Barely a month after making the official Budget 2020 announcement, Singapore, like many other nations, took an unexpected economic downturn due to the rapid COVID-19 transmission, which originated in Wuhan, China in December 2019.
However, the Lion City became one of the countries that had its guards up early in the event because it remains the strongest economy and the entrance to the region’s prosperity.
In order to mitigate the crippling effect of the spread of the virus and to ease the lives of its citizens, the country’s Deputy Prime Minister Heng Swee Keat on Thursday announced a US$34 billion Resilience Budget. Its goals are to “Support Workers. Stabilise Businesses. Build Resilience”.
The key highlights of the “Resilience Budget” are:
- Jobs Support Scheme (JSS), in which the government will pay 25 per cent of monthly wages to every local worker in employment, with higher support for sectors more affected by COVID-19 (up to 75 per cent)
- COVID-19 Support Grant, a cash grant of US$561 per month for three months for low- and middle-income Singaporeans who lost their jobs due to COVID-19
- Temporary Relief Fund, which provides immediate financial assistance for families whose livelihoods were affected by COVID-19
- Support for self-employed Singaporeans, who will receive US$702 a month for nine months upon eligibility along with training support with allowance
- Enhanced care and support package, which ensures enhancements on Singaporeans who received Workfare payments for work done in 2019 up to US$2,105 in cash
- NTUC Care Fund (COVID-19), a relief for a union member, up to US$211 per union member
- SGUnited Jobs that pledges for 10,000 jobs available over the next year
- SGUnited Traineeships, which seeks to support employers in providing traineeships to fresh graduates entering the labour force to help boost employability for new graduates, and courses support through SkillsFuture Credit.
- And greater flexibility on government fees and loans.
The sectors to benefit from the Resilience Budget are aviation; tourism; meetings, incentives, conferences, exhibitions (MICE) venue operators; food; and land transport such as taxi and private hire cars, as well as art and culture.
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The type of reliefs provided to help people cope with the effect of the pandemic are varied — from wage offset, special relief payments, loans, subsidies, tax rebate up to a year and parking waiver for up to six months, support package, to digitisation efforts.
One of the tech angles of the Resilience Budget -aside from supports in forms of waivers and rebates as well as fund for those who are eligible- is the support in capability development. The Deputy PM announced the support for both ready-to-adopt and advanced digital solutions that reduce face-to-face contact.
Deputy Prime Minister Heng underlined that the government will enhance training support, comprising higher course fee subsidies and absentee payroll support, to more sectors and till end-2020.
Positive responses from tech community
e27 approached several tech companies in the country seeking their comments on the Resilience Budget.
According to Singapore Association of Convention and Exhibition Organisers and Suppliers (SACEOS), the Resilience budget is a welcome move as it is vital to the MICE community.
“The announcement of key measures to protect livelihoods, save jobs and support enterprises shows that the government understands the difficulties that the MICE community is facing as a result of the continued impact of COVID-19 on the Singaporean economy and has taken important steps to address the impacts on our members,” it said in a statement.
“The expansion, extension, and enhancement of wage support measures in the jobs support scheme to 75 per cent of wages will help workers and business owners in our community survive COVID-19 and retain the capability to rebound quickly in the recovery that follows. The support for self-employed persons will also provide valuable support to freelancers in the MICE community,” the statement reads.
Furthermore, SACEOS also mentioned the measures to ease business cash flow by deferring income tax payments for three months as something that will relieve immediate pressure on business owners in the short-term.
Property tax exemptions will also reduce overheads and respond to a key concern held by the MICE community. Changes to the enterprise financing scheme including increased credit limits and deferred payment schedules will make credit more available and affordable for companies to maintain their capabilities throughout the crisis and into the recovery.
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Taken together, these measures will enable SACEOS members to retain staff and maintain business viability throughout the ongoing crisis.
As a response, SACEOS said it will embrace capability-building initiatives to make the Singaporean economy more resilient, digital-ready, and innovative throughout recovery. It will also provide itself as a point of contact on detailed advice to navigate any help SACEOS members might need with the Resilience budget.
Lien Choong Luen, General Manager, gojek Singapore, said the stimulus package and the additional support that will be rendered to private-hire operators and drivers is a good move.
“The extension of the point-to-point operator license fee waiver by the Land Transport Authority is a helpful move for the industry. We believe that a further postponement of the ride-hail service operator license start date would allow operators like gojek to focus more of our efforts on assisting drivers and addressing business and operational challenges,” he explained.
“Similarly for our driver-partners, the extension of the government’s Special Relief Fund would be essential to further help them minimise their financial burden,” Lien continued.
gojek remains hopeful by operating on its mission of safety movement.
Therefore, to provide for a safer ride environment, gojek has been distributing masks, hand sanitisers, and anti-bacterial wipes to its driver-partners since January.
The ride-hailing giant has also been providing education to driver-partners and commuters on the precautions they can take, such as increasing ventilation of the car by not using the recirculation mode of the car’s air-conditioning system, and observing good hygiene practices such as regularly sanitising high-human contact points such as door handles.
Nisha Paramjothi, Senior Vice President, Investments & Strategy, fintech startup MatchMove, said.
“It is heartening to see the government’s swift actions in rolling out the Resilience Budget targeted at job retention with the Job Support and Wage Credit Schemes. While saving jobs is important, it is equally essential to prepare students and the current workforce alike for jobs of the future. Programmes like SGUnited Traineeships and SGUnited Job Initiatives can help Singaporeans find employment, learn new skills, and gain work experience,” Paramjothi added.
“Given the dynamic fintech landscape in Singapore with the upcoming launch of digital banks in Singapore, we anticipate more jobs to be created,” she continued, adding that in sync with what the Resilience Budget is apparently aiming, the company recently launched the MatchMove FinTech Academy to support the development of digital talent to enable a new level of innovation and nurture a foundation for future fintech talent in Singapore.
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Finaxar, a small business-focussed fintech company, also lends its insights. Vihang Patel, Co-founder and CEO of Finaxar, said: “The Resilience Budget sees enhanced schemes such as EFS and support from MAS that will undoubtedly provide a shot of confidence for SMEs.”
“In response, Finaxar is launching new measures such as a working capital line with a longer repayment period to lighten the burden and a supplier financing line to ensure that our local supply chains are well supported. Our clients are also working closely with their existing customers to ensure that they are able to meet their financial obligations through various loan restructuring plans where required,” he said.
Fintech firm oCap, that offers access to sustainable, fast, flexible, and affordable financing solutions, also shared how the Resilience Budget might impact its business.
oCap’s CEO Carlos Haeuser said: “The Budget has been designed to provide relief and strengthen the capacity of businesses in order to recover quickly from the impact of the pandemic. From a business survival standpoint, the ability to pay wages and cover operating expenses has become crucial. The expansions to the SME Working Capital Loan and Temporary Bridging Loan Programme will ensure that all businesses will continue to have access to credit.”
Overall, the responses of the tech community in Singapore has been positive. Singapore can be the beacon of hope on what a nation can and should aspire to achieve to come out together whole, leaving no one and no industry behind.
It’s all about supporting each other in tough times and with the speed of how the Resilience Budget was designed to adjust with the nation’s need, the rest of Southeast Asia, even the world can learn a thing or two in doing their best and doing their part in protecting the country from the collapsing economy.
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Photo by Peter Nguyen on Unsplash
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