$6.4 billion for Covid-19 outbreak as DPM unveils strong Budget
Measures part of 'more expansionary' $106 billion Budget to transform economy and fight climate change
In one of the most expansionary Budgets in years, the Government is pumping in $6.4 billion to cushion Singaporeans from the economic impact of the coronavirus outbreak.
A $4 billion Stabilisation and Support Package will keep workers in jobs, assist businesses with cash flow, and give additional support to sectors most affected by the fallout.
Households will get help with cost of living in a $1.6 billion Care and Support Package, including a one-off cash payout of $100 to $300 for every Singaporean aged 21 and above, with more going to the less well-off.
Another $800 million will be set aside to support front-line agencies fighting the outbreak, with the bulk of this going to the Health Ministry.
This dwarfs the $230 million relief package during the severe acute respiratory syndrome (Sars) crisis in 2003.
In his Budget speech yesterday, Deputy Prime Minister Heng Swee Keat said the immediate concern is to protect Singaporeans and their families.
"We will put in every effort to slow down the spread of the virus... I am confident that together we will stay strong and get through these trying times," added Mr Heng, who is also Finance Minister.
The anti-virus measures are part of a $106 billion "more expansionary" Budget that also aims to prepare Singapore for the future. As a result, it is expected to incur a $10.9 billion deficit - more than six times the estimated deficit for last year and the largest projected since the 2009 global financial crisis.
But unlike in 2009, there is no need to draw on past reserves as the Government has sufficient surplus to fund the projected deficit, Mr Heng said.
With the Ministry of Trade and Industry slashing the growth forecast for this year to between -0.5 and 1.5 per cent, he said: "We must be prepared that the economic impact may be worse than we projected."
Leaving no doubt that the Covid-19 outbreak, with 81 confirmed cases here as of yesterday, will hit Singapore's economy, Mr Heng said jobs were the foremost concern in the aid package for the business sector.
To defray wage costs, a new Jobs Support Scheme will see the Government offset 8 per cent of wages for every local worker here for three months, capped at $3,600 a month.
Employers will receive this money by end-July. With over 1.9 million local workers here, this will cost $1.3 billion.
The Wage Credit Scheme, which co-funds wage increases for Singaporeans earning a gross monthly wage of up to $4,000, will be enhanced.
The monthly wage ceiling for qualifying wage increases for 2019 and 2020 will be raised to $5,000, with the Government increasing its co-funding by five percentage points.
About $1.1 billion will go to some 90,000 businesses, benefiting more than 700,000 local workers.
The five sectors directly affected by the outbreak - point-to point-transport, tourism, aviation, retail and food services - will get additional help.
The Transport Ministry has announced a $77 million package for taxi and private-hire car drivers who have seen business fall by a third. For the other four sectors, the Government will extend the funding period for reskilling from three to six months to help employers retain and train more than 330,000 local workers.
Mr Heng said: "We want to help our workers retain their jobs and use any lull period to upgrade their skills, to be ready when the tide turns."
Hotels, serviced apartments and meetings, incentives, conventions and exhibitions (Mice) venues will get a 30 per cent property tax rebate.
Changi Airport, international cruise and regional ferry terminals and commercial properties will get a 15 per cent rebate, while the two Integrated Resorts will get 10 per cent.
Mr Heng strongly urged landlords to pass the rebates on to tenants by reducing rentals.
A temporary bridging loan programme of up to $1 million will be set up for companies in the tourism sector.
There will also be rebates on aircraft landing and parking charges, assistance to ground handling agents, and rental rebates for shops and cargo agents at Changi Airport.
More broadly, a 25 per cent corporate tax rebate, capped at $15,000, will be given to all companies for the Year of Assessment 2020. Enhancements to the corporate tax system will allow faster write-downs of investments in plant and machinery, as well as renovation and refurbishment.
The cap for a working capital loan for small and medium-sized enterprises will be doubled to $600,000 and the Government will co-fund up to 80 per cent of the loan default risk.
Beyond the measures to tackle the outbreak, which Mr Heng called a "sudden storm", the Budget will help to drive longer-term economic transformation and growth. For this, $8.3 billion has been allocated over the next three years. To mitigate climate change, $5 billion has been allocated.
"Budget 2020 is our strategic financial plan to prepare Singapore and Singaporeans to meet these challenges and seize new opportunities," Mr Heng said.
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