Singapore

Challenges for every income level

Parliament sat for the second day yesterday, where MPs debated the Budget presented by Finance Minister Heng Swee Keat almost two weeks ago. 

Several MPs called for the Government to address the concerns of different income groups. Here are the points raised:

1 HIGH INCOME

Tax cap burdens working mothers

The introduction of a cap of $80,000 on personal income tax reliefs was highlighted by Nee Soon MPs Lee Bee Wah and Mr Louis Ng.

This change will mostly affect working mothers with higher incomes because they receive the Working Mother's Child Relief.

MacPherson MP Tin Pei Ling, who asked for the rationale behind the tax cap, said it made working mothers feel singled out, and they also wondered if they were being penalised for having a career and children at the same time.

Ms Lee said a mother of three told her that the tax cap will increase her tax burden by 20 per cent and she was reconsidering having a fourth child.

She said: "I know this cap is expected to net $100 million a year in revenue, but I certainly hope it will not turn out to be 'penny wise pound foolish' by driving high-income mothers away from the workforce, or reducing the number of children they add to our future workforce."

Tanjong Pagar MP Joan Pereira appealed for the cap to be lifted for those who are widowed or divorced as they usually face more challenges, such as raising families on their own.

She added: "Many of these women hold senior positions in their demanding careers and have to juggle pressing family needs as well."

2 MIDDLE INCOME

Household type not reflective

Chua Chu Kang MP Zaqy Mohamad and Mountbatten MP Lim Biow Chuan suggested that housing type should not be used as a criteria to determine qualification for government schemes.

For instance, it was announced in the Budget speech that seniors who own five-room flats would not qualify for the Silver Support Scheme.

Mr Zaqy said: "Many of my older residents have asked the Government to move away from using household types as a cut-off because it is no longer reflective of income and wealth.

"For example, today, a five-room flat in Choa Chu Kang sells for about $450,000 to $488,000, compared to a three-room flat selling at $550,000 in Upper Cross Street or a four-room flat selling at $900,000 at the Pinnacle."

Nominated MP and unionist K. Thanaletchimi questioned why middle-income earners - also known as the sandwiched class - did not receive any tax rebates this year.

Ms Thanaletchimi called for more to be done to assist middle-income workers who have lost their jobs, as the job search can take more than six months to a year.

Ang Mo Kio MP Gan Thiam Poh is also concerned about the re-employability of these middle-aged or older PMETs, calling them an "easy choice of the company's cost-cutting restructuring measures".

He urged the Government to incentivise employers to keep the jobs for these experienced PMETs and to allocate more funds to the Career Support Programme (CSP), which has a wage-support component and makes it attractive for employers to hire such individuals in any job that pays a gross salary of at least $4,000 a month.

3 LOW INCOME

Mandatory AWS in some industries

To help low-wage workers, Pasir Ris-Punggol MP and NTUC assistant secretary-general Zainal Sapari called for annual wage supplements and increments to be mandatory in the cleaning, security and landscape industries.

Jurong MP Tan Wu Meng called for our socio-economic system to remain progressive and to support social mobility by giving every child a fair start in life. He added: "When a child from a disadvantaged background does well, it helps uplift the rest of the family."

Jurong MP Rahayu Mahzam thinks that more can be done for students from these families to enhance social mobility. She suggested the need for these students to build social capital, which is the access to resources and networks, to move up the social ladder.

For instance, there can be coordinated interactions, such as sharing sessions and peer mentoring programmes among students from diverse backgrounds in secondary schools, polytechnics and ITEs.

MP: Foreign workers are like 'drugs' to SMEs

Ultimately, the whole country will run out of fish if (SMEs) don't develop bigger, smarter and faster fishing ships to get better fishes from international waters. - MP for Nee Soon GRC Lee Bee Wah

Everyone wants help from the Government, but firms and Singaporeans should not become over-reliant on these initiatives, said MP for Nee Soon GRC Lee Bee Wah during the debate of Budget 2016 in Parliament yesterday.

Ms Lee said she supported the Government's initiatives in the Budget to help Small and Medium Enterprises (SMEs) stay afloat, but cautioned against fostering an over-reliant attitude of firms on the Government.

Foreign workers are like "drugs" that Singapore business owners might be too dependent on and this might create a passive attitude among SMEs, she added.

Ms Lee said: "I have also seen many business owners who have not made any progress in reducing their reliance on foreign workers.

"Instead of re-looking their work processes, they ask their MPs to appeal to delay the time they have to send their foreign workers back."

THINK LONG TERM

She said that while firms "rightly" expect some "fish" from the Government to keep their workers fed, they need to embrace longer-term plans and the spirit of entrepreneurship to innovate and raise their productivity levels on their own even during economic downturns.

"Ultimately, the whole country will run out of fish if (SMEs) don't develop bigger, smarter and faster fishing ships to get better fishes from international waters," she said.

"That is why I fully support the idea of automation and internationalisation."

Singaporeans with elderly parents should also take up the primary responsibility of caring for their parents and not delegate or expect the Government to take full responsibility through various social initiatives, said Ms Lee.

Ms Cheryl Chan, MP for Fengshan SMC, also warned against Singaporeans depending too heavily on the Government for social programmes as this might increase the burden on future generations.

She said: "Being aware of what the potential outcome may be, it is prudent for us to take the necessary steps today to avert such an outcome... (We should) strike a right balance between state support and partnerships with the community at large."

OTHER ISSUES RAISED YESTERDAY

ADDITIONAL 
MATERNITY LEAVE

Holland-Bukit Timah MP Christopher de Souza proposed that working mothers be given the option to choose between taking an additional eight weeks of flexi-work or an additional eight weeks of no-pay leave.

He said: "This will give mothers more time to bond with their newborns and would also make it easier for them to breastfeed exclusively for six months, if they so wish."

He added that employers will not be financially disadvantaged as they would not have to pay them during the eight-week period of unpaid leave, and it makes it easier for them to forecast manpower needs.

DELAYING INCREASE IN FOREIGN WORKER LEVY

Ang Mo Kio MP Gan Thiam Poh asked for a deferment for the increase in foreign worker levies for S Pass holders in every sector and work permit holders in the construction and services sectors.

He acknowledged the danger of over-reliance on foreign workers, but said that the impact on business costs is substantial at a time when companies are facing more difficult conditions.

He added: "Higher levies just add onto the business cost burden without necessarily resulting in the desired productivity gains."

REFINING BUDGET CONSULTATION PROCESS

MP for Nee Soon GRC Louis Ng suggested tweaking the Budget consultation process

He suggested that a month-long public consultation process take place in November before a draft Budget Statement is released in February for the coming financial year.

After which, there should be another month-long round of public consultations so Parliament can gather feedback from the ground and work towards incorporating it into the final Budget Statement, Mr Ng added.

He said: "Is this process more tedious? The answer without a doubt is yes.

"But will people feel more engaged, more empowered and will this strengthen our partnership with fellow Singaporeans? The answer is without a doubt also yes."

parliamentSingapore Budgetheng swee keatFinanceNee Soon GRCUncategorisedFENGSHAN