Budget 2021 Emerging stronger

Strengthening social cohesion: Aim is to have 'progressive wages' in every sector

Tripartite group looking at raising prospects, wages of low earners making 'good progress'

A workgroup formed last October is making "good progress" on initiatives to increase the wages and career prospects of low-wage workers in every sector of the economy, said Deputy Prime Minister Heng Swee Keat.

The Tripartite Workgroup on Lower-Wage Workers is chaired by Senior Minister of State for Manpower Zaqy Mohamad and includes representatives from the Singapore National Employers Federation (SNEF), union leaders and senior civil servants from agencies involved with low-wage workers.

It aims to give its recommendations by early next year.

"The Government's aspiration is for every sector of the economy to have some form of progressive wages," said DPM Heng yesterday.

"The Tripartite Workgroup is making good progress. The Ministry of Manpower (MOM) will provide details on the approach for expansion later."

Grants for employers who hire older workers beyond the statutory retirement and re-employment ages will also be extended.

About $200 million will be allocated for the Senior Worker Early Adopter Grant and the Part-Time Re-employment Grant, which were introduced in last year's Budget. More details will be out soon.

DPM Heng said take-up rates for both grants have "exceeded expectations", adding: "I thank our businesses for supporting your employees who wish to work longer."

Around 300 employers had received the Senior Worker Early Adopter Grant as at last month while about 240 firms have taken up the Part-time Re-employment Grant, noted SNEF, which manages the grants.

The grants have been adjusted. To be eligible, companies will now need to adopt the Tripartite Standard on Age-Friendly Workplace Practices as an additional requirement for both grants.

Under the updated Senior Worker Early Adopter Grant, companies will get $2,500 per worker aged 60 and above, if their internal retirement and re-employment ages are raised to 65 and 70 respectively. This will be capped at 50 senior workers per company, at a maximum grant amount of $125,000.

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Previously, the grant was capped at $250,000 per company.

Meanwhile, the Part-time Re-employment Grant will be adjusted to provide eligible companies with $2,500 for each senior worker aged 60 and above, capped at 50 workers and $125,000 per company.

Employers must commit to a re-employment policy to provide part-time work to senior workers.

The grants help firms adjust to the impending raises in retirement and re-employment ages next year.

Prime Minister Lee Hsien Loong announced the changes in 2019 as part of a gradual increase that will ultimately set the retirement age at 65 and the re-employment age at 70 by 2030.

The Government and labour movement raised retirement and re-employment ages last month - a year ahead of schedule.

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A version of this article appeared in the print edition of The Straits Times on February 17, 2021, with the headline Strengthening social cohesion: Aim is to have 'progressive wages' in every sector. Subscribe