Budget debate: President and ministers to take 1-month pay cut; special bonus for front-line public officers tackling Covid-19

In a photo taken on Jan 28, 2020, medical staff are seen wearing masks around the premises of the National Centre for Infectious Diseases.
In a photo taken on Jan 28, 2020, medical staff are seen wearing masks around the premises of the National Centre for Infectious Diseases.ST PHOTO: KEVIN LIM

SINGAPORE - The President, all Cabinet ministers - including the Prime Minister - and political office-holders will take a one-month pay cut in solidarity with Singaporeans coping with the coronavirus outbreak, Deputy Prime Minister Heng Swee Keat said on Friday (Feb 28).

Public officers manning the front line in Singapore's battle against the coronavirus outbreak will also get up to one extra month of special bonus, he added.

The front-line workers will include many healthcare officers in restructured hospitals and the Health Ministry, as well as some officers in other front-line agencies who have been directly involved in fighting the Covid-19 disease, he told Parliament.

Other public officers who have contributed significantly will be recognised appropriately, he said. A one-off Covid-19 grant will also be given to the 900 general practitioner clinics that have been designated Public Health Preparedness Clinics, to support them in their efforts to care for patients with respiratory symptoms. 

"Our front-line workers, especially healthcare workers in the restructured hospitals, have shown outstanding courage and dedication. They are out there making daily sacrifices to fight this war against the unknown," said Mr Heng.

"While we cannot thank them enough, we can show our appreciation and support in a tangible way," he added in a speech rounding up three days of debate on this year's Budget.

President Halimah Yacob, as well as Singapore's political leaders, will also do their part to show solidarity with citizens affected by the outbreak, he said. Recent weeks have seen sectors from hospitality to tourism and retail sharply affected by the slowdown in arrivals.

All political office-holders will take a one-month cut in their salary, while all MPs will take a one-month cut in their allowance. Some senior public service officers will also take a half-month pay cut.

The move follows calls by several MPs to do more to support front-line workers, including Nominated MP Walter Theseira. He  had  called on the Government to give low-wage workers on the frontlines of combating Covid-19 more pay, by restructuring jobs with higher wages, including those held by MPs who are leaders in their professions.

SINGAPORE READY TO FACE LONGER VIRUS IMPACT

This year's Budget debate takes place under "exceptional circumstances", Mr Heng said, with businesses, workers and households facing both the softening of the global economy and sudden virus outbreak.

Responding to MPs including Ms Denise Phua (Jalan Besar GRC) and Dr Teo Ho Pin (Bukit Panjang) who asked whether the Government could provide businesses with more sizeable and lengthier support, Mr Heng said the hope was that this would not become necessary.

"But if it does, for example if the outbreak becomes a worldwide pandemic, and the global economic impact is deeper and longer, we have the fiscal resources to do so, and the will to act," said Mr Heng, who is also Finance Minister.

For now, however, the overall size of spending in this year's Budget is appropriate and accounts for both the global slowdown and wider uncertainties, he said.

 
 
 

It has been calibrated to put sufficient purchasing power back into the economy and inject a boost of confidence, Mr Heng added.

The $1.6 billion Care and Support Package for households and $4 billion Stabilisation and Support Package for businesses and employees is aimed at cushioning the significant impact that the virus has had on Singapore, with targeted support for those who need it most, he said.

The Government's top priority is preserving and enhancing jobs. Greater job assurance will encourage workers to go for training and avoid deep cuts in consumption, said Mr Heng.

Small and medium-sized enterprises (SMEs), which employ the bulk of local workers, are a key focus of the two biggest measures in the Stabilisation and Support Package, he added. "As a percentage of revenue, SMEs will receive payouts that are on average five times as much as the average for all enterprises."

An additional $400 million is also being doled out to the hardest-hit tourism, accommodation, and aviation sectors, on top of broad-based measures for all companies that include corporate income tax rebates.

Taxi and private-hire car drivers, hawkers, tourist guides, retailers and food and beverage operators who have felt the ripple effects have also been allotted an extra $200 million to help them tide over this period, said Mr Heng.

MORE SUPPORT FOR FREELANCERS, FASTER PAYOUTS FOR JOBS SUPPORT SCHEME

Responding to Mr Desmond Choo (Tampines GRC), Ms Tin Pei Ling (MacPherson) and Mr Gan Thiam Poh (Ang Mo Kio GRC), who had asked whether more could be done for other groups of self-employed workers and freelancers, Mr Heng said that details will be announced by the ministries at a later date.

Several MPs, including Mr Seah Kian Peng (Marine Parade GRC), had also asked whether payouts for the Jobs Support Scheme, which will offset 8 per cent of wages for every local worker for three months, could be brought forward from the end of July.

Smaller companies are already struggling to stay afloat and may not be able to survive that long, they said.

In his reply, Mr Heng said that the disbursement of payouts for this scheme are operationally complex. The agencies involved have redoubled their efforts, however, and are now aiming to bring forward payment to end-May.

 
 
 

Addressing the timeliness of the support for firms, Mr Heng said that the measures in the Stabilisation and Support Package must be considered in totality.

Enhancements to the Wage Credit Scheme, which currently co-funds wage increases for Singaporean employees earning a gross monthly wage of up to $4,000, will be provided in the second half of the year to spread out support for enterprises in a more sustained way, he said.

Commercial landlords who qualify for property tax rebates will receive their revised tax bills in April, and refunds of any excess property tax by the end of May.

Landlords such as CapitaLand and Frasers Property have already promised to pass on the savings to their tenants.

Firms will get their revised tax bills, which will take into account the corporate income tax rebate, by the end of March.

Rental waivers for government commercial tenants will largely apply to the months of March and April, he added.

"These will provide not just financial relief but also help with enterprises' shorter-term cash flow needs."

COLLECTIVE EFFORT

While these measures are in place, all Singaporeans must play their part to help overcome the challenges posed by the virus, Mr Heng stressed.

Some individuals have already stepped up by setting up funds for businesses hit by the outbreak, volunteering to distribute masks and hand sanitisers to seniors and vulnerable residents, and sending cards and care packages to front-line healthcare workers, he noted.

 
 
 

Landlords, business associations and senior management members have also demonstrated their support.

"How we respond to moments of challenge and crisis is a test of our individual resilience and the strength of our character," he said.

"Even more, it is a test of our social cohesion and solidarity. It is a test of who we are as a people, and as a nation. Do we panic and become self-centred, or do we stay calm, band together, and look after one another?"

Mr Heng said he is confident that Singaporeans will rally together to confront the challenges head on, and emerge stronger and more united.

"In the weeks and months to come, we will need to draw deeply on Singapore's reserves of resilience, trust and solidarity. This unity of purpose across our whole society is what will see us through these challenging times," he said.