BUDGET 2019: Responding to the Budget

Focus on boosting digital skills, reskilling workforce welcomed

The 2019 Budget is focused on accelerating the development of digital skills and adoption of innovative solutions, strengthening cyber security and reskilling the workforce in the face of slowing global growth and technological disruptions, business leaders say.

Mr Christian de Guzman, vice-president - senior credit officer of Moody's Investors Service, said: "Against the backdrop of a deteriorating external environment, the mildly expansionary Budget... provides some support to growth, with room for manoeuvre in the event of a prolonged slowdown.

"The restated commitment to avoid borrowing and to use revenue enhancements, such as higher GST (goods and services tax) rates, to finance these larger long-term spending commitments help to preserve Singapore's structurally robust fiscal position."

The focus on building deep enterprise and worker capability should help sharpen Singapore's global competitive edge amid rising protectionism.

Nanyang Technological University's Professor Tan Yong Kam said: "Asean will become the fourth-largest economy in the world by 2030. And Indonesia has become a more important external engine of growth for Singapore. We can position ourselves to soar with the rising regional wind."

Precursor Group managing director Tan Khoon Guan pointed out that by moving away from providing short-term benefits such as tax or cash rebates, Budget 2019's focus is on ensuring that businesses and employees stay relevant.

The introduction of customised support programmes such as Scale-up SG, and Innovation Agents, a two-year pilot to help firms tap industry professionals for opportunities to innovate and commercialise technology, could help local firms deepen their capabilities and internationalise. This, in turn, will generate good jobs and wage growth for local workers, the Singapore Business Federation said.

Singapore FinTech Association president Chia Hock Lai said: "Scale-up SG will increase the chance of producing Singapore-based tech unicorns, while Innovation Agents will increase the chances of success for tech start-ups."

In addition, local enterprises can also look forward to easier access to financing. Precursor's Mr Tan said the setting up of the SME Co-Investment Fund III will make more funds available, the SME Working Capital Loan scheme is being extended, while the introduction of the Enterprise Financing Scheme will streamline existing small and medium-sized enterprise (SME) financing initiatives.

Expanding the coverage of SMEs Go Digital will boost technology adoption by SMEs, while extending the Enterprise Development Grant and enhancing the Productivity Solutions Grant will promote innovation.

Corporate tax director Irene Tai of PwC Singapore said: "The streamlining of financing schemes... should also allow Enterprise Singapore to channel the funds to where they are most needed."

KPMG head of enterprise market Jonathan Ho noted that the Government is "taking up to 70 per cent risk on bank loans to companies less than five years old, and the extension of the SME Working Capital Loan scheme will help catalyse start-ups with innovative ideas".

Mr Daryl Pereira, KPMG's head of cyber security, management consulting, said government support could also have been extended to help businesses address cyberthreats through tax incentives or grants to adopt stronger cyber-security practices.

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A version of this article appeared in the print edition of The Straits Times on February 19, 2019, with the headline Focus on boosting digital skills, reskilling workforce welcomed. Subscribe