Deputy Prime Minister (DPM) Heng Swee Keat has just announced Singapore’s budget for the financial year 2021. Known as the “Emerging Stronger Together” budget, this year’s budget comes after 4 budgets were pushed out last year to cushion the impact of the COVID-19 pandemic.
This year’s budget focuses on helping those whose jobs were affected by the pandemic, and the support will be more targeted towards sectors that were hit hardest. There is a focus on working towards developing Singapore into a sustainable country, and more details on the newly announced Singapore Green Plan 2030 were also announced.
A 3-prong $11 billion COVID-19 Resilience package was announced to address immediate needs Singapore might face while fighting the pandemic, and this includes safeguarding public health, supporting workers and business affected and re-opening Singapore safely. $4.8 billion will go towards looking after public health, including providing free vaccination for those eligible. $5 billion will go towards supporting businesses and workers, with $2.8 billion allocated to the extension of the Job Support Scheme (JSS).
What are the key takeaways from the Budget 2021?
DPM Heng Swee Keat’s 2-hour speech included details on how this year’s budget aims to continue supporting Singaporeans through the COVID-19 pandemic, as well as steps Singapore will take to continue developing as a nation.
Here are 11 key takeaways from the Budget 2021 to take note of.
1. The Job Support Scheme (JSS) will continue for certain industries
The JSS, which was introduced in 2020 to help cushion the impact of COVID-19, will continue across various sectors, with the amount subsidised by the government differing across the 3 tiers.
2. Support for Workers & Individuals will proceed
Certain initiatives under the SGUnited Jobs and Skills packaged will be extended, to facilitate the movement of workers to jobs in growth areas. The COVID-19 Recovery Grant will also continue for those who have become unemployed or faced a significant loss of income.
3. Development of intellectual property strategy
The Singapore Intellectual Property Strategy 2030 was announced, which aims to help businesses by providing tools that will protect their intellectual property and intangible assets. Efforts will also be made to train professionals for this role. More details will be announced on World IP Day in April 2021.
4. Jobs and Skills Package will continue
An additional $5.4 billion has been allocated to the Jobs and Skills Package, with $5.2 billion going towards the Jobs Growth Incentive (JGI). These programmes aim to provide new jobs and traineeships for those looking for employment opportunities while allowing job-seekers to upgrade their skills. This next phase aims to support the hiring of 200,000 locals, as well as 35,000 traineeship positions in 2021.
5. Enhancement of salaries for healthcare workers
To show appreciation for Singapore’s healthcare workers, the government will enhance the salaries of nurses and other healthcare workers such as support care staff. This will apply to those working in both the public and private sector.
6. Wage Credit Scheme and Capability Transfer Programme to be extended
To support the hiring of locals, the Wage Credit Scheme will be extended for 1 year, with a co-funding level of 15%. The Capability Transfer Programme will be extended until September 2024.
7. Household Support Package to support families
A new Household Support Package will provide support for all families, with lower and middle-income families receiving more support. The package is estimated to cost $900 million and includes additional vouchers for individuals and families.
8. Support for low-wage and older workers and persons with disabilities
1,200 job and training opportunities will be developed for persons with disabilities, and a $200 million budget has been allocated to support the Senior Worker Support Package, Senior Worker Early Adopter Grant and Part-Time Re-employment Grant.
9. Petrol duty to be raised with immediate effect
Petrol duty will be raised by 15¢ per litre for premium patrol, and 10¢ per litre for intermediate petrol. The raise will take place with immediate effect. Support will be provided for motorists, especially those who rely on vehicles for their livelihood. All rebates will take effect from 1 Aug 2021, with more details to come.
10. GST to increase from 7% to 9% sometime between 2022-2025
The GST hike will not happen this year but is expected to happen sooner rather than later, subject to Singapore’s economic outlook. $6 billion has been set aside for an Assurance Package to cushion the impact for Singaporeans.
11. GST to be extended to low-value import goods from 2023
Low-value goods worth $400 or less imported by air or post will be subjected to GST with effect from 1 Jan 2023, with the government reviewing international developments on how to implement this. More details will be announced in the future.
For more details on the Budget 2021, please refer here for the full report.
What support will the travel and aviation sector receive?
Over $320 million worth of SingapoRediscover vouchers were given out in December 2020 to Singapore citizens aged 18 and above, aiming to support the tourism sector. Although more than 300,00 Singaporeans have used their vouchers, this year’s budget is providing additional support for one of the hardest-hit industries.
For those working in the aviation, aerospace and tourism industries, the JSS will continue to be extended until September 2021. A 30% wage support will be provided from April to June 2021, and 10% wage support from July to September 2021.
An additional $870 million has also been set aside to support the aviation sector, to prepare the industry for recovery as well as upgrade its capabilities. This includes testing new technology at Changi Airport, which will improve on-arrival testing and quicker verification of digital COVID-19 test results and vaccination records.
What does this mean for me as an individual / household?
Aside from the usual GST vouchers, individuals and households will receive additional support from the government under the Budget 2021.
The package includes the following:
Additional one-off $200 GST cash voucher for Singaporeans eligible for the GST Voucher - Cash
Additional 50% U-Save rebate over 1 year for eligible Housing Board households, ranging between $120-$200
1-year extension of the service and conservancy charges for all eligible HDB households, with the rebate ranging between 1.5-3.5 months
An additional top-up of $200 via the Child Development Account, Edusave Account or Post-Secondary Education Account for Singaporean families with children below the age of 21
Each household will receive a $100 Community Development Council Voucher, which can be used at heartland shops and hawker centres