More funding for training, digitalisation among Asme’s Budget 2025 proposals
The government could also help companies’ training efforts, the association suggests
BUDGET 2025 could help Singapore’s small and medium-sized enterprises (SMEs) with more funding for training, streamlined digitalisation grants, and greater flexibility in heading overseas, suggested the Association of Small and Medium Enterprises (Asme).
On Feb 18, Finance Minister Lawrence Wong will deliver his first Budget speech since becoming prime minister in May 2024. Ahead of this, Asme submitted 21 recommendations to the government in November, across five areas.
One area was human capital, with suggestions to help companies support older workers – by funding health checkups, for example – and parents.
The government could also help companies’ training efforts. In Budget 2024, the usage deadline for the one-off SkillsFuture Enterprise Credit (SFEC) was extended by a year till Jun 30, 2025 – but firms that had used the S$10,000 grant could not tap it again, Asme president Ang Yuit noted.
Asme thus proposed that Budget 2025 provide an annual SFEC top-up of S$500 per employee, capped at S$5,000 per company, to ensure continual support for training.
The grant covers up to 90 per cent of out-of-pocket expenses on qualifying costs for supportable initiatives.
“If you want (companies) to retrain their workers, you have to allow and empower the firms to do that,” Ang told The Business Times.
Separately, with minimum qualifying salaries rising for Employment Pass (EP) holders, smaller SMEs could be given a one-time exception to help them cope with business costs, suggested Asme.
Minimum qualifying salaries rose at the start of this year for new EP applicants and will rise on Jan 1, 2026, for renewals.
Asme suggested a “lower salary exception” for SMEs with fewer than 25 employees, letting them renew EPs at S$1,000 to S$2,000 below the new minimum qualifying salaries. This could be offered as a one-time exception per EP holder.
Venturing abroad
Another set of suggestions was on internationalisation, which remains a key challenge for smaller SMEs, particularly those with annual revenues below S$5 million, said Ang.
Here, the government could work with trade associations and chambers to “explore co-creating additional goals” for companies when they go abroad.
Currently, when firms go overseas with government funding – to attend trade shows, for example – they must meet specific goals within a “very strict” framework, said Ang.
Such frameworks could be made more flexible with less stringent criteria, so that more companies can participate, he added.
Going green and digital
The remaining three categories were sustainability, digitalisation and grants, schemes and incentives.
For sustainability, ideas included green vouchers that consumers can use for a wider range of products – not just appliances – as well as green marketing grants.
For digitalisation, Asme noted that much software is subscription-based. Funding this through the existing Productivity Solutions Grant may be difficult, as the grant has a pre-approval and claims process that can be cumbersome for SMEs, said Ang.
Asme proposed that the government could instead provide a base credit of S$1,000 per year for three years that SMEs can use to subscribe to such software.
SMEs should be allowed to choose software beyond those pre-selected by government agencies, so that digitalisation can be tailored to their needs, said Ang.
The last set of recommendations were for grants, incentives and schemes. These include simplifying grant processes, increasing support for areas such as mental wellness programmes, and improving existing schemes.
For instance, Asme proposed a “lite” version of the Enterprise Development Grant that offers smaller grant amounts with simpler application and audit requirements, making it more accessible to smaller firms.
This was among several items repeated from Asme’s Budget 2024 wish list. Another repeat proposal was for government-linked companies to involve more local SMEs in overseas projects through competitive tenders, possibly supported by tax incentives or grants.
