facebookResilience Budget vs COVID-19: Additional Support Measures for Singaporeans in Response to the Pandemic




Resilience Budget vs COVID-19: Additional Support Measures for Singaporeans in Response to the Pandemic

profileMing Feng

COVID-19 Coronavirus Pandemic

The COVID-19 Coronavirus pandemic has hit the world hard. 11 March 2019, WHO declared it to be a pandemic, WHO estimates that at least 410,000 around the world were infected.

The world not only reacted with tumbling stock markets, social distancing, blocking of tourist and the fear of the pandemic drove many industries to the brink.

It contracts our economy by 2.2% in Q1, airlines, hotels and tourism venues made losses with little tourist to support the economy.

Events and entertainment venues were also made to shut down 26 March 2020 onwards, as an attempt to contain this enemy of humanity.

With many Singaporeans livelihood on the line, here’s a summary of some of the initiative by the government to address the issue.

Economists estimate that the size of the second stimulus package could fall between S$14 billion and S$33 billion.

If true, this budget will incur a larger drawdown on the reserves than in 2009, when around S$4 billion was taken out from past reserves. Then, President S R Nathan approved it.

The current government’s surplus of S$7.7 billion, after taking into account the projected deficit of S$10.95 billion incurred by the Government’s total spending in Budget 2020.

Resilience Budget vs COVID-19: What Support Can Singaporeans Expect?

We will bring you Live update on the Resilience Budget 2020.

After Budget 2020 announced in February, COVID-19 Coronavirus calls for the need to implement a substantial second package

  • Stabilise economy
  • Keep as many workers employed
  • Help viable enterprises survive

The Global growth forecast is expected to drop again in April. A recession may be unavoidable and at reach a level, as bad as that in the year 2008.

Aviation and Tourism sectors got hit the hardest, followed by F&B and transport sector.

Resilience Budget

Resilience Budget’s amount:

  • First tranche: $48billion to deal decisively
  • Together, this budget will cost almost $55billion

Save Jobs and Support Workers

If you are employed, the Enhance Jobs Support Scheme

  • Co-funding will be raised to 25% for local workers
  • Workers in the Food services sector will get a 50% co-fund
  • Aviation will receive 75% co-fund of wages

Support for Self-employed (taxi, private car drivers, agents, sports coaches, media and arts)

Self-Employed Person income Relief Scheme (SIRS)

  • Receive $1,000 a month for nine months

Self-employed Persons Training Support Scheme

  • Train and upskill, set aside $48mil (with effect from 1 May 2020 extended to December 2020)

Workfare Income Supplement Scheme (WISS)

  • Enhanced payment to $3k each in cash

Support for Jobseekers (Fresh Graduates)

This support is for first-time job seekers, such as students graduating this year.

SGUnited Traineeships Programme to provide young ppl with opp to gain valuable work experience

  • Close to 8,000 traineeships this year across large and small enterprises
  • MOM will issue more details soon 

SGUnited Jobs Initiative

  • To create 10,000 jobs over the next year
  • Accelerate hiring plans to meet these roles
  • Recruit for long-term roles
  • Social services, early childhood, ICT (to enhance)
  • Offer short term (health declare assistance, transport ambassadors)

Work with trade sectors and chambers

  • To recruit for future
  • Micron and SMRT are on board SG United Jobs Initiative

WSG will launch SGUnited Jobs Virtual career fair for a jobseeker to find a job on Friday

  • 2,200 job vacancies on Friday

Support if you lose your jobs or have your income reduced

Lost jobs or income reduced

ComCare Scheme

  • Greater flexibility for applications

Temporary Relief fund

  • Provide immediate financial assistance to families

Covid-19 support grant

  • $800 over 3 months

A total amount of $145 million will be set aside for this.

Support For Families

Enhance Care and Support Budget

  • One-off cash handout will increase 3 times, from $300 – $900

Additional help for families with children

  • Assitance will triple from $100 to $300 for each parent

Enhanced workfare special payment of $3,000

Enhanced grocery voucher

  • Total of $400
  • Passion card top-up optional (to lower queues)

Partner community strengthen the network of support around workers and families

  • Double grant to Self-help groups to $20mil over 2 years
  • Increase add the grant to CDCs from 20mil to 75 mil

$25 mil NTUC care fund

Support for those who took a loan

There will be greater flexibility on fees and repayment of loans.

The government will be

  • freezing all government fees and charges for 1 year
  • They will also suspend all government loan repayments from 1st June 2020 to 31 May 2021

Support for Business Owners

To help with the cashflow of Business Owners

  • $0.6Billion will be disbursed in March
  • $5.6Billion in May (cumulative)
  • $16.2Billion to be given to businesses by Oct 2020 to help
  • There will also be a 3-month automatic deferment of income tax payments
    Eg. Tax this year will be deferred to pay for other more urgent things
  • Auto deferment of income tax payments for companies and self-employed for three months

To help with the cost

  • Property tax rebate to be enhanced
  • The amount will be raised and more types of properties to be covered
  • Businesses in non-residential will not need to pay property tax
    100% for qualifying commercial props
    30% for non-residential
  • Landlords are highly recommended to pass rebate onto tenants for long-term wins for both landlords and tenants
  • The Government will enhance rental waivers: Enhanced Rental Waivers for Government managed properties
    Support tenants (NEA > hawkers)

Credit ($20b of loan capital to support good companies and catalyse private sector loan capital)

Financing schemes to be enhanced for hardest-hit biz

Enhanced Enterprise Financing Scheme – Trade Loan

  • $5mil to $10mil
  • Risk share (gov) up to 80% from 70%

Enhanced loan insurance scheme

An expanded temporary bridging loan programme

  • Increase to $4mil

Enhanced enterprise financing scheme to help with working capital

  • In general, provide help where credit risk is more acute
  • MAS will announce later

Support for Sectors That Got Affected

Support for Tourism and international travel (airports, airlines, travel agents, hotels etc)

  • Aviation is core in this system
  • COVID-19 single biggest shock to airlines and air hubs
  • Consolidation is expected (some airlines won’t survive)
  • Governments are supporting their carriers (eg. US)
  • 24 Mar, daily passenger traffic fell >90%
  • SIA announced 96% cut to scheduled cut till end April
  • Global connectivity is of fundamental importance  to Singapore (links country to rest of the world)
  • Changi Air Hub and adj industries impt pillar (>5% of SG GDP; 192k people employed)
  • If it collapses, hard to rebuild and recover (impedes rest of economy)
  • Enhanced Job support Scheme: 75% wage offset for every local worker employed in aviation ($400b in total)
  • $350million Enhanced Aviation Support Package for airlines

Support for Aviation Sector

  • SIA Group sits at heart of SG’s aviation ecosystem
  • Diminished SIA will undermine our recovery once COVID-19 is recovered
  • SIA will need liquidity
  • SIA will benefit from EJSS and EASP
  • Requested halt of trading, will make announcement soon regarding corporate action (supported by Temasek Holdings)
  • We will make sure SIA will come through this in good shape
  • This is about preserving the airlines

Support for Tourism Sector

  • EJSS for hotels, cruise terminals, MICE venue operators (75% offset [of first something something amount] for every local worker)
  • $90mil to help tourism industry rebound when time is right

Support for Food Service Sector

  • EJSS 50% offset for first $4,600 of monthly wages for F&B sectors

Support for Land Transport Sector

  • $95million to extend and Ehnache Point-to-OPoint Support Package (taxis and private hire cars)
  • 1-year road tax rebate and 6-moth waiver of parking charges

Support for the arts and culture sector

  • $55million to support and upskill and digitalise

Lastly, there is ZERO NEED to worry about our food supply. Singapore has a multi-pronged strategy to keep a steady supply of food!

About Ming Feng
A stint in Bloomberg gifted me with a beer belly, which only grew larger when I moved on to become a Professional Trader. Now I turn caffeine into digestible finance-related content.
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