TL;DR – Mr Desmond Choo, Assistant Secretary-General of NTUC shared that sustainable wage growth is the best solution against long-term inflation in Parliament on Monday.
It’s official. With effect from 1 Jan 2023, GST will increase from 7 to 8 per cent and from 8 to 9 per cent from 1 Jan 2024.
Deputy Prime Minister Lawrence Wong announced in Parliament on Monday (7 Nov) that the Government will spend S$1.4 billion more to make up for the GST increase. This amount will help most Singaporean households for at least five years and around 10 years for lower-income households.
The Assurance Package was first announced by then-Finance Minister Heng Swee Keat in 2020, at S$6 billion. To support workers when GST kicks in next year, the S$6.6 billion will be boosted to S$8.0 billion. Here is the breakdown of measures under the Assurance Package:
- Every adult Singaporean will receive between S$700 and S$1,600. Depending on the individual’s income, this amount varies. Payouts will be disbursed over five years, from 2022 to 2026.
- Eligible seniors will receive a special GSTV – Cash (Seniors’ Bonus) amounts from S$600 to S$900. It will benefit about 850,000 lower-income seniors. The special GSTV – Cash (Seniors’ Bonus) will be disbursed over three years, from 2023 to 2025.
- Eligible HSB households will receive additional U-Save rebates – from S$330 to S$570 on top of the regular GSTV. Depending on the flat type, this amount will vary. This will benefit about 950,000 households. The additional U-Save rebates for 2023 will be credited in January 2023.
- All Singaporean children (aged 20 years and below) and seniors (aged 55 and above) will receive MediSave top-ups totalling S$450.
- All Singaporean households will receive two tranches of CDC vouchers worth S$200 each in 2023 and 2024.
- The Government will provide grants of S$12 million will be provided to Self-Help Groups (CDAC, Yayasan Mendaki, SINDA, Eurasian Association) over four years.
- The Citizens’ Consultative Committee ComCare Fund (CCF) will receive a top-up of S$5 million over a period of 5 years to further support vulnerable households.
We cannot depend on special packages indefinitely
This year, NTUC launched a S$3.7 million NTUC Care Fund (Special assistance) Programme in August to help 28,000 lower-wage workers defray their daily expenses caused by the rise in inflation.
While supplementary packages can help to relieve the rising cost of living, Mr Desmond Choo, Assistant Secretary-General of NTUC shared that sustainable wage growth is the best solution against long-term inflation in Parliament on Monday.
To achieve this, companies must increase productivity through the following means.
This is essential to help our workers get better jobs and better pay.
- Businesses need to rethink business models
This will allow them to capitalize on technology to increase productivity. In partnership with the government, NTUC has set up Company Training Committees (CTC) to foster and propagate transformation at the firm level.
By the end of 2025, 2,500 CTCs will develop the Operation & Technology Roadmap (OTR) programme with companies. OTR can assist businesses to use innovation and technology to move up the value chain and in turn, workers can be more productive.
- Progressive Wage Model (PWM)
PWM served both economic and social purposes by keeping income gaps tighter.
Earlier in September, PWM expanded to the Retail sector and workers will see around an 8.5% wage increase. Next year, PWM will expand to the Food Services and Wage Management sectors.
Click on the article below to read about how NTUC is moderating the Costs of Living so that essential goods remain affordable for lower-income households.