Government 'will not hesitate' to give more inflation-related help to businesses, workers

SINGAPORE'S government will not hesitate to give more inflation-related help if needed, said Minister for Trade and Industry Gan Kim Yong said in Parliament on Monday (Feb 28).

He was speaking on the first day of the Budget debate, which saw 24 Members of Parliament (MPs) raise concerns ranging from rising costs to climate change.

They, too, had noted in their speeches the concerns over rising cost, be it due to inflation or the future electricity price hikes due to carbon tax.

Gan also touched on the ongoing Russia-Ukraine crisis and its impact on Singapore's economic outlook. He noted that inflationary pressures are likely to rise further in the near term, especially through a jump in the prices of oil-related items.

Acknowledging that the crisis has added "considerable volatility and stress on what is an already challenging business environment", Gan assured that the government has in place various measures to help businesses manage the various cost drivers.

"Households have also been affected by the rise in inflation, especially from higher utilities and grocery bills," said Gan, adding that the government will monitor the inflation situation carefully and will provide additional help if there is a need to.

More details on how the government plans to help businesses and workers overcome the ongoing challenges and capture opportunities will be given by the Ministry of Trade and Industry's Committee of Supply.

The manpower challenges faced by businesses were raised by several MPs during the debate.

East Coast Group Representation Constituency (GRC) MP Jessica Tan asked if the government would consider providing targeted support for businesses that are currently struggling to meet their manpower needs.

"The impact of the pandemic on manpower and the level of Omicron infections has made the situation more pressing," said Tan. "This is affecting their ability to operate effectively."

Foo Mee Har, MP for West Coast GRC, said some businesses have given feedback that the planned raised minimum salaries for Employment Pass and S-Pass holders have "forced" them to increase the salaries of their foreign employees due to the tight labour market.

"The use of salary thresholds is a blunt instrument that does not take into account specific skills requirements and gaps in the market," she added.

On low-wage workers, Tan, as well as Workers' Party chief Pritam Singh, asked if the government would reconsider its move to introduce a minimum income criterion of S$500 per month for the Workfare Income Supplement (WIS).

Finance Minister Lawrence Wong had said that the minimum income criterion was introduced to encourage part-timers and casual workers to take up regular, full-time work.

However, Tan and Singh noted that there are legitimate reasons for why some older low-waged workers would opt for part-time work.

Some of them, for instance, need the flexibility as they are caregivers.

Others, who work in physically demanding jobs such as in the food and beverage sector, may find full-time work gruelling as they are not able to stand on their feet for 8 hours due to their old age, said Singh.

"For others, retraining is easier said than done. Yet others simply cannot find full-time work in the limited areas they are qualified for and take what part-time and casual work they can find," he added.

Separately, MP for Kebun Baru Single Member Constituency Henry Kwek spoke about the need to help workers employed in Covid-related management jobs transition to other employment as Singapore gradually transitions to live with the coronavirus.

"It is time for us to start considering how to best encourage Singaporeans involved in Covid management to go back to their industry," said Kwek, adding that doing so could help mitigate the manpower constraints that many businesses are facing and therefore help alleviate rising costs.

With many uncertainties and challenges lying ahead for Singapore's recovery, Foo asked how the government plans to respond if it is not able to achieve a balanced Budget for this term.

"Whilst I agree with the expansionary policy to ensure that recovery will be sustained, it is equally important that we do not lose sight of the fiscal prudence that has defined Singapore's approach to budgeting," she said.