waiver of the Skills Development Levy requirement will be introduced for the qualifying period of Jan 1 to Dec 31, 2021.

Mr Wong said this is estimated to double the number of eligible employers from 40,000 to 80,000.

Newly eligible employers will be notified in April 2022, said MOF.

The deadline to claim the credit will also be extended by a year to June 30, 2024.

Mr Wong said “special attention” will be paid towards mid-career workers, especially those in their 40s and 50s, as they are more vulnerable to disruptions in the workplaces.

Therefore, he said company attachments for mature mid-career workers will be made a permanent feature through the SGUnited Mid-Career Pathways Programme.

Mr Wong said there will also be a new SkillsFuture Career Transition Programme to provide quality, industry-orientated training courses for jobseekers.

ADJUSTING FOREIGN WORKER POLICIES

In his speech, Mr Wong also spoke about the changes to various foreign worker policies.

Employment Pass

• The minimum qualifying salary will be raised to S$5,000, up from S$4,500
• For the financial services sector, it will be raised to S$5,500, up from S$5,000
• New applications will begin from September this year, while renewal applications will start from September next year

S Pass

• The minimum qualifying salary will be raised to S$3,000, up from S$2,500
• For the financial services sector, it will be increased to S$3,500
• New applications will begin from September this year, with renewals from September next year
• The tier 1 levy will also be raised from the current S$330 to S$650 by 2025

Work permit for construction and process sectors

• The dependency ratio ceiling will be lowered from 1:7 to 1:5 from Jan 1, 2024
• The current man-year entitlement framework will be replaced with a new levy framework
• This will encourage firms to support more offsite work and employ more higher-skilled work permit holders
• The new levy framework will take effect from Jan 1, 2024

More details on the foreign worker policy changes will be given during the Ministry of Manpower’s Committee of Supply debate.