Last Updated on 2020-10-03 , 6:18 pm
Unlike some other countries whereby the authorities provide bigly cash loans (or just direct cash) to companies, Singapore uses a scheme called Jobs Support Scheme to keep companies afloat, hoping that it’ll encourage employers to retain their workers during this uncertain period.
Lest you’re not familiar with it, here’s how it works:
- The authorities will pay a certain amount of Singaporean employees’ salary
- To do that, they’ll look at past CPF contributions and provide the funds direct to employers after a few months
The amount has often been different in different sectors, though for the months of April and May, it was 75% for all sectors.
The JSS is supposed to end on August 2020, whereby the last payout would be given on October 2020.
With COVID-19 still battering the economy, it’s no surprise that during in DPM Heng’s ministerial broadcast today, he announced an extension of the scheme—which he’s done so a few times previously.
This time, the extension goes on for up to seven months—all the way to 2021.
That’s up to March 2021, but it’s not for all sectors.
Extension of Job Support Scheme
Previously, the JSS for companies was between 25% to 75%.
In this latest extension, it would be between 10% to 50%, and unlike the previous measures whereby all JSS would end at the same time (August 2020), this will end on different periods for different sectors.
Here are what was announced:
- Aerospace, aviation and tourism sectors = 50% JSS until March 2021
- Built environment sector = 50% JSS until October 2020, then 30% JSS until March 2021
- Arts and entertainment, food services, land transport, marine and offshore, and retail sectors = 30% JSS until March 2021
- Other sectors = 10% JSS until end of 2020
So even if your company is earning big bucks during this period, your company is still getting 10% wage subsidies, though that’s not even enough to cover the CPF contribution from the employer lah. If your firm isn’t impacted by COVID-19, you might want to encourage your boss to donate the extra cash instead of helping him to book a new Mercedes.
DPM Heng said, “I urge all businesses to make full use of this additional support to retain and upskill your workers, and to transform your operations for the post-Covid-19 world. This will enable you to spring back faster when the recovery comes.”
And if you’re a boss who’s just sacked an employee who didn’t help you book a new Mercedes, read on.
Jobs Growth Incentive
A whopping $1 billion will be spent to help companies engage more people.
If companies still can afford to engage lah.
But how?
You see, while nightclubs and KTVs are closing, there are companies that are growing instead, and to encourage them to engage more people so as to create more jobs, Ah Gong is going to co-pay up to 25% of salaries of all new local hires for one year, subject to a cap. For those aged 40 and above, the co-payment to firms will be up to 50%.
For example, if you run a restaurant and realise you’re huat-ing because you’ve just innovated and provide creative takeaway menus instead of complaining about the lack of dine-in customers, Ah Gong will pay 50% of the salary for a new cook (who’s above 40 years old) for 12 months.
Pretty lit, isn’t it?
One of the reasons why the authorities aren’t just giving money like there’s no tomorrow is that there’s a tomorrow after all.
The current JSS cannot be sustained as it “draws heavily” on the country’s reserves and it risks trapping workers in unviable businesses—that is, helping businesses that shouldn’t even be in business in the first place.
Like Goody F—
These measures, together with other measures which we’ll focus on in another article (catered more for individuals instead of businesses), will cost a whopping $8 billion.
This time, we’re not using President Halimah’s ATM card, but “by reallocating monies from other areas, such as development expenditures that were delayed due to COVID-19.”
I can’t help but to think…maybe that’s why the Satellite-Based ERP isn’t ready yet. Just saying.
Here’s a simplified summary of the South Korea martial law that even a 5-year-old would understand:
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