Frontline officers in Covid-19 crisis to get bonus of up to 1 month; cuts for office-holders, MPs

PUBLIC officers on the frontline of the Covid-19 crisis will get a special bonus of up to one month, Deputy Prime Minister and Finance Minister Heng Swee Keat said in Parliament on Friday.

This includes many healthcare officers in the Ministry of Health and restructured hospitals, as well as some officers in other frontline agencies who have been directly involved, said Mr Heng in his round-up speech on the third day of the Budget debate.

In contrast, all political office-holders will get a one-month pay cut, and all members of Parliament (MPs) will also get a one-month cut in their allowance, in the spirit of solidarity. Senior public service officers will take a half-month pay cut, while President Halimah Yacob has said that she will take a one-month pay cut voluntarily, added Mr Heng.

Responding to calls for more help amid the virus outbreak, Mr Heng said the support in Budget 2020 is calibrated for the current situation, with sector-specific support also calibrated for each sector.

But more details of measures are on the way, and some aid will be disbursed ahead of the original target.

Regarding Covid-19, the overall spending in Budget 2020 "is appropriate for now", he said: "We have calibrated it to put sufficient purchasing power back into the economy, while injecting a boost of confidence."

"Our sector-specific measures are calibrated according to the extent to which each sector has been affected," he added, noting that the hardest-hit sectors of tourism, accommodation and aviation will receive over S$400 million in total, in addition to broad-based support.

This will include enhanced absentee payroll support for workers, with further details to be announced by the relevant ministries.

Some S$200 million in additional support has also been given to other affected groups, including taxi and private hire car drivers, hawkers, tourist guides and operators of food and beverage, and retail outlets.

Replying to MPs who asked for more help for the self-employed and freelancers, Mr Heng said the relevant ministries will announce details for these groups subsequently.

Jobs Support Scheme wage offset payouts - originally projected to reach firms by end-July - are now targeted to be paid out by end-May, thanks to redoubled efforts by agencies in checking and validating information. Employers using bank crediting will get the payout about a week earlier.

As for calls to do more for firms and for a longer duration, Mr Heng said that if that becomes necessary, the government has both the fiscal resources to do so, and the will to act. "But for now, let’s go forth and make the fullest use of the support available out there, before we review what more needs to be done."

Beyond the Covid-19 crisis, Mr Heng spoke on Singapore's fiscal approach and the need for the goods and services tax (GST) hike, noting that recurrent spending needs to be funded by recurrent revenues, "not one-off surpluses seen in this term of government, which arose from an unexpected rally in global financial markets, and the unexpected buoyancy in the property market".

A broad-based tax like GST is an appropriate and responsible way to pay for major societal needs such as healthcare. As for concerns about its impact, he noted that the accompanying support package will, in effect, delay the impact of the hike for the majority of Singaporean households for at least five years.

"For lower-income Singaporeans, the offset will be even higher - and hence, there is effectively no increase for them for 10 years," he said.

Foreigners residing in Singapore, tourists and the top 20 per cent of resident households are estimated to account for over 60 per cent of the net GST borne by all households and individuals, even after taking into account GST refunded under the Tourist Refund Scheme, he noted.

As to suggestions of tapping the reserves, Mr Heng reiterated the government's stance that Singapore's reserves are a nest egg that must be stewarded for the sake of future generations.

Among other long-term concerns, he highlighted efforts to tackle climate change: not just by protecting Singapore's coasts, but also by reducing carbon emissions, developing local food production, and developing greener towns.

As for Singapore's economic transformation, the journey has begun bearing fruit, but efforts must continue, he said. This includes addressing structural changes in the labour force and supporting mid-career workers, with the latter issue to be discussed in the Committee of Supply.

Giving a rundown of various new and existing social measures, Mr Heng concluded with a call for unity in both overcoming the Covid-19 outbreak and building a sustainable Singapore full of possibilities, opportunities and care.