Lower-wage workers will receive higher payouts under a government scheme to help them supplement their income and Central Provident Fund (CPF) savings.
The qualifying income cap for the Workfare Income Supplement (WIS) programme will also be raised from the current $2,000 to $2,300 per month, Finance Minister Heng Swee Keat announced yesterday.
With the enhanced WIS, to take effect from January next year, the maximum annual payouts will be increased by up to $400, and older workers will see higher increases in payouts. Those eligible for WIS receive payout amounts based on their age and income.
For example, 60-year-old workers earning $1,200 a month can currently receive $3,600 annually from WIS, but with the enhancement, this will be boosted to $4,000. They will continue to receive 40 per cent of WIS in cash and 60 per cent in their CPF.
WIS, which was introduced in 2007, is a key pillar of Singapore's social security system and supports workers whose earnings are in the bottom 20 per cent, as well as those slightly above.
Mr Heng said: "The scheme has raised their incomes, encouraged employment and helped them save more for retirement."
He said the enhanced WIS is expected to cost close to $1 billion a year, and will benefit almost 440,000 Singaporeans.
Meanwhile, to support older workers, the Special Employment Credit (SEC) and the Additional SEC scheme, which incentivise and encourage employers to hire senior workers, will both be extended for another year, until Dec 31 next year.
The SEC subsidises the wages of Singaporean workers aged 55 and above who earn up to $4,000 a month, while the Additional SEC encourages companies to hire workers who are above the re-employment age of 67.
To support the extensions, the SEC fund will be topped up by $366 million, Mr Heng noted.
He said a tripartite workgroup set up to study the concerns of older workers will present its recommendations later this year.
The workgroup is reviewing policies such as the retirement and re-employment age, and CPF contribution rates for older workers.
The Government will also review the relevance and structure of the SEC and Additional SEC, in tandem with recommendations from the tripartite workgroup.
"With a tighter labour market, and more Singaporeans choosing to work longer, more companies will be hiring older workers. The Government will study better forms of support to continue to help workers to remain productive, earn more and save more for retirement," he said.
Yesterday, Mr Heng also announced a $1.1 billion Bicentennial Bonus for Singaporeans. As part of it, lower-income Singaporeans will receive additional payments from the WIS at the end of this year, to help them with daily living expenses.
The Workfare Bicentennial Bonus will give these individuals an additional 10 per cent of their WIS payment for work done last year, with a minimum payment of $100. This will be given in cash.