Singapore – How effective is the Jobs Credit Scheme? While some have lauded it, others say the scheme can only focus on tiding Singapore through these tough times, at best.

During the PricewaterhouseCooper’s (PwC) Budget Seminar’s panel discussion conducted recently, Inderjit Singh, chairman of the Government Parliamentary Committee for the Ministry of Finance claims that the Jobs Credit Scheme is ineffective as it does not help reduce cost in many other areas. “This will definitely not help Singapore’s economy make a comeback.”

At the moment, the main purpose of the Jobs Credit Scheme is to help reduce costs for employers, hopefully translating into retaining jobs and even creating some more. 

According to Peter Tan, tax partner at PricewaterhouseCoopers Services LLP (Singapore), the limitation of the Jobs Credit Scheme is that it cannot provide the assurance of job retention, as businesses need to look into its own sustainability - and staff costs only one aspect of the entire business. 

Tan adds that payment is made to employers with no strings attached, under the job credit scheme and this means that they are free to utilize the money in any way that they choose. “The payment is made in good faith that the money will be applied directly or indirectly for the benefit of the employees.”

However, staff retention might not be the biggest issue facing HR practitioners today, says Tan. Instead, creating high staff morale in today’s conditions would be a more crucial task, especially for those who feel concerned about their job security. And that is when HR is not able to assist as such decisions depend on the organisation's senior managemen instead. 

"Ultimately,it is good to have certainty and as much transparency as possible as it will help employees with their personal plans. There is nothing worse than going through the motion of daily work with the cloud of insecurity hanging over one's head," says Tan.