MINISTRY OF FINANCE   GOVERNMENT

Singapore - Employers hoping to get an extension in the Jobs Credit scheme can expect to get a reply from the government by mid-October.

The Finance Ministry disclosed this decision yesterday, as reported by The Straits Times. 

The outcome will be welcomed by the business community as many companies are currently in the process of firming up their business plans and budgets for 2010.

"We are already well into September," said Teng Theng Dar, chief executive officer of Singapore Business Federation. "For companies operating on a calendar-year-basis, they should be in the process of situation analysis, firming up key assumptions for deliberating business plans and budgets in 2010."

The $4.5 billion Job Credit scheme was a year-long measure introduced to help companies hold on to their workers amid the recession. Under this scheme, the government helps employers defray part of local worker's wage bill.

Teng said, "The scheme has worked well and has been useful in helping companies, particularly smaller companies, tide over their manpower and overall cash flow concerns and needs."

Economists from Nanyang Technological University, however, say that the scheme should not be extended as this would distort business decision-making and erode economic competitiveness.

Citigroup economist, Kit Wei Zhang, suggested fine-tuning the scheme to benefit those who need help most, such as low-wage workers and troubled sectors like manufacturing.

He also said that the subsidy level should be reduced progressively for employers to ease in the changes.

 

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