Sunday 18 February 2024

Singapore Budget 2024: Building Our Shared Future Together



A Budget for all as Singapore tackles immediate cost-of-living challenges, invests in longer-term goals
By Goh Yan Han, Political Correspondent, The Straits Times, 17 Feb 2024

Everyone will have a slice of the Budget 2024 pie, which aims to address immediate challenges like cost-of-living pressures while investing in longer-term goals of strong economic growth, better jobs and a culture of lifelong learning.

Key policy moves include enhancements to the Assurance Package like giving out more Community Development Council (CDC) vouchers.

A significant top-up of SkillsFuture credits will benefit mid-career workers, while a corporate income tax rebate aims to help companies manage rising costs.

The Government will also be rolling out strategies to improve retirement adequacy, lower healthcare costs and provide more for lower-wage workers.

Many of these moves were signposted earlier in the Forward Singapore report released in October 2023.

Budget 2024 rolls out the first instalment of the Forward Singapore programmes, Deputy Prime Minister Lawrence Wong said in Parliament on Feb 16 as he delivered his third annual Budget speech.

He laid out a $131.4 billion proposal – about 18.3 per cent of Singapore’s gross domestic product.


These moves are part of an “ambitious agenda” to achieve the shared goals of building a nation that is vibrant and inclusive, fair and thriving, as well as resilient and united, he said.

They come amid a mixed outlook for 2024, he said. Growth in major economies is expected to be resilient, but geopolitical risks continue to loom large.

At the same time, global inflationary pressures are tipped to further recede, said DPM Wong, who is also Finance Minister.

He was “cautiously optimistic” that 2024 will be better than 2023, as he projected a $0.8 billion surplus for the upcoming financial year – “essentially a balanced fiscal position”.


Tackling cost-of-living pressures

DPM Wong acknowledged the pressure of higher living costs faced by many households.

While the economic situation is expected to improve in 2024, there are still uncertainties, which is why he has further enhanced the Assurance Package, said DPM Wong.

The package, meant to offset the impact of the goods and services tax hike, will be boosted by another $1.9 billion.

This includes an additional $600 in CDC vouchers for all Singaporean households, with the first tranche of $300 to be disbursed in end-June, and the remainder in January 2025.

All adult Singaporeans with an assessable income of up to $100,000 and who do not own more than one property will also receive a Cost-of-Living Special Payment of between $200 and $400 in cash.

Other measures to help individuals with costs include a MediSave top-up of up to $300 for about 1.4 million adult Singaporeans aged 21 to 50.


To help parents, fee caps – the maximum amount that school operators can charge – will be reduced for government-supported pre-schools. There will also be fee reductions for special education schools.


In addition, there will be a personal income tax rebate of 50 per cent, capped at $200, for the 2024 year of assessment.

Businesses will also receive help to manage rising costs, such as a 50 per cent corporate income tax rebate, capped at $40,000.


Supporting workers and businesses

A key component of the Budget is a suite of measures targeted at mid-career workers.

All Singaporeans aged 40 and above will receive a $4,000 top-up in SkillsFuture Credit as part of a new SkillsFuture Level-Up programme.


This will benefit about 1.95 million Singaporeans currently, though those younger will receive the top-up as well when they turn 40.

While the existing basic tier of $500 SkillsFuture Credit covers a wide range of courses, the new credit will only be allowed for use for selected training programmes with better employability outcomes. More details will be announced later.


Under the new programme, there will be subsidies for all Singaporeans aged 40 and above to pursue another full-time diploma at polytechnics, institutes of technical education and arts institutions from the 2025 academic year onwards. Currently, only those studying for their first diploma benefit from government subsidy.

DPM Wong also unveiled a monthly training allowance for Singaporeans aged 40 and above who enrol in selected full-time courses.

These moves are meant to help Singaporeans develop to their fullest potential, and to have productive and meaningful careers, he said.

A key priority of the Government is to ensure a strong, innovative and vibrant economy – and it will do so by focusing on productivity and innovation, he added.


DPM Wong announced a new Refundable Investment Credit, a tax credit meant to help Singapore stay competitive and attract investments from global companies.

There will also be investments to upgrade the Nationwide Broadband Network to enable mass market access to broadband speeds of up to 10 gigabits per second in the second half of this decade. This would be 10 times faster than the broadband speed in most homes today.

DPM Wong also brought up the temporary financial support scheme for the involuntarily employed, which had been mentioned in the Forward SG report.


He said that the Government is working out the parameters for the scheme, and will provide more details later in the year.

“Ours must always be an economy that provides opportunities for all; an economy that benefits the many rather than the few,” he said.

In this vein, DPM Wong announced enhancements to schemes that uplift lower-wage workers, such as the Workfare Income Supplement scheme and Workfare payouts.

The Government will also provide more support for employers who raise the wages of lower-wage workers by increasing its co-funding levels of the Progressive Wage Credit Scheme – from a maximum of 30 per cent to 50 per cent.


To encourage and support more young ITE graduates in upskilling efforts, a new ITE Progression Award will be rolled out for those aged 30 and below.

This will include a $5,000 top-up to their Post-Secondary Education Accounts when they enrol in a diploma programme, as well as a further $10,000 top-up to their Central Provident Fund (CPF) Ordinary Account when they attain their diplomas.


Help for seniors

Another area that the Budget provides for is support for the retirement needs of senior citizens.

DPM Wong said there will be adjustments to the CPF system, such as an increase in CPF contribution rates for those aged 55 to 65 by 1.5 percentage points in 2025.

Employers will be able to benefit from the CPF Transit Offset for another year, to cover half of the increase in their contributions for 2025. This will help cushion the impact on business costs.

The Enhanced Retirement Sum – the maximum amount one can put in the CPF retirement account to receive CPF payouts – will also be raised from 2025, to become four times the Basic Retirement Sum (BRS). It is currently three times the BRS.

The CPF system will also be tweaked, as the Special Account will be closed for those aged 55 and above, starting in 2025. The savings in the Special Account will be transferred to the Retirement Account, up to the Full Retirement Sum. The rest will be transferred to the Ordinary Account.


In addition, there will be enhancements to retirement support schemes for seniors who need more help. These include the Silver Support Scheme and Matched Retirement Savings Scheme.


DPM Wong also provided more details on the Majulah Package, announced by Prime Minister Lee Hsien Loong at the National Day Rally in 2023. The scheme will benefit about 1.6 million Singaporeans.

The package includes an Earn and Save Bonus for seniors earning up to $6,000 a month to accumulate more retirement savings and a one-time Retirement Savings Bonus of between $1,000 and $1,500 for seniors with retirement savings below the BRS.


Rounding up his speech, DPM Wong said the Forward Singapore policy moves will cost around $5 billion in the 2024 financial year, and will in total reach close to $40 billion by the end of the decade.

Projections by the Finance Ministry in 2023 assessed that government spending would increase to around 20 per cent of GDP by 2030.

DPM Wong said that for now, that remains the Government’s assessment.

Assuming the Government stays within this range of spending increase, it should have sufficient revenues to maintain a balanced budget over the coming years, he added.

But the medium-term fiscal position is tight, as there are many pressures to spend more.

“We will have to manage these expenditures carefully, or we will end up with a significant funding gap,” he said.


This is already happening in many other advanced economies, where public finances are on an unsustainable path and fiscal systems are at risk of breaking, he added.

“We must never allow this to happen in Singapore. Instead, let us uphold the ethos of fiscal discipline and responsibility that has served us well, and ensure that our fiscal position always remains balanced, sound and sustainable.”

He reiterated that Singapore has been able to weather past storms and emerge stronger.

“I believe we can do so again in our road ahead, so long as we stay united, work together and continue to keep faith in each other.”


Parliament will debate the Budget and the spending plans of various ministries from Feb 26 to March 7.

Wednesday 14 February 2024

PM Lee Hsien Loong addresses Singapore's public finances and reserves in Parliament on 7 February 2024

Singaporeans are both beneficiaries and stewards of the reserves: Prime Minister Lee Hsien Loong at the Debate on the Motion on Public Finances
By Tham Yuen-C, Senior Political Correspondent, The Straits Times, 8 Feb 2024

Sacrifice and careful husbandry by earlier generations was how the Republic built up its nest egg of past reserves, and the current generation should see themselves as not just beneficiaries but also trustees who protect this inheritance for future Singaporeans, said Prime Minister Lee Hsien Loong.

The past savings were built up at a unique time in Singapore’s history when it could set aside budget surpluses, and if they are gone, it will not be possible to build them up again, he stressed.

This is why it is important to have the “right instincts”: to save where possible, to resist pressures to use the reserves, and to unlock them only when really necessary, he said.


“We must not erode the patrimony, this family treasure, which we have inherited from our forefathers, nor should we burden future generations with debt nor mortgage their future,” he added.

This compact of protecting the reserves has been forged across generations of Singaporeans, and had also been upheld across both sides of the House, he said.


He reiterated the Government’s long-held stance on the reserves in response to a call by Progress Singapore Party (PSP) Non-Constituency MPs Leong Mun Wai and Hazel Poa for the Government to review its current budget and reserves accumulation policies.

The two NCMPs had proposed that more of the reserves be used to “help present-day Singaporeans reduce their financial burdens and improve their quality of life”.

They were joined in this by Leader of the Opposition Pritam Singh and Workers’ Party (WP) MPs, who repeated their party’s position that using more investment returns would not jeopardise growth of the reserves.

Mr Leong said that in the face of the goods and services tax (GST) hike and rising cost of living, accumulating reserves at the current rate “hurts the welfare of present-day Singaporeans”.

PSP’s view is that current reserves are enough, especially if the Government is raising taxes “for the sake of maintaining the current rate of reserves accumulation”.


How much is enough?

But it is a misconception that a specific number can be deemed enough when it comes to the reserves, said PM Lee.

He recounted how Singapore first tapped $4 billion of the reserves in 2008 when the global financial crisis hit, to help employers pay Central Provident Fund contributions and protect jobs.

When the Covid-19 pandemic hit, some $40 billion was drawn from the reserves to fund assurance packages and pay for vaccines to save lives and livelihoods.

That is far from the worst thing that can befall Singapore, PM Lee added. He noted that the war in Ukraine costs the Eastern European country more than US$100 million (S$134 million) a day.

These examples are why there is no sensible answer to the question of how big a nest egg is enough.


“Looking ahead 50 years, can anyone promise that Singapore will enjoy another half century of peace and tranquillity? Or guarantee that someone will come to our rescue if we ever find ourselves in the same situation as Ukraine?” he said.

“We can never say for sure how much is enough, because we do not know what kind of crises we will face in the future, or how our investments will fare.”

But that does not mean Singapore should mindlessly save for a rainy day without regard for present needs, said PM Lee.

That is why the Government had enshrined in the Constitution the “50-50” rule, which allows up to half of returns from investing the reserves to be used for current spending.

This also happens to be about the right ratio to keep the reserves in proportion with the gross domestic product, PM Lee added.

With long-term expected real returns of the reserves currently at about 4 per cent, the Government can spend about 2 per cent and save the other 2 per cent. Singapore’s economy is expected to grow at about 2 per cent a year if things go well.

Keeping this balance means the Government can count on the reserves to provide one-fifth of its annual revenue – or around 3.5 per cent of GDP – without having to double the GST, said PM Lee.


Reserves spent on current generations

Among the points Mr Leong made was that too much money from the reserves was locked up in trust and endowment funds to pay for longer-term spending, at the expense of current generations.

Ms Poa, meanwhile, suggested that it was excessive to plough the proceeds of land sales back into the reserves, since land is sold on leases and is thus more akin to a renewable resource.

The Government’s policies therefore prioritised future generations at the expense of current Singaporeans.


Rebutting these arguments, Minister in the Prime Minister’s Office Indranee Rajah said that money in these funds was “not just for the far unknown future”, but was set aside to meet specific funding commitments for the benefit of today’s Singaporeans.

These include the over $2 billion disbursed each year from the GST Voucher Fund to help lower- and middle-income households defray their GST expenses, and money in the Pioneer Generation Fund and Merdeka Generation Fund that is drawn down regularly to support Singaporeans in those cohorts.

As for funds set up to pay for large infrastructure projects, these help to smoothen the lumpy spending on such projects and ensure that future generations will not have to scramble to find money to pay for them, Ms Indranee said.

“This is prudent, thoughtful and responsible fiscal policy – not evidence of excess fiscal resources,” she added.


As for treating land sales as revenue, Ms Indranee said selling land did not generate wealth. Instead, it merely converted a physical asset into a financial asset.

The cash proceeds accrue to the reserves and are then invested to generate returns, which contribute to government spending. In this way, the proceeds of land sales are used indirectly in each year’s budget, she said.

Past savings are also a strategic asset during crises and emergencies. Thus, it would be imprudent to disclose the size of the reserves, she said in response to calls for greater transparency from PSP and WP MPs.


Take it to the ballot box

PM Lee noted that the growing political pressure to use more of the reserves was not new, and that it would always be tough to raise taxes.

Early in Singapore’s history, founding prime minister Lee Kuan Yew and his team had anticipated this, and that is why they had formulated a two-key system that required the president’s approval to unlock the country’s savings, he said.

When Singapore instituted the 50 per cent spending rule in 2001, the former prime minister intervened in the debate to remind the House that at the end of the day, the Government’s deepest obligation is to the future.

“Not just to the present; certainly not to the past,” said PM Lee.

He said that is why in taking care of today’s citizens, the People’s Action Party (PAP) Government is conscious to also safeguard the interests of young people not yet of voting age, future citizens not yet born, and the long-term interests of Singapore.


This ethos was in fact shared across the aisle in the past, he added, noting that former WP leader Low Thia Khiang had commended the Government for being prudent when it returned $4 billion to past reserves in 2009.

“Now I hear the opposition arguing that we should change the rules and draw more from reserves, and that of course they have no intention to raid the reserves, far from wanting to bankrupt Singapore,” said PM Lee.

“They say we can easily afford what they are proposing, I conclude their tune has changed.”

Mr Singh’s rejoinder was that different times call for different measures, which was why the PAP Government has said it is unlikely to return to the reserves the $40 billion it took out to deal with Covid-19.

Mr Singh, who is WP chief, also said the Prime Minister was cherry-picking what Mr Low had said.

PM Lee said the PAP is convinced that it has the right approach to stewarding the reserves.

Opposition parties who want to spend more should therefore put the issue upfront and campaign on it at the next general election, he said.

“Say you want to touch, you want to spend, you want to shift the rules,” he said. “Don’t pretend that you’re just as prudent, only more kind-hearted.”


The PAP will join the issue and convince Singaporeans that its way – taking a long-term view of the reserves, and striking the right balance between present and future needs – is the right one for Singapore, said PM Lee.

“We are confident that we will win the argument, and we’ll be able to get Singaporeans to do the right thing.”

PM Lee said he had spent 40 years of his life stewarding and safeguarding the reserves, and was now preparing to hand over to his successor a Singapore in good order, one that is more prosperous and more secure.

“I ask everyone to help them maintain the prudent policies that have served us well to keep Singapore on the right track, so that we can all continue to benefit from the nation’s success for many years to come,” he said.

Friday 15 December 2023

Cost of living means different things to different folks in Singapore

The Economist’s Worldwide Cost of Living index does not shed light on the bills that ordinary Singaporeans pay.
By Lin Suling, Opinion Editor, The Straits Times, 13 Dec 2023

As a sign of the lengths Singapore will go to in a bid to up its wow factor and entice more travellers here, consider the dramatic four-storey waterfall display unveiled at the recently refurbished Changi Airport Terminal 2 in November.

Just about everyone I know has already visited the attraction, now the centrepiece of the T2 departure hall, and told me the four-minute musical extravaganza is not to be missed.

Now, you may be forgiven for confusing this 14m by 17m digital display with the man-made, HSBC-sponsored rain vortex at Changi Airport’s Jewel, which was opened a mere four years ago. That spectacular sight remains the world’s tallest indoor waterfall.

If two waterfalls – one digital, one physical – sound like overkill, that is probably precisely the intent. Singapore is already home to the world’s largest air-conditioned glass greenhouse, Gardens by the Bay, and hosted the first Formula One night race globally.

We must keep filling this carousel of new shiny things so we can remain vibrant and attractive to visitors, investors and corporate leaders.

Singapore thus far seems to be doing this well. Why else would expats keep coming back to Singapore despite it being billed the most expensive city nine times in the last 11 years by The Economist?

News of Singapore – along with Zurich – topping the 2023 Worldwide Cost of Living index on Nov 30, nonetheless, raised many eyebrows.

Many Singaporeans have suggested that it confirms their longstanding concerns that making ends meet in Singapore is becoming an uphill climb for the man in the street.

Online, netizens cite anecdotal experiences corroborating this jump in prices, from the doubling of the cost of a bowl of fish soup at their local coffee shop to complaints about certificates of entitlement (COEs).

Another pointed to news of thwarted attempts to smuggle 120kg of beef and pork as an unequivocal sign that more Singaporeans are turning to the black market to fill their stomachs. Never mind that meat smuggling is possibly the most creative strategy to beat inflation nobody has ever heard of.

And most discussions eventually reached the same conclusion: that the Singapore Government has slipped, in letting in foreigners who push up prices while leaving Singaporeans behind.


The most expensive city in the world for whom?

What to make of all this? Some information about how the Worldwide Cost of Living is put together offers perspective.

The full index of how cost of living stacks up across 173 countries is available only with a US$1,195 (S$1,602) fee. Its website suggests this full report is useful for human resources, corporates, financial institutions, and legal and insurance firms, as “this purpose-built Internet tool quickly calculates cost-of-living allowances and (aids in) building compensation packages for expatriates and business travellers”.

A closer look at the items used in this benchmark of relative cost of living, which is meant to be a comprehensive dataset of over 400 individual price points across 200 goods and services, throws up things such as international school tuition fees, public golf course fees and three-course dinners.

These may just be a few outliers that stick out. Even so, not only are they hardly stuff the average Singaporean spends on, they are also more accurately the make-up of what the typical expat around the world splurges on.

Here in Singapore, I would also add to this list the doubling of Additional Buyer’s Stamp Duty for purchases of homes by foreigners, and higher personal income taxes for top earners beginning from the 2024 year of assessment.

Curiously, despite these higher projected expenses, the foreigners just keep coming.

Sunday 10 December 2023

Henry Kissinger, Lee Kuan Yew and a friendship that influenced the world

Both men were realists who spoke frankly, and global leaders listened to them. They also shared a close bond.
By Shashi Jayakumar, Published The Straits Times, 8 Dec 2023

There is a delicious anecdote about a meeting in November 1968 at Harvard University, at what later became the Kennedy School of Government. Some professors were railing against the war in Vietnam and then US President Lyndon Johnson.

Singapore’s then Prime Minister Lee Kuan Yew, in Harvard for a sabbatical of five weeks, on being invited to give a response, said tersely, “You make me sick”, before proceeding to give a clear and concise summary of why America had to stay the course and provide security against the communists bent on undermining South-east Asian nations.

Mr Lee remembered the incident in his memoirs as a respectful difference of views and omitted the pungent words.

But Dr Henry Kissinger, then a professor at the faculty encountering the Singaporean for the first time, related the entire incident in his own study of Mr Lee’s leadership, and in his last book before his death last week at the age of 100.

On arrival at Harvard, Mr Lee had said that he was there “to rest, to rethink, to reformulate policies, to get fresh ideas, to meet stimulating minds, to go back enriched with a fresh burst of enthusiasm for what I do”.

And what minds they were: political scientist Samuel Huntington, Graham Allison (the young postgraduate student at Harvard assigned to accompany Mr Lee to seminars, later a famous professor who co-authored a book on him), and the economists John Kenneth Galbraith and Paul Samuelson.

Some, like Ray Vernon of the Harvard Business School, and Michael Porter (whom Mr Lee met later) were to subsequently give advice to our leaders on Singapore’s development and economic policy.

Mr Lee maintained friendly contact or correspondence with some of these men for years.

From 1967 (his first trip to the United States as prime minister), impressed with the spirit, talent and innovatory zeal he found, the Singapore leader would make annual or biannual visits to the US to understand and engage US policymakers, and to seek out and engage with other bright minds in and out of government.

November 1968 marked the beginning of a seminal friendship between Mr Lee and Dr Kissinger.

Wednesday 29 November 2023

Long Island to be reclaimed off East Coast could add 800ha of land, create Singapore’s 18th reservoir

Singapore to start environmental and engineering studies into "Long Island" off East Coast from early 2024
By Ng Keng Gene and Shabana Begum, The Straits Times, 29 Nov 2023

Three tracts of land could be reclaimed off East Coast Park in the coming decades, creating about 800ha of land for new homes and other amenities, as well as a new reservoir.

Called the Long Island, these land tracts – collectively about twice the size of Marina Bay – are Singapore’s response to the threat of rising sea levels and inland flooding in the East Coast area.

Land in the area is largely lower than 5m above the mean sea level, the extent that sea levels are projected to rise to by the end of this century if extreme high tides coincide with storm surges.

On Nov 28, National Development Minister Desmond Lee announced that public agencies will carry out technical studies for the Long Island project over five years, starting from early 2024.

Over the next few years, members of the public will be consulted for their ideas and suggestions for the project, which will take several decades to plan, design and develop.

The current plan is for three elongated tracts of land to be reclaimed in the area, extending from Marina East to Tanah Merah. The easternmost land tract will start from Tanah Merah, while the westernmost tract will be an extension of Marina East. Between these two tracts, a third tract will be reclaimed.

A large tidal gate and pumping station will be built in between each new land mass. These will control the water level in a new reservoir bordered by East Coast Park and the new land masses, and, in the process, reduce flood risks in the East Coast area.

National water agency PUB said the reclamation project is likely to create Singapore’s 18th reservoir.

Like the gate at Marina Barrage, the two gates at the new reservoir in East Coast will open to release excess storm water into the sea during heavy rain when the tide is low. At high tide, the pumps will be used instead to release the storm water.


Mr Lee said the new reservoir can also be used for water activities such as canoeing and dragon-boating.

Besides offering flood protection and increasing Singapore’s freshwater supply, the project will help meet future development and recreation needs, said Mr Lee.

Waterfront homes are expected to be built on the reclaimed land, along with amenities and industrial facilities. About 20km of new coastal and reservoir parks could be added, tripling the length of waterfront parks in the East Coast area, he said.


Plans for reclamation off East Coast were first unveiled in 1991, as part of the Urban Redevelopment Authority’s (URA) Concept Plan. It was envisioned then that a series of reclaimed islands would provide waterfront housing and leisure opportunities.

At the 2019 National Day Rally, Prime Minister Lee Hsien Loong said reclaiming a series of islands offshore and linking them up with barrages could protect existing low-lying areas and create a freshwater reservoir.

URA showcased a possible concept for reclamation works at its long-term plan review exhibition in 2022.


In his speech on Nov 28, Mr Desmond Lee said the Government has been studying various coastal protection options, including building a sea wall up to 3m tall that would stretch from Marina East to Tanah Merah.

The wall would be accompanied by 12 sets of tidal gates and pumping stations – one set at each of the 12 existing outlet drains along East Coast. The gates would stop seawater from flowing inland during high tide, while the pumping stations would pump storm water from the drains into the sea when the gates were closed.

Mr Lee said this option is technically feasible but not ideal for East Coast Park, as large stretches of the park would have to be closed to the public when building the sea wall. When completed, it would permanently limit park users’ access to the waterfront for recreation and sports.


The 12 tidal gates and pumping stations would take up a lot of space within East Coast Park – about the area of 15 football fields – resulting in the loss of existing greenery and recreational facilities.

Mr Lee noted that the public hopes to retain unimpeded access to the waterfront, as well as preserve the heritage and recreation spaces along the coast.

A more optimal solution is to integrate coastal protection measures with reclamation plans for the area, he added.

Saturday 25 November 2023

Tripartism can work in Singapore because the PAP Government is pro-growth and pro-worker: PM Lee Hsien Loong

NTUC National Delegates’ Conference 2023 on 22 November 2023
By Jean Iau, The Straits Times, 22 Nov 2023

The pro-growth and pro-worker policies of the PAP Government are why tripartism can work in Singapore, Prime Minister Lee Hsien Loong said.

Such policies include creating good jobs while training workers to be able to do them, and making sure every Singaporean benefits from good housing and healthcare that are heavily subsidised by the state, he added.

As a result of its focus on these twin priorities of growing the economy and enabling workers to benefit fully from such growth, the Republic has created a “Singapore premium” where workers doing the same job here earn significantly more than their peers in the region.

Companies and investors are also prepared to pay more to be in Singapore to take advantage of its harmonious industrial relations and business-friendly environment, said PM Lee at the opening of the NTUC National Delegates’ Conference at Orchid Country Club on Nov 22.

“They value being in a country that knows where it is heading, where everyone pulls together for the common good, everything works, and life can get better for all.”

With the Government leading the country in the right direction, it is thus much easier for the tripartite partners to work together to create prosperity and share the fruits of growth, he added.


Tripartism is the three-way relationship between employers, unions and the Government that is focused on long-term interests and sustainable win-win outcomes.

Beyond good governance and sound national policies, the People’s Action Party (PAP) Government has also done its best to give Singaporeans good value for their tax dollars even as standards of living and aspirations go up, said PM Lee, who is the party’s secretary-general.

It has done so by running a lean and efficient public system, where government spending and taxes are kept low so that workers can enjoy the fruits of their own labour directly.

Essential public services such as public transport and water are also run efficiently and cost-effectively, requiring reasonable charges for their use without putting the whole burden on taxpayers.

This approach means charges have to go up from time to time as the cost of providing services rises, but the Government will give households that are most in need extra help, he said.


Speaking to some 1,500 union leaders, tripartite partners and other guests at the four-yearly event, PM Lee noted that founding prime minister Lee Kuan Yew had, at the watershed 1969 modernisation seminar, expressed his conviction that Singapore’s future depends on it having strong unions.

“I am convinced that in a vastly changed world – a world that is continuing to change rapidly, this is still true,” PM Lee said.

“The labour movement will play a vital role in Singapore for many years to come. And I know my successor Lawrence Wong thinks so too.”

Among the key outcomes of that seminar was the resolution for tripartite relations to be consensual instead of confrontational, and to develop a workers’ cooperative movement to provide essential goods and services while keeping prices low for members.


He noted that in the early days, PAP labour leaders such as the late Mr Devan Nair and Mr Ho See Beng formed the NTUC to rally the pro-PAP unions against the left-wing Barisan Sosialis, which organised multiple strikes and fomented mayhem to try and bring the Government down.

“I recall this history for a reason. As I told the PAP convention recently, the PAP was not born dominant and neither was the NTUC,” he said.

These baptisms of fire are why the symbiotic relationship between the PAP and NTUC is not merely an institutional arrangement, but rooted in history and forged in battle, he added.


PM Lee said that while many employers and governments elsewhere believe unions should play a smaller role in a rapidly changing world, the PAP rejects this view.

Its traditional roles of fighting for workers’ rights and ensuring good jobs will still be relevant, though the labour movement also has to reinvent and reimagine itself.

This includes guiding workers to keep up with a changing job market, working with the Government to provide all Singaporeans with a fair chance at success, and continuing to broaden its representation of different segments of the workforce, including gig workers and the migrant workforce, he said.

“We continue to strengthen our model of tripartism and keep it a lasting competitive advantage in an uncertain world,” he said.

“That way, we create a better future for our workers and for Singapore.”

Thursday 23 November 2023

ComLink+: New financial incentives to spur low-income families to work towards improving their lives

Low-income families with young children to get up to $30,000 in total payouts under ComLink scheme
By Theresa Tan, Senior Social Affairs Correspondent, The Straits Times, 20 Nov 2023

Low-income families will be given financial incentives and other support if they work towards improving their lives, in a national push to give them a leg-up.

Families with children living in highly subsidised Housing Board rental flats who qualify can get up to $30,000 in total payouts if they meet certain employment criteria and make voluntary Central Provident Fund (CPF) contributions to save up to buy their own homes.


About 14,000 families on the Community Link (ComLink) scheme are eligible for these new areas of support, which will be rolled out from the second half of 2024.

The measures are aimed at motivating families to send their children to pre-school by the age of three, find a stable job that pays CPF, and save up to buy their own homes. For example, beneficiaries can get between $450 and $550 every three months in a mix of cash and CPF payouts if they find a CPF-paying job with a salary of at least $1,400 a month.

One package helps families to clear their debt, such as for utility and housing arrears. This debt clearance package will match dollar for dollar up to $2,500 in sums repaid by the family, so the total debt cleared would be up to $5,000.

ComLink+ is a key plank of the national drive to reduce income inequality and boost social mobility under the Forward Singapore report, which was launched on Oct 27.

Speaking at the Year of Celebrating Social Service Partners appreciation event on Nov 20, Mr Masagos said: “We want Singapore to continue to be a place where social mobility is kept alive for all, especially low-income families who may face unique challenges.

“Many Singaporeans share this vision and agree that more support for low-income families is needed. At the same time, they think this needs to be done in a manner that does not erode self-reliance and agency.”


Mr Masagos described the ComLink+ scheme as a key shift beyond providing just basic, short-term social assistance. The additional financial support will help ease the financial pressures on the families and help them achieve their longer-term goals faster, he added.


“It may take a generation or more, but we know that by reinforcing families’ ability to provide their children with a good start in life today, we give them a better chance of a brighter tomorrow.”

The latest scheme builds on the existing ComLink programme that started in 2019, where low-income families with children living in HDB rental flats are given coordinated and comprehensive support ranging from job assistance to children’s development.

The ComLink+ support measures will be trialled for three years to assess their effectiveness before any potential scale-up, the Ministry of Social and Family Development (MSF) said.

Areas of support under four packages

1. Pre-school education

Each child enrolled in pre-school will get a one-time $500 top-up to the Child Development Account (CDA), which is a special savings account for the child that can be used to pay pre-school and healthcare fees, when they turn three.

Those between the ages of three and six will get a $200 top-up to their CDA every three months if they attend pre-school regularly. Regular attendance is defined as when the child is in pre-school at least 75 per cent of the time.

Local research has shown that children who attend pre-school from the age of three are less likely to require additional learning support in primary school.

However, the pre-school enrolment and attendance rate of children from lower-income families are lower than the national average, especially at the age of three and four. For example, 88 per cent of children aged three to four nationwide were enrolled in pre-school, compared with 78 per cent for those in lower-income families in 2021, the MSF told The Straits Times.

This package is funded by a corporate donor.

2. Stable employment

Beneficiaries will be given financial incentives if they find a job that pays CPF contributions with a gross salary of at least $1,400 a month. Each adult with a job that meets these criteria will get financial top-ups of between $450 and $550 in a combination of cash and CPF payouts for every quarter that he or she is employed.

If two adults in the same household qualify, they will each get an extra $50 every three months. A maximum of two adults per family can benefit from this employment package geared towards encouraging families to find a stable job.


3. Debt clearance

To help families clear their debt, this package will match dollar for dollar, up to $2,500, the amount the family repays for what the MSF calls verifiable debt. This refers to debt owed to licensed companies, such as utilities and housing arrears, that can be verified and for which repayments can be tracked. Debts to unlicensed moneylenders and sums owed to family and friends are not covered.

Families can benefit from this debt clearance package only once. To qualify, they must not be receiving financial aid from the Government’s ComCare scheme.

An MSF spokesman said: “With less disposable income and savings, lower-income families are more susceptible to falling into debt or arrears, especially if they encounter unexpected setbacks or have inherited debt.

“Even a relatively small debt can severely impact lower-income families financially, psychologically and emotionally, affecting their ability to resolve their debts and work towards long-term goals.”

This package is funded entirely by donors, including Singapore Pools.

4. Saving for home ownership

To help families save up to buy their own flats, for every dollar that the family voluntarily contributes to the CPF Ordinary Account, the Government will top up $2. A family can receive only up to $30,000 in total payouts across this package and the employment package. This package is funded by the Government and DBS Bank, an anchor partner for ComLink+.

Mr Masagos said over 170 partners, which includes DBS, OCBC, UOL’s Pan Pacific Hotels Group, are providing support to ComLink families in various ways.

The financial top-ups will be given for as long as the family remains eligible for the particular package or until the family reaches the payout limit specified for each package, whichever is earlier.

These four areas of support in the packages were designed based on the key needs and aspirations families on ComLink had shared, the MSF said.


Mr Masagos said ComLink officers will be trained to act as family coaches to motivate and support families in working towards their goals.

He said: “When families feel understood and supported, they are more likely to actively participate in the decision-making process and take steps towards their goals. With support from family coaches to meet their immediate needs and stabilise their situations, families tell us they feel more optimistic about their future.”