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Ministerial Statement October 2020: Singapore's Fight Against COVID-19
We have seen the number of Covid-19 cases coming under control in Singapore, however, the greatest impact has been on our economy and the Covid-19 aftermath continues to pose a threat. Over the past few months, there have been a total of five rounds of support measures for companies and workers being delivered in order to help Singaporeans weather through this difficult time.
Today, 5th October 2020, Deputy Prime Minister and Finance Minister Heng Swee Keat has delivered a Ministerial Statement to outline the progress of Singapore’s fight against Covid-19 and "strategies to emerge stronger" from this pandemic.
To prevent Singapore’s economy from contracting further, the Monetary Authority of Singapore (MAS) has estimated that the previous Budgets will help to lessen the contraction by a further 5.6% of Gross Domestic Product (GDP) in 2020 and 4.8% in 2021.
In addition, the Jobs Support Scheme (JSS) payouts since April 2020 have also helped to cushion the rising unemployment rate, with an estimated 155,000 jobs saved over these two years.
Singapore will also continue to support businesses and workers during this crisis, with close to S$100 billion pumped into our economy. As Singapore’s revenue collections are expected to fall and Government’s expenditure rising to provide support for Singaporeans and businesses, being prudent is the guiding principle for Singaporeans:
"Our guiding principle is prudence, not austerity. We will continue to invest decisively in our national priorities, with a deep commitment to leave behind a better future for our children," said DPM Heng.
DPM Heng also pointed out "how Singapore responds to Covid-19 today will shape the country's growth in the coming five to ten years."
Post Circuit Breaker Phase 3
More details on the roadmap to Phase 3 will be announced by the multi-ministry task force led by Ministers Gan Kim Yong and Lawrence Wong in the coming weeks.
There will be changes to the current regulations on the size of group gatherings allowed, and participation at mass events. The expected timeline for Phase 3 will also be announced.
On top of the current safe management measures in place, swift contact tracing and isolation of infected individuals are also crucial in our fight against spreading of the coronavirus. Singapore has also increased its testing capacity to target 40,000 laboratory tests a day.
Extension for Temporary Bridging Loan Programme (TBLP)
The Temporary Bridging Loan Programme was announced earlier this year as a key support for business financing to help Small and Medium Enterprises (SMEs) in all sectors to have access to working capital to tide through this crisis. SMEs can apply up to S$5 million business loans under the Temporary Bridging Loan Programme.
The Government has enhanced financing support for SMEs by increasing its risk-sharing to 90% for loans initiated from 8th April 2020 to 31st March 2021. This will be extended for another six months, until September 2021, at reduced levels in order to help local companies manage their immediate cash flow needs.
Extension of debt moratorium programme
As cash flow management continues to be a major problem for SMEs to stay afloat during this Covid-19 pandemic, the Government has provided measures to relieve some of the cash flow pressure by allowing SMEs to have more time to resume full loan repayment.
Under the Extended Support Scheme - Standardised (ESS-S), SMEs in Tier 1 and 2 Sectors can opt to defer up to 80% of principal payments on their secured loans granted by banks or finance companies, as well as loans granted under Enterprise Singapore’s Enhanced Working Capital Loan and Temporary Bridging Loan Programme from 2nd November 2020 till 30th June 2021.
Tier 1 and 2 sectors comprise of aviation and aerospace, tourism, hospitality, conventions and exhibitions, built environment, licensed food shops and food stalls (including hawker stalls), qualifying retail outlets, arts and entertainment, land transport, and marine and offshore.
SMEs that are not included in the Tier 1 and 2 sectors can opt for debt moratorium till 31st March 2021.
Read also: What SMEs and Individuals Should Know About The Extended Support Scheme - Standardised (ESS-S): An Extension To The Debt Moratorium Programme Beyond 31st Dec 2020
Read also: With MAS and Banks In Talks To Extend Debt Relief Scheme, Should You Opt In Or Not?
Enhancements to support schemes
For firms in hard-hit sectors, such as air transport, retail and tourism, as well as marine and offshore, the Enhanced Training Support Package will be extended for another six months, until 30th June 2021, to provide enhanced course fee subsidies.
The absentee payroll rates will also be reduced to 80% from January. The absentee payroll funding is a grant to help employers defray their manpower costs incurred when they send their employees for certifiable skills training.
Other measures include the Jobs Growth Incentive (JGI) scheme which will provide wage support of 25% - 50% on the first S$5,000 of gross monthly wages for local hires up to 12 months. The 50% tier will also be provided to firms who hire people with disabilities between September 2020 to February 2021.
In addition, to support businesses looking to internationalise, transform and digitalise, grants such as the Market Readiness Assistance Grant, the Productivity Solutions Grant, the Enterprise Development Grant will be extended or enhanced. This will allow SMEs to tap on new sources of growth with enhanced support from the Government.