$33b set aside in Fortitude Budget, bringing Singapore's Covid-19 war chest to nearly $100 billion

SINGAPORE – Deputy Prime Minister Heng Swee Keat on Tuesday (May 26) announced a $33 billion supplementary Budget aimed primarily at helping workers and businesses to tide over the Covid-19 crisis and the bleak economic outlook ahead.

Called the Fortitude Budget, Singapore’s fourth Budget in less than four months sets aside $2.9 billion to extend job protection, including enhancements to the Job Support Scheme (JSS) that co-pays salaries to help firms retain workers. It also provides for the $3.8 billion that went towards measures announced on April 21 to tide Singaporeans over the four-week extension to the circuit breaker.

Together with the earlier Unity, Resilience and Solidarity Budgets, the Government is dedicating close to $100 billion – or nearly 20 per cent of GDP – to support Singaporeans in this battle against Covid-19, said Deputy Prime Minister Heng Swee Keat, who called it “a landmark package, and a necessary response to an unprecedented crisis”.

This Budget requires a draw of $31 billion from past reserves, for which President Halimah Yacob has given in-principle approval. Altogether, the Government is looking at drawing up to a total of $52 billion from past reserves this financial year to enable Singaporeans to tide over this crisis and emerge stronger, said Mr Heng.

Singapore’s economy has been deeply impacted by the global shocks caused by Covid-19, Mr Heng said as he introduced the Budget in Parliament.

He noted that the resident unemployment rate rose to 3.3 per cent in March, the highest in over a decade. The Ministry of Trade and Industry on Tuesday also further downgraded Singapore’s GDP growth forecast this year from -4 per cent to -1 per cent to between -7 per cent and -4 per cent.

But Mr Heng assured Singaporeans that the Government will protect every worker and try to preserve jobs in the midst of this crisis.

To do this, JSS payouts will be extended by one month to provide additional relief for firms as they safely reopen after the circuit breaker period, said Mr Heng, who is also finance minister. This means JSS payments will now be for 10 months, with firms receiving this additional support in October.

In total, the Government will disburse $23.5 billion to firms to support wage costs for 10 months, he said.

Businesses such as retail outlets, gyms and cinemas that cannot resume operations immediately after the circuit breaker period ends on June 1 will continue receiving 75 per cent wage support until August or when they are allowed to reopen, whichever is the earlier.

Firms, such as those in aerospace maintenance, will also be reclassified to a higher tier of JSS support following feedback from industry associations and businesses. Eligible firms will get back payments in July to top-up their previous JSS payouts.

The foreign worker levy waiver and rebate will also be extended for up to two months for businesses not allowed to resume operations on-site immediately after the circuit breaker is lifted on. This includes all firms in the construction, marine and offshore, and process sectors.

Beyond this, the Government will defer the planned increase in CPF contribution rates for senior workers by one year to January 2022, while extending rental relief for small and medium-sized enterprises (SMEs) through a cash grant to be disbursed through property owners.

Mr Heng said the Ministry of Law will introduce a Bill next week mandating that landlords contribute by granting a rental waiver to their SME tenants who have suffered a significant revenue drop in the past few months

As a landlord, the Government will also lead by example by providing two more months of rental waivers for commercial tenants and hawkers, and one more month of rental waiver for industrial, office and agricultural tenants, he added.

Households with at least one Singapore citizen will also get a one-off $100 Solidarity Credit to offset their utility bills, which is on top of the U-Save Special Payment that was previously announced.

Mr Heng also launched an SGUnited Jobs and Skills Package to create close to 100,000 opportunities in three areas: 40,000 jobs, 25,000 traineeships and 30,000 paid skills training places.

“While we will try to preserve jobs in the midst of this crisis, we cannot protect every job,” he said. “However, you have my assurance that the Government will protect every worker.”

“Our promise to workers is this: As long as you are willing to pick up new skills and adapt, to access available opportunities to work or learn, the Government will provide our strongest support to help you,” he said.

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