Solidarity Budget: Higher wage subsidies, extended rental waivers among moves to help firms, workers

SINGAPORE — To help companies retain and pay their workers during the "circuit breaker" period, Deputy Prime Minister Heng Swee Keat on Monday (April 6) announced a slew of measures to support businesses, such as higher wage subsidies, cuts in foreign worker levies, an extension on rental waivers and more financing support.

For starters, under the enhanced Jobs Support Scheme (JSS), the Government will pay for 75 per cent of the wages of every Singaporean worker in employment, up to the first S$4,600 of their monthly salary, for the month of April.

This is an increase from the 25 per cent of wage support that Mr Heng, who is also Finance Minister, announced during the Resilience Budget on March 26.

With the closure of most non-essential workplaces that will begin on April 7, announced by Prime Minister Lee Hsien Loong last Friday, Mr Heng noted that almost every business and worker will be directly affected by these stepped up safe distancing measures.

“Many firms cannot operate at all, or can only operate at a much reduced level in the coming weeks. But they should still retain and pay their workers,” he said, as he announced this third round of support measures for Singaporeans, known as the Solidarity Budget.

Mr Heng clarified that the cap of S$4,600 does not mean that those who are earning more than S$4,600 will not get wage support.

It means that firms will get wage support for every single Singaporean employee, but that the maximum subsidy for each of these workers will be capped at S$3,450, or 75 per cent of S$4,600.

The first payout for the JSS will also be brought forward from May to April, Mr Heng said, with companies on Giro and PayNow to receive their payouts next week. 

Firms which are not on Giro or PayNow will receive their payouts by cheque a week later. 

“The aim of this strong support is to directly reduce firms’ wage costs, to help them retain their workers. I expect firms to make use of this JSS support to continue paying your workers and refrain from putting workers on no-pay leave during this period, or worse, retrenching them,” said Mr Heng.

Besides waiving the foreign worker levy due in April, Mr Heng said the Government will also provide employers with a foreign worker levy rebate of S$750 for each work permit or S Pass holder, based on previous levies paid in 2020.

The Government will also waive the rents for industrial, office and agricultural tenants of Government agencies by one month. This is an increase from the half-month waiver announced as part of the Resilience Budget.

Stallholders in hawker centres managed by the National Environment Agency will continue to have their rents waived for three months, while commercial tenants will receive two months of rental waivers.

Mr Heng reiterated that a new Bill will be introduced that will ensure landlords pass on the full savings of the 100 per cent property tax rebate from the Government to their tenants, a move that the Finance Ministry announced last week.

The Government will also increase its risk share of several loan programmes from 80 per cent to 90 per cent, he added.

These include the temporary bridging loan programme, the working capital loan for small- and medium-sized enterprises (SME) and the trade loan under the enterprise financing scheme.

Last week, the Monetary Authority of Singapore announced a package of measures to help ease the financial strain on individuals and SMEs, including deferring the payment of loans.

“The economy needs support and intervention in many different forms to go through this rough patch. I urge all businesses, landlords, financial institutions and industry players to do your part, in channelling the government’s support measures to firms, workers and households,” said Mr Heng.