Foreign worker levy rebate for essential sectors extended till March next year

The rebate will be for all work permit holders in the construction, marine shipyard and process sectors. ST PHOTO: KUA CHEE SIONG

SINGAPORE - A $250 foreign worker levy rebate will be extended until March next year for all work permit holders in the construction, marine shipyard and process sectors, the Ministry of Manpower (MOM) said in a statement on Tuesday (Dec 21).

The rebate, which was introduced last year to help the sectors tide over the challenges caused by Covid-19, was due to expire this month.

MOM noted that these sectors continue to face manpower shortages and increased costs, adding that the extension will help about 15,000 companies.

Employers can consider using the rebate to retain existing workers and bring in work permit holders from lower-risk countries or regions, it said.

The extension was announced amid a pickup in the inflow of workers in these sectors in recent weeks. As such, a decision will be made "closer to March 2022" after ascertaining if there is a need to further extend the rebate.

In the meantime, MOM encouraged firms "to press on with longer-term productivity improvements to become more manpower-lean and resilient against future manpower disruptions".

Meanwhile, an existing waiver of the foreign worker levy for all foreign workers, including maids, will also be extended till December next year. The waiver was also due to end this month.

The levy will be waived for the duration of their stay-home notices and residential onboarding programme at migrant worker onboarding centres.

The extension can help employers manage the costs associated with border measures and safeguards, MOM said.

Associations in the construction, marine shipyard and process sectors welcomed the move.

Mr Wayne Yap, executive director of the Association of Process Industry said this was a timely move as the operating environment for businesses has become more challenging as a result of Covid-19.

“The inflow of workers into Singapore is largely calibrated, and our member companies are not really operating with the optimum headcount. The extension can help businesses tide through this challenging period,” he said.

Mr Ian Teo, president of the Micro Builders Association, Singapore, agreed that the extension will bring relief to companies in the construction sector given the rising costs of materials and labour.

But more can be done, Mr Teo added. He said many companies also have concerns about the sub-dependency ratio ceiling for S Pass holders in the manufacturing sector, which will be reduced from 20 per cent to 18 per cent from January 2022. 

The sub-dependency ratio ceiling refers to the maximum permitted ratio of foreign workers to the total workforce that a company in the stipulated sector is allowed to hire, according to MOM.

“Many firms are not only facing labour shortage but (also face) increasing difficulties in operating due to the tightening of the sub-dependency ratio ceiling. We hope that the Government considers delaying the implementation of the reduction,” said Mr Teo.

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