Supplementary Budget Bold and Impactful
Thursday, 26 March 2020 [Singapore] – On the back of the COVID-19 outbreak, Singapore businesses have suffered demand shock and supply chain disruptions, which have put significant pressure on revenues, costs and cashflow.
Against this backdrop, the Singapore Business Federation (SBF) welcomes the S$48 billion Resilience Budget unveiled this afternoon by Deputy Prime Minister Heng Swee Keat. This ramps up support substantially for our businesses and sends a strong signal of the Government’s priority and commitment to keep businesses going and preserve jobs.
Targeted and Timely
The Resilience Budget aptly addresses the most immediate needs of businesses: cashflow, cost and credit. By shoring up our businesses, more jobs can be preserved.
The enhanced Jobs Support Scheme, which has been raised to 25% from 8% and extended to the end of 2020, will help more of our firms to hold on to their workers and put more cash in the hands of businesses to help them weather the crisis. The move to flow the payments under the various wage support schemes quickly is much appreciated by the business community. Likewise, the deferment of income tax payments will give companies more breathing room in the immediate term.
We also welcome the enhancement of the property tax rebates with higher quantum to cover more types of properties including industrial properties. This will provide much needed relief for tenants. Apart from passing on the Government tax rebates, SBF also urges landlords to step up to provide additional help to their tenants in this challenging time.
Access to Credit
A broader financial support plan which includes our banks is crucial to helping our companies mitigate their cashflow challenges. We are heartened that the Monetary Authority of Singapore (MAS) is working with banks and insurers to see how best to help businesses and individuals facing cashflow challenges with their loan obligations and insurance premium payments. The expansion and enhancements of the various financing schemes as well as the S$20 billion loan capital set aside by the Government will provide companies with access to much needed credit to preserve capabilities and ride out the uncertainty ahead. The ability for companies, if needed, to defer capital payments for one year on the EFS-Working Capital Loan and TBLP, is a much-welcomed move.
The Government provided a slew of generous assistance schemes to the hardest hit sectors, especially air travel, tourism, food and beverage services and land transport, one of which is an enhanced jobs support scheme with up to 75% wage offset for some sectors. These measures provide the necessary buffer for those most impacted by the current crisis.
Help for Workers
Given the widespread impact of the COVID-19 outbreak, not all jobs can be saved. In this regard, the SGUnited Jobs Initiative is both timely and targeted. While some sectors may face workforce redundancies, other sectors may be hiring. Being able to match these companies effectively and in a timely manner through virtual career fairs and other means will help lessen job disruption for our workers through this challenging period. SBF looks forward to supporting the Government in this effort to assist displaced Singaporean workers with new opportunities. For first-time jobseekers, the SGUnited Traineeships Programme provides a silver lining amid uncertain times and a gloomy economic outlook.
We are glad that the Government has put in place a more robust safety net for the more vulnerable in the business community such as the Self-Employed Persons (SEPs). Direct cash assistance, additional training top-ups as well as deferment of their personal income tax, will help to mitigate the impact of reduced earnings during this time.
Strengthen Economic and Social Resilience
Businesses need to focus on the longer term and leverage the enhanced measures for companies to digitalise, restructure and transform their workers during the downtime to prepare for the inevitable rebound.
We are heartened that the SG Together Enhancing Enterprise Resilience (STEER) Programme has been further enhanced as the Government will now match $1 for every $2 raised by TACs. We look forward to working closely with other TACs on this initiative to help our companies ride through this economic storm and to build up their capabilities.
Mr S.S. Teo, Chairman of SBF, said, “Unprecedented times call for extraordinary measures. We strongly applaud and support the Resilience Budget and the Government’s decision to draw on the country’s reserves. The business community is extremely heartened that the Government has responded swiftly and comprehensively to the feedback they have given on the assistance that they need. This massive landmark budget will help cushion the fallout for our businesses in the short- to medium-term and give them the confidence to keep their workers and train them in preparation for the eventual rebound.
Now more than ever, our businesses need to rally together to help one another through this difficult time. Those who can, should help those who can’t. Together, we will face this adversity and come out stronger.”
Mr Ho Meng Kit, CEO of SBF, said, “The business community welcomes the massive Resilience Budget which comprehensively addresses the immediate challenges of companies affected by the crisis. Many of the schemes such as the enhanced Job Support Scheme will provide much-needed cash boost for our companies in a seamless way. It is now time for the companies to actively manage their costs and cash flow, save jobs and send employees for training and reskilling. To be effective and beneficial, the various schemes and measures need to be well implemented. SBF, together with the other TACs, will continue to work closely together with the Government to help our companies navigate the various schemes, ensuring that the benefits flow down to them fast.
As announced by DPM Heng, SBF will continue to support businesses with their manpower challenges. Earlier, we had announced that we are helping companies in the manufacturing and services sectors with their manpower needs for PRC Work Pass Holders through the SBF ManpowerConnect initiative. This has already benefitted many companies. We will expand the SBF ManpowerConnect initiative to help companies with their needs for Singapore resident workers through the SGUnited Jobs Initiative. We will do this together with government agencies and various TACs to keep workers employed.”
Mr Kurt Wee, SBF SME Committee Chairman, said, “We applaud the Government for an impactful and timely Resilience Budget which provides a lifeline for our SMEs who are bleeding and struggling with cashflow pressures. We urge landlords to not only pass on property tax rebates in full to their tenants during this critical time, but also match the government rebates dollar-for-dollar. This will potentially have a larger impact on saving our retail and F&B frontline industries. Through this crisis, we hope landlords and tenants can work together to build a more sustainable and better future. We also urge our SMEs to put in place tactical plans to leverage on all the available schemes and measures so they can ride out the crisis with confidence.”