The Work Support Programme and other existing financial assistance schemes do provide cash assistance to needy low-wage workers and their families.

The Workfare Income Supplement (WIS) scheme serves a different purpose by helping low-wage workers save more CPF through work. This is important as low- wage workers and their families also need to draw from their CPF for medical, housing and retirement purposes. When the WIS was introduced, their contribution rates were also reduced, to increase their take-home pay.

For the formally employed, about 30 cents of every dollar from the WIS will be paid in cash. But this is only fair because employees contribute up to 20 per cent of their wages to CPF. The self-employed need contribute only up to 8.5 per cent of their wages to their Medisave. In return, they receive WIS of up to 16 per cent of their wages, but paid fully in CPF.

The Ministry of Manpower and the CPF Board are working together with unions, employers and grassroots organisations to help low-wage workers receive the WIS. The CPF Board has also stepped up its enforcement efforts, which from January to August last year resulted in employers starting to contribute CPF for more than 22,000 workers. More workers can therefore now benefit from the WIS. An additional 15,000 formal employees aged above 45 years old have received the WIS so far, compared to under the previous Workfare Bonus Scheme.

Jean Tan (Ms)
Director, Corporate Communications
for Permanent Secretary
Ministry of Manpower