PM Lee hopes to announce decision on Jobs Credit Scheme

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PM Lee hopes to announce decision on Jobs Credit Scheme at NTUC conference

SINGAPORE : Prime Minister Lee Hsien Loong hopes to announce the government's decision on extending the Jobs Credit Scheme at the NTUC Ordinary Delegates Conference on October 13.

Speaking at a dialogue with women professionals on employment opportunities in Singapore on Thursday, Mr Lee said the economic situation is more stable now, and monthly trade is steady.

However, for the short-term, Singapore needs to decide what to do when the Resilience Package measures end - in particular, the Jobs Credit Scheme, which has helped the cash flow of companies and save jobs.

Mr Lee said employers and unions are anxious to know if the scheme would be extended. He said the government is reviewing this carefully and will take into account the economic outlook and employment situation in its decision.

Mr Lee said: "We have to prepare ourselves for the world beyond the crisis, when there will be new opportunities, but of course also more competition, and greater uncertainty. We have an Economic Strategic Committee which (Finance Minister) Tharman has been chairing, which has been quietly making progress, thinking about the way ahead for the Singapore economy.

"I think they will have something to report, and to recommend before the Budget next year - which is their objective. But two things are quite clear, even before they report anything. First, that our economy must continue to globalise. And second, we have to maximise the potential of every Singaporean and raise their productivity."

Meanwhile, on Singapore's low total fertility rate, Mr Lee said it is a major concern.

He said there is no sign yet that the government's three marriage and parenthood packages have boosted marriage or fertility rates.

Today, the total fertility rate (TFR) stands at 1.28, just below last year's 1.29. Mr Lee said this may be due to the state of the economy. And even when the economy recovers, it would be difficult to push the TFR to around 1.6, let alone 2.1.

Mr Lee said with an average lifespan of 80 years, Singapore needs 50,000 babies each year. Today, there are only 32,000 citizen births.

- CNA/ms

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Labour chief says Jobs Credit is not here to stay

SINGAPORE: Singapore's labour chief says the Jobs Credit Scheme has bought companies time to upgrade their workers' skills.

This is important to help companies remain competitive. Otherwise, they will relocate overseas.

NTUC Secretary-General Lim Swee Say was speaking to MediaCorp at the 45th anniversary celebrations of the National Community Leadership Institute.

The Jobs Credit Scheme was introduced in January to help save jobs by defraying part of workers' wages.

This is achieved by paying employers 12 percent of workers' wages for the first $2,500 a month.

On 13 October, the government will announce the next step for the scheme.

Unionists want it to be gradually phased out rather than stopped suddenly.

But Mr Lim warned against companies becoming over-reliant on the scheme.

"It's important the government send a clear message to the employers that the Jobs Credit is not here to stay," he said.

- CNA/ir

Rock^Star SG

during recession time last year and early this year. I have heard of this manufacturing company which purposely send its employees for training so as to get the job credit $$. And the training is about workplace cohesiveness. It was taught by a corporate trainer who has knowledge in customer service but none in the manufacturing environment.

And the feedback i got was that it's a waste of time but they don't mind going there to tcss. Anyway, that company has retrenched many workers. And despite production volume picking up, it is still planning another retrenchment.

So perhaps this is the dark side of job credit scheme? people abuse it. Nowhere in the Straits Times was there any mention of abuse. Lots of self praise instead.

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Employers hope Jobs Credit scheme will be extended for another six months

The labour movement is calling for the Jobs Credit scheme to be phased out gradually.

While the Employers Federation or SNEF hopes that the government will continue with it for another six months.

The scheme, which was designed to help firms save jobs during the current economic downturn, ends in December.

And the government is expected to announce its decision on the scheme next Tuesday.

S Ramesh with more :

$4.5 billion dollars.

That's the amount the government has set aside for the one-year Jobs Credit scheme to help companies cope with the economic crisis.

Under the Jobs Credit scheme, employers received a cash grant to keep local workers on their payroll.

The latest payment of 890 million dollars for Jobs Credit was made in September with the final payment due in December this year.

President of the SNEF Stephen Lee.

" Many companies understand that the Jobs credit scheme was designed to be a temporary scheme and it was clearly communicated. So there is of course expectation that it will go away but we would like to see it taper away rather than disappear all together at the end of this year."

There are several reasons for this call.

Some employers and analysts feel that the pickup in the economy has not really taken hold.

Assistant Secretary-General of NTUC Josephine Teo.

"Even in the midst of the Jobs Credit being able to help many companies, we have not been able to avoid restructuring and retrenchments completely. So this worry about us breeding a dependency mentality is overstated."

A recent survey of 180 companies by the SNEF showed that a quarter of them were still implementing measures to avoid retrenchments.

So would the government use reserves once again if it decides to extend the Jobs Credit scheme for another half a year?

Director of the Asia Research Centre at the NanyangTechnological University Dr Tan Khee Giap.

"As the economy recovers next year which I believe it will, then our Budget may not have to be such a big deficit as it was for 2009, so it would be too premature now to say that we would have to go back to the President to withdraw from the Reserves."

Singaporeans will get a better picture of how the country's economy's been fairing when the Trade and Industry Ministry releases its advance GDP estimates for the third quarter of 2009, come Monday morning.

The country's economic outlook and the employment situation would be key factors in determining the future of the Jobs Credit scheme.

--938Live

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Jobs Credit abuse

What happens if an employer who's given the Jobs Credit misuses or abuses the subsidy?

That's one of the questions raised at a dialogue session between residents of Bishan and Toa Payoh and the Minister in the Prime Minister's Office, Second Minister for Finance and Transport, Lim Hwee Hua today (11/10).

Vina Mubtadi reports.

The Jobs Credit scheme was rolled out early this year to help companies cope with the economic crisis.

Under the scheme, employers receive a cash grant to offset a portion of workers’ wages.

But what happens if employers misuse or abuse the subsidy?

William Swee, a Bishan resident who raised the issue, cited a case.

"They (the companies) have received this subsidy in the form of jobs credit from the government. And what happens is this: they have embarked on retrenchment exercise. Then at the same time, they recruited new employees and at the same time, they gave increment to top management personnels. Do you think this is a misuse or abuse of credit?"

Mrs Lim noted that because the subsidy is a cash flow to companies, it's technically difficult to define 'abuse'.

She said it doesn't mean that when the companies retrench workers, they must be abusing the system.

Mrs Lim added that they might just need to be restructured.

"I think it will be difficult to judge it quite quickly. But I think there's enough peer pressure out there for companies to feel like if they had retrenched, they would feel quite bad about it. But if it's because business circumstances regardless of they have tried, they still needed to retrench then I think we'll have to let market forces to work its way."

The Jobs Credit scheme will end in December.

Mrs Lim says the economic outlook and the employment situation would be assessed in determining the future of the scheme.

"The assessment will be based on the economy outlook as we look at it, whether there's a risk of another slowdown, or whether it's going to be one slow recovery process or whether there's a sharp recovery insights. The second issue will be the employment situation. We will have to asses, whether continuing it will help with the employment situation or not."

Mrs Lim says the Jobs Credit Scheme is meant to be temporary and exceptional.

She notes that the government will not let 'short-term solutions become permanent'.

The real long-term challenge is productivity, says Mrs Lim.

"Because we need to be able to survive beyond this downturn, however long it may last. We need to be sure that our Singaporeans will be able to capitalised on any recovery on the growth, therefore we need to work on productivity. We need to make sure that people are properly skilled, so when the recovery takes place, we'll all be ready for it."

The government is expected to announce its decision on the scheme on Tuesday (13/10).

Other issues raised at the dialogue include transportation and infrastructure.

A resident suggested the government build a subterranean network to ease the movement of goods.

Another proposed an automatic escalator, lift or ramp to be built at overhead pedestrian bridges.

--938Live

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Unionists understand that Jobs Credit is not here to stay

The extension of the Jobs Credit scheme may have been well received by the employers as they cheered on the extra help that would steer them through the uncertainty of the economy.

But will this six months be enough and will companies be able to continue retaining jobs after the credit scheme ends ?

Lin Jiamei with the reactions.

When the jobs credit scheme was first announced in the earlier part of this year, it took many by surprise.

Nearly a year later, many companies are feeling the postive impact of the extra helping hand.

But can this impact be sustained when the additional extension ends in April next year.

And the more important question - are companies prepared for it ?

Secretary of the Singaporean-German Chamber of Industry and Commerce, Alexander Melchers.

"I think well managed companies are prepared but I won't say every company is prepared as that would be a bit pretentious. Companies were also not prepared when the Jobs Credit scheme came in and no body expected it so it came as a very positive impact and surprise to the companies. Therefore I am convinced that the companies are prepared and well managed to handle the phase out. But we will have companies for sure who will now say that maybe they will consider retrenchment because the scheme is ending, but this will be the minority of companies. "

And companies by and large understand that the scheme is a temporary measure.

The Singapore Chinese Chamber of Commerce and Industry says having an additional six months will allow the companies to better plan ahead with more effective budgeting measures.

President of the Singapore National Employers Federation, Stephen Lee.

"Employers in general understand that this is a temporary scheme and it will go away. But of course , Jobs Credit is one of the few schemes that puts cash into the company directly. So after tasting it, some companies may say that well they understand that it is going to go away, but can it be a little longer."

But the message is clear.

Companies should not count on any extension, but instead gradually ease their reliance on the Jobs Credit Scheme.

Labour Chief Lim Swee Say.
"From the labour movement's point of view, for the next six months or one to two years, our main focus is no longer on jobs credit. Jobs credit is not here to stay. What we should be focusing on today is that as we freeze up jobs credit, how can we move faster and becom e cheaper, better and faster economy, cheaper through higher productivity, better through better capability and faster through enhanced capabuility. That is the primary focus of the labour movement and the tripartite partners."

--938Live

Rooney9 SG

I hope they change this scheme to those companies who are not doing well only.