There were episodes in the centuries of Singapore's history where our island's fortunes waned due to external forces. These are sobering reminders that we have to constantly build up our security and resilience, and plan long term.
Singapore's success has roots in our port, which thrives on openness and connectivity. These traits have been forged into our identity as a people... We turn our size and strategic location into an advantage...
Like Sang Kancil, the small but quick-witted mousedeer, we can make our way in the world.
FINANCE MINISTER HENG SWEE KEAT
Lower-wage, older workers
At the heart of Singapore's economic transformation are workers, said Finance Minister Heng Swee Keat. "Our ultimate goal is to enable our people to continue to have good jobs and opportunities, and to be at their best."
A range of support measures have been rolled out in previous years to help workers reach their fullest potential, he noted.
Yesterday, he announced that lower-wage workers will get higher payouts under the Workfare Income Supplement (WIS) next year.
Aimed at helping them supplement their income and Central Provident Fund savings, the enhanced WIS will see their maximum annual payouts increase by up to $400. This will take effect from January next year.
The qualifying income cap for the programme will also be raised from the current $2,000 to $2,300 a month. Older workers will continue to get higher payouts than younger workers.
The higher WIS payouts will cost an additional $206 million a year, bringing the total cost of the programme to $1 billion a year. Almost 440,000 Singaporeans stand to benefit from this.
Meanwhile, the Special Employment Credit (SEC) and Additional SEC schemes, which incentivise and encourage employers to hire senior workers, will both be extended for another year, until Dec 31, 2020. The SEC scheme subsidises the wages of Singaporean workers aged 55 and above who earn up to $4,000 a month, while the Additional SEC scheme 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.
Other worker initiatives include an additional WIS payment of at least $100 for lower-income workers as part of the Bicentennial Bonus.
To help mid-career workers take up jobs in new growth areas, more Professional Conversion Programmes will be launched in blockchain, embedded software and prefabrication.
The Career Support Programme, which provides wage support for companies that hire mature and retrenched Singaporeans or those in long-term unemployment, will also be extended by two years.
Small and medium-sized enterprises (SMEs) got quite a lot of attention at yesterday's Budget, with the Finance Minister talking about supporting start-ups, enabling firms to scale up and how Singapore must adopt an "enterprise-centric" approach.
Chief among the initiatives announced was a Scale-up SG programme which trade promotion agency Enterprise Singapore (ESG) will launch together with the private and public sectors. This will help high-growth local firms identify how they can innovate, grow and venture overseas. ESG will also run a two-year pilot to help firms get advice on innovation opportunities and ways to commercialise technology from experts known as "Innovation Agents".
To catalyse investment in Singapore-based SMEs that are ready to scale up, an additional $100 million will be set aside for a new SME Co-Investment Fund III.
The eight financing programmes offered by ESG will also be streamlined into a single Enterprise Financing Scheme to be launched in October. This covers trade, working capital, fixed assets, venture debt, mergers and acquisitions and project financing.
The Government will also expand the SMEs Go Digital programme to cover a larger number and a wider range of cost-effective, pre-approved digital solutions. This programme aims to help SMEs adopt digital technologies.
Three sectors - accountancy, sea transport and construction - will also get their own industry digital plans, with more sectors to be added later.
But it was not all good news for small and medium-sized enterprises. In the service sector, the Government will be tightening the Dependency Ratio Ceiling, or the proportion of foreign workers a firm can employ.
This will go from 40 per cent to 38 per cent on Jan 1 next year, and to 35 per cent on Jan 1, 2021.
For the subset of S Pass workers - mid-skilled foreigners earning at least $2,300 a month - the quota will be cut from 15 per cent to 13 per cent on Jan 1 next year, and to 10 per cent on Jan 1, 2021.
Large companies will get more help to tap emerging opportunities as Singapore positions itself as a "Global-Asia node of technology, innovation and enterprise", said Finance Minister Heng Swee Keat.
Singapore should be "Asia 101" for global multinational companies looking to expand into Asia, he said.
At the same time, Singapore can be "Global 101" for regional companies ready to go international.
To draw greater value from trade networks, the Government will streamline and digitise trade processes further to raise efficiency. In this way, companies can get easier access to overseas markets and make better use of free trade agreements.
To encourage firms to embark on large-scale automation projects and raise productivity, the Automation Support Package will be extended for another two years, up to March 31, 2021.
This includes an Investment Allowance of 100 per cent on the amount of approved capital expenditure, net of grants. The approved capital expenditure is capped at $10 million per project.
Just like for smaller businesses, larger companies will have to brace themselves for the tightening of the Dependency Ratio Ceiling (DRC) in the service sector. DRC is the proportion of foreign workers a firm can employ, from 40 per cent to 38 per cent on Jan 1 next year, and to 35 per cent on Jan 1, 2021.
For the subset of S Pass workers, the quota will be cut from 15 per cent to 13 per cent on Jan 1 next year, and to 10 per cent on Jan 1, 2021.
Families with young children
Parents with school-going children will benefit from the Bicentennial Bonus, with additional support for their children's education.
There will be a one-off $150 top-up to the Edusave accounts of primary and secondary school students aged seven to 16.
This is in addition to the annual Edusave contributions they already get from the Government, which this year will be $230 for primary school pupils and $290 for secondary students.
Students aged between 17 and 20 will get a one-off top-up to their Post-Secondary Education Accounts of either $250 or $500, depending on the value of their home.
The top-ups are expected to be made by mid-2019 and will benefit about 570,000 students. They are estimated to cost the Government $140 million.
Finance Minister Heng Swee Keat also pointed out that the Government has been spending more on early education and care. It spent about $1 billion in the pre-school sector last year, more than 21/2 times the $360 million in 2012.
This support continues as a child grows, with the Government subsidising over 90 per cent of a child's education. "This means that a child entering primary school in 2018 will receive over $130,000 in education subsidies by the time he or she completes secondary education," he said.
Children from lower-income homes get even more support through various schemes.
The much-awaited goodies for the Merdeka Generation - Singaporeans born from 1950 to 1959 - were announced yesterday, and those in their 60s will have something to smile about.
They get five key items:
• A $100 top-up to PAssion Silver cards, which can be used for healthy lifestyle activities like sports
• A yearly Medisave top-up of $200 till 2023
• Additional subsidies for outpatient care for life
• Additional MediShield Life premium subsidies for life
• An additional participation incentive of $1,500 for those who join CareShield Life.
To qualify, they must have become a citizen by 1996.
Those who were born before 1950 and missed out on the Pioneer Generation Package, but who became citizens by 1996, will also be eligible.
In addition, as part of the $1.1 billion Bicentennial Bonus, Singaporeans aged 50 to 64 years old this year will get a CPF top-up of up to $1,000, if they have less than $60,000 of retirement savings in their CPF accounts.
And older workers who are on the Workfare Income Supplement scheme will get higher increases in annual payouts from January next year. Those aged 60 and older will be able to get up to $4,000 a year in payouts.
Lower-income Singaporeans continue to feature prominently in this year's Budget, with measures to commemorate the bicentennial geared largely to this group.
A $200 million Bicentennial Community Fund will be set up to encourage Singaporeans to give back to those in need. The fund will provide dollar-to-dollar matching for donations garnered by Institutions of a Public Character (IPCs) this year. The amounts matched will be capped so that more IPCs can benefit from the fund.
A Bicentennial Bonus was ann-ounced, featuring a special Bicentennial Bonus GST Voucher and Workfare Bicentennial Bonus to help the lower-income with daily expenses.
The Bicentennial Bonus GST Voucher will see those with assessable income of up to $28,000 and who are aged 21 and above get $300 if the annual value of their home is up to $13,000, and $150 if it is more than $13,000 and up to $21,000. This will benefit about 1.4 million Singaporeans.
Those who qualify for the Workfare Bicentennial Bonus will get a bonus of 10 per cent of the total annual Workfare Income Supplement payout for 2018.
Those with low CPF balances will also benefit from a top-up of up to $1,000, depending on their age and balance, to help build up their retirement savings. This will cost about $230 million and benefit about 300,000 citizens - the majority of them female.
Households with schoolgoing children will get more support from recently enhanced financial schemes, including the Uplift scholarship for independent schools, which will help cover out-of-pocket expenses.
And families in need of help with transport expenses will continue to be able to tap public transport vouchers, with a top-up to the Public Transport Fund.
Bad news for travellers. Starting today, those returning from abroad will have a smaller allowance on tax-exempt overseas shopping.
Those who spend fewer than 48 hours outside Singapore will now avoid paying the 7 per cent goods and services tax (GST) only if the total value of items bought abroad is $100 or less, down from $150.
The threshold has also been lowered from $600 to $500 for travellers who spend 48 hours or more outside the country.
Meanwhile, the alcohol duty-free allowance for those who spend two days or more overseas will be reduced from 3 litres to 2 litres, starting on April 1.
The moves, which come amid rising international travel, are aimed at keeping Singapore's tax system resilient and contributing to recurrent spending needs.
Something for everyone
All taxpayers will get a personal income tax rebate of 50 per cent, capped at $200 per taxpayer, as part of the Bicentennial Bonus.
Singaporeans who are aged 50 and above in 2019, and who do not receive the Merdeka or Pioneer Generation packages, will also get a Medisave top-up of $100 a year, for the next five years, to help meet future healthcare expenses.
All Housing Board households will also receive rebates to offset between 11/2 and 3 1/2 months of service and conservancy charges, provided they do not have a member owning a private property.
Working mothers who engage the help of their parents, grandparents, or parents-or grandparents-in-law to look after their young children may also claim grandparent caregiver relief if their child is handicapped and unmarried, regardless of age. Currently, the child has to be 12 or below to claim such relief.
Ng Huiwen, Felicia Choo, Rei Kurohi, Toh Ting Wei, Sue-Ann Tan and Tiffany Fumiko Tay
Miel Prudencio Rosales Jr, Chng Choon Hiong
Correction note: This article has been edited for clarity. An earlier version of the article also had a quote that said "a child entering primary school in 2019 will receive over $130,000...". It should be in 2018. We are sorry for the error.