GOVERNMENT TRAINING PRODUCTIVITY
Singapore - Ensuring that Singaporean Small and Medium Enterprises (SMEs) have a strong succession pipeline of talent will be critical if these firms want to grow, said Finance Minister Tharman Shanmugaratnam in his budget statement for 2010 yesterday.
This is why the government has pledged a sum of $45 million over the next five years to enhance SPRING's Business Leaders Initiative. The initiative is an umbrella programme aimed at attracting young talent into SMEs, as well as helping groom the next generation of SME managers and entrepreneurs.
"Our universities and polytechnics are putting more effort into exposing their students to industry. More than half of their students now go on at least one industry attachment by the time they graduate," Tharman added.
Other budget announcements that will affect HR practitioners include:
Expansion of the Continuing Education and Training (CET) System
- The government will spend $2.5 billion over the next five years on CET, to build an outstanding CET system for adults. This will allow employees to develop competence in more complex tasks, mastery of skills and depth of expertise in every trade and profession.
Introduction of Workfare Training Scheme (WTS)
- The government will introduce a three-year Workfare Training Scheme (WTS) to complement the Workfare Income Supplement (WIS) scheme.
The WTS will:
- Subsidise 90% to 95% of absentee payroll and course fee outlay for employers, when they send their low-wage workers for training;
- Provide cash grants, capped at $400 per year, when WIS recipients complete their training;
- Introduce a structured training programme for those with very low skills, including those who are unemployed.
Enhancement of Workfare Income Supplement
- The government will enhance the Workfare Income Supplement (WIS) Scheme as follows:
- Higher payouts. Maximum payouts for the WIS will be increased by between $150 and $400, with more going to older workers to encourage them to remain in the workforce; and
- Extension to more workers.The government will extend WIS to workers earning up to $1,700 per month – up from the current limit of $1,500 per month.
Enhanced tax deduction for training costs
- Under the new Productivity and Innovation Credit scheme, the government will grant a 250% tax deduction for the first $300,000 of expenditure on qualifying workers’ training. This enhanced tax deduction can be enjoyed on top of the training support under the WTS and other WDA programmes.
Foreign worker levies to be raised
- As a first step, the government will raise levy rates for most Work Permit by between $10 and $30 on 1 Jul 2010, phasing in further adjustments in levy rates and tiers in 2011 and 2012. Taking the three years together, there will be a total increase of about $100 in average levies per worker in manufacturing and services. The construction sector, where there is much scope for productivity improvements, will see a larger increase.
In July 2010, the government will also sub-divide the current single rate ($50) for S Pass workers for all sectors, to two tiers ($100 and $120). Further adjustments will then be phased in until the rates reach $150 and $250 by July 2012.
The overall dependency ratio for all categories of foreign workers (Work Permit and S Pass holders) will remain unchanged.
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