THIS year's $20.5 billion Budget is a 'very decisive Budget' which aims to help see Singaporeans through difficult economic times ahead, Prime Minister Lee Hsien Loong has said.

And while it offers a variety of help measures for employers, he noted that individuals and less well-off households were not left out.

A STRONG SIGNAL The move to tap the reserves for $4.9 billion was 'a signal to Singaporeans that we are attacking this problem with all of the weapons at our disposal', said PM Lee. 'I think that's a strong signal. Having done this, let's give it some time before we reassess the situation.'

The assistance they were receiving was 'not a small amount', he said on Monday after visiting employees at pharmaceutical giant GlaxoSmithKline (GSK).

'We know that things are going to be tough. The Budget is crafted with this scenario in mind...(We're) not expecting (things) suddenly to turn around just because we've had the Budget,' he added.

Last Thursday, the Government announced a $20.5 billion package to save jobs and cut costs as Singapore braces itself for its worst recession since independence.

The Government sought and obtained in-principle approval from the President to draw $4.9 billion from the reserves.

This is to fund two special programmes: a Jobs Credit scheme to subsidise part of the wage bill of employers; and another to encourage banks to lend more freely to viable businesses.

Asked if there would be off-Budget measures to boost the economy, PM Lee said it was too early to tell.

'We take it one step at a time,' he said. 'We've taken some time to put together this Budget. We had a few months since September when the American financial system started going visibly and seriously out of kilter, and we spent the last few months assessing the situation, deciding what best will fit our circumstances, what the economy needs most.'

The Government would have to watch developments in America and Europe over the next six to nine months, he said, adding that it was assessing the situation 'constantly and very carefully'.

'So if we need to do more, we can do more,' he said.

He added that with the current Budget, the Government had chosen to 'make a decisive move and then monitor for some time', rather than 'do a little bit and then after a while do a little bit more'.

'This way, there's an impact. Everybody knows where we stand.'

At about 8 per cent of gross domestic product (GDP), Singapore's Budget package is significant compared to elsewhere.

The proposed US$825 billion (S$1.24 trillion) expansionary fiscal package in America over two years, for instance, amounts to about 6 per cent of GDP. Stimulus plans announced by Germany amount to 1 per cent of GDP, and Taiwan plans to spend 4 per cent of GDP spread over four years.

Noting that some Singaporeans wished they had received more direct help, he said there was quite a significant package for households. What they would get was 'not a small amount'.

The Budget that was announced on Thursday set aside a total of $2.6 billion towards enhanced GST offsets and Workfare payments, and other measures to help households.

'We'll see how things go over the next few months,' Mr Lee added.

As for comments that the new Jobs Credit scheme favoured employers, PM Lee said that in helping companies cut costs, the Government was helping workers keep their jobs.

The Jobs Credit scheme gives bosses a 12 per cent cash grant on the first $2,500 of wages for every worker on their CPF payroll.

Asked if the Government would dip into the reserves for further stimulus, PM Lee said it was premature to say.

The move to tap the reserves for $4.9 billion was 'a signal to Singaporeans that we are attacking this problem with all of the weapons at our disposal', he said.

'I think that's a strong signal. Having done this, let's give it some time before we reassess the situation.'

He added that he was glad some Singaporeans had expressed concern about the move to dip into the reserves. It showed they understood that the reserves should not be spent frivolously, but protected and used only in very dire circumstances.

He cited a recent cartoon in the Lianhe Zaobao newspaper showing a woman filling hongbao packets with money from a safe which she had opened. Three children are peeking into the room, and the thought bubble from one of them reads: 'This hongbao is rather big.'

Said PM Lee: 'We are taking a little bit out, we must use it carefully.'

He was also cheered that unionists and workers felt that with Government-initiated programmes like Jobs Credit and Spur - the programme to foot a portion of the salaries of workers undergoing training - Singapore could distinguish itself from other countries by maintaining a cordial relationship between employers, unions and Government.

'So we deal with this problem as one team. You have to do that,' said PM Lee, who was accompanied on the visit by labour chief Lim Swee Say and unionists.

'We've gone through these (storms) before. This is a bigger one, but it's not our first battle. Let's fight it together,' he said.

zakirh@sph.com.sg