Singapore

$370 million in wage support wrongly paid out to 5,400 companies

Error occurred after Government used wrong dates to determine amount to be disbursed

An excess of $370 million in wage support was erroneously paid out last year, after the Government used the wrong dates to determine the amount to be disbursed to some 5,400 companies.

The same error also resulted in an excess of $1.2 million being paid out in foreign worker levy waivers and rebates to 360 companies.

Announcing the erroneous Jobs Support Scheme (JSS) and levy waiver and rebate payments yesterday, the Ministries of Trade and Industry (MTI), Finance, and Manpower said the mistake was discovered in November last year when the Inland Revenue Authority of Singapore (Iras) found anomalies in its regular processing checks on the JSS.

At the same time, Iras also had calls from several businesses that received extra JSS payouts.

This sparked an investigation, which eventually traced the overpayments to an error in the compilation and processing of the reopening dates used to calculate how much JSS payouts a company should get.

The JSS, first introduced in February last year, provides subsidies for wage costs based on the sector a company is in.

The mistakes occurred in applications submitted by companies in the construction, marine and process sectors. These companies had to seek permission to restart projects, and would include their subcontractors, clients and other partners in their applications.

DATES

Because of errors in compiling the information, the dates for when projects would restart were taken as the reopening dates for all the companies named in the applications.

As a result, some companies were deemed to have been closed longer than they actually were and received higher wage subsidies.

The ministries said in a statement: "As the processes for the resumption of business activities had to be implemented at short notice, MTI used existing systems and manual processes to grant approvals for businesses to reopen.

"Unfortunately, in so doing, mistakes were made with the reopening dates and concomitantly the JSS payouts and foreign worker levy waivers and rebates payable."

Among the companies affected, fewer than 100 larger companies account for $200 million of the overpayment, said the ministries.

For more than two-thirds of the companies, the excess payout would have been smaller than $10,000, they added.

The ministries also said that they expect to recover all the overpaid monies within the year.

Meanwhile, the foreign worker levy waiver will be automatically offset from the future levy bill of businesses.

The mistake had also resulted in some companies being underpaid for JSS and foreign worker levy waivers, the ministries said.

An external auditor has also been hired to conduct a thorough check on the reopening dates used in the computation of JSS payouts, they added.Companies can log in to go.gov.sg/reopeningdate using their CorpPass to check if they are affected from Saturday.

This article first appeared in The Straits Times.

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Employment