Transcript of Deputy Prime Minister Lawrence Wong's Opening Remarks at the Off-Cycle Support Package Press Conference on 21 June 2022
21 Jun 2022Good morning. Over the past two years, we have been gathering here regularly for MTF press conferences. The pandemic is not over, but now we have to tackle yet another major challenge involving the economy and inflation. Today's conference is not about MTF work. Instead, my colleagues and I will provide an update on the economic and inflation outlook, and we will share the details of the package of additional measures to help Singaporeans, especially the lower-income groups and the more vulnerable segments in our society.
We had anticipated the rise in prices at the start of this year, and that is why we responded with a comprehensive set of measures in the Budget to cushion the impact on Singaporeans. In April, we brought forward some of the Budget measures including the disbursement of the CDC vouchers, and the Small Business Recovery Grant. There are still other measures being rolled out in the coming months, for example, the Service and Conservancy Charges and U-Save rebates.
Since then, the global growth and inflation environment has proved to be more challenging. The Ukraine war has put tremendous stresses on global supply chains, and protectionist measures by countries has compounded supply chain disruptions. Global energy and food prices have risen sharply, and we must expect global inflation to broaden to other areas and even to pick up further before it stabilises and gets better.
Compared to other countries, Singapore is in a stronger position to deal with these economic challenges. Nevertheless, as a small and open economy, we have not been spared from the effects of higher prices. Indeed, over the last few months, we have seen prices going up steadily, especially for energy and food. The inflation situation will eventually stabilise, both globally and within Singapore. But for now, we must expect price increases to continue in the coming months. In particular, energy prices are likely to remain elevated for the rest of the year.
This is why I decided to introduce a new $1.5 billion support package to provide immediate and targeted relief for Singaporeans. The support measures in this package are tilted towards helping our lower-income and vulnerable groups, because they are the ones who are disproportionately impacted by the effects of inflation. Let me go through the key items in this package.
First, we will permanently strengthen support for households that are most in need. In particular, I will enhance the ComCare Short-to-Medium-Term Assistance and Long-Term Assistance rates. The Singapore Allowance and monthly pension ceiling for pensioners who draw lower pensions will also be enhanced in tandem. These enhancements to the rates will help them with a higher cost of living on a permanent basis.
Second, I will extend a one-off GSTV-Cash Special Payment of up to $300 in August. This will benefit lower- to middle-income workers as well as retirees without income, so all together about 1.5 million Singaporeans, and this is over and above the enhancement to GSTV-Cash I had announced in the Budget, which means taken together, GSTV-Cash recipients will receive up to $700 in August this year.
Third, we will continue to look out for lower-income and vulnerable workers during this difficult period. One way is to ensure that employers continue to hire and pay lower wage workers higher and better wages as part of our Progressive Wage Model. To give this a further push, I will enhance the Progressive Wage Credit Scheme this year so that the Government takes on a larger proportion of the wage increases, and this enhancement will also help to reduce the cost burden for employers. I will also extend the Jobs Growth Incentive to sustain support for employers that hire more vulnerable workers. This extension will be for six months from October this year, to March 2023. SMS Chee will share more details later, in particular about the parameters of the Progressive Wage Credit Scheme.
Fourth, we will continue to help Singaporean households with the sharp rise in utilities bills. In the Budget, I have already provided a fair amount of U-Save rebates for those living in HDB flats, with more given to those living in smaller flats. So this time, I will provide a one-off $100 Household Utilities Credit to all Singaporean households, including those living in private property.
Fifth, we will also provide more help for businesses as well as specific segments. These specific segments include self-employed persons who rely on their vehicles for their livelihood, as well as those who are impacted by the export ban on live chickens. For businesses in this higher energy cost environment, they will need to continue to restructure and become more energy efficient in order to remain competitive. We will provide support to firms who need that extra lift to sustain their transformation efforts. SMS Chee and SMS Koh Poh Koon will share the details of these measures later on.
I know many Singaporeans are concerned about the immediate issues of rising prices and cost of living, please understand that the challenges before us are not just about inflation, they are also about adapting to major structural changes in our operating environment – rising temperatures and climate change; increased geopolitical contestation and tensions, potentially moving into a more bifurcated and decoupled world. We have to fundamentally restructure and transform ourselves for this new world, a world which is likely to be more uncertain, volatile and even more dangerous than before, and that is why we have to accelerate, not slow down our economic reforms. We have to keep on moving forward to restructure and transform ourselves. At the same time, it is also important that we move forward in a fiscally responsible and sustainable manner. This will ensure that we are in a strong economic and fiscal position to deal with any future challenges ahead and also to seize the opportunities in this new environment.
On that note, let me end with a few words on how we are funding this new $1.5 billion package. We are able to do so without a further draw on our Past Reserves. This is because we expect our fiscal outturn for FY2021 to improve, compared to the estimates at Budget 2022. We collected higher revenues due to the stronger-than-expected economic recovery last year, and used less of the budget set aside for COVID-19 spending, as the Omicron variant turned out to be less severe than anticipated. We will not need to pass a Supplementary Budget at this point. We are still early in the Financial Year and Parliament had just approved the Budget for FY2022 just three months ago. Ministries will reprioritise within their existing budgets to fund this package.
We are dealing with multiple crises at the same time – COVID-19, global economic slowdown and inflation, but I trust in our collective ability to stand united and work together to tackle these challenges. We have done so in the past two years fighting COVID-19, and we have shown that we are stronger when we stand together. We have to brace ourselves for a bumpy ride ahead. The situation is highly fluid, and the Government will continue to monitor it closely and adjust our measures and programmes as necessary. We will be upfront in sharing with Singaporeans the challenges ahead and how we intend to go about tackling them. The bottom line is that we are all in this together. I am confident that we will get through this together, as one united people
Let me say a few words in Mandarin before I invite my colleagues to speak.
大家早上好。我知道，最近大家都很关注物价上涨的问题。政府在今年的财政预算案推出了不 少措施，减轻国人的生活负担。
但是，随着全球的能源和粮食价格不断上升，新加坡也受到了影响。我们必须做好准备，物价 可能会长时间维持在高水平，这将对低收入家庭和工友带来更大的影响。
所以，政府将推出额外的援助配套，主要帮助低收入人士和弱势群体。
这包括，为个人和家庭提供现金援助和水电费回扣。
这个配套也将继续推动企业和劳动队伍的转型，支持本地企业增加竞争力，并帮助较低薪员工 提升技能和收入。
政府会提供津贴，鼓励中小型企业，采用节能设备，减少能源用量，从而减低费用。我们也会 帮助本地企业，更好应付现金周转的问题。
这个配套总值15亿元，无需动用储备金。我希望这能帮助个人、家庭和企业减轻一些压力。
政府会继续密切关注情况的发展，也随时准备好，在有需要的时候，为国人提供进一步的援 助。
就好像这两年来，我们风雨同舟，齐心协力，对抗疫情;我相信，只要大家上下一心，团结一 致，我们这次也一定可以一起克服这个难关。
谢谢。
We had anticipated the rise in prices at the start of this year, and that is why we responded with a comprehensive set of measures in the Budget to cushion the impact on Singaporeans. In April, we brought forward some of the Budget measures including the disbursement of the CDC vouchers, and the Small Business Recovery Grant. There are still other measures being rolled out in the coming months, for example, the Service and Conservancy Charges and U-Save rebates.
Since then, the global growth and inflation environment has proved to be more challenging. The Ukraine war has put tremendous stresses on global supply chains, and protectionist measures by countries has compounded supply chain disruptions. Global energy and food prices have risen sharply, and we must expect global inflation to broaden to other areas and even to pick up further before it stabilises and gets better.
Compared to other countries, Singapore is in a stronger position to deal with these economic challenges. Nevertheless, as a small and open economy, we have not been spared from the effects of higher prices. Indeed, over the last few months, we have seen prices going up steadily, especially for energy and food. The inflation situation will eventually stabilise, both globally and within Singapore. But for now, we must expect price increases to continue in the coming months. In particular, energy prices are likely to remain elevated for the rest of the year.
This is why I decided to introduce a new $1.5 billion support package to provide immediate and targeted relief for Singaporeans. The support measures in this package are tilted towards helping our lower-income and vulnerable groups, because they are the ones who are disproportionately impacted by the effects of inflation. Let me go through the key items in this package.
First, we will permanently strengthen support for households that are most in need. In particular, I will enhance the ComCare Short-to-Medium-Term Assistance and Long-Term Assistance rates. The Singapore Allowance and monthly pension ceiling for pensioners who draw lower pensions will also be enhanced in tandem. These enhancements to the rates will help them with a higher cost of living on a permanent basis.
Second, I will extend a one-off GSTV-Cash Special Payment of up to $300 in August. This will benefit lower- to middle-income workers as well as retirees without income, so all together about 1.5 million Singaporeans, and this is over and above the enhancement to GSTV-Cash I had announced in the Budget, which means taken together, GSTV-Cash recipients will receive up to $700 in August this year.
Third, we will continue to look out for lower-income and vulnerable workers during this difficult period. One way is to ensure that employers continue to hire and pay lower wage workers higher and better wages as part of our Progressive Wage Model. To give this a further push, I will enhance the Progressive Wage Credit Scheme this year so that the Government takes on a larger proportion of the wage increases, and this enhancement will also help to reduce the cost burden for employers. I will also extend the Jobs Growth Incentive to sustain support for employers that hire more vulnerable workers. This extension will be for six months from October this year, to March 2023. SMS Chee will share more details later, in particular about the parameters of the Progressive Wage Credit Scheme.
Fourth, we will continue to help Singaporean households with the sharp rise in utilities bills. In the Budget, I have already provided a fair amount of U-Save rebates for those living in HDB flats, with more given to those living in smaller flats. So this time, I will provide a one-off $100 Household Utilities Credit to all Singaporean households, including those living in private property.
Fifth, we will also provide more help for businesses as well as specific segments. These specific segments include self-employed persons who rely on their vehicles for their livelihood, as well as those who are impacted by the export ban on live chickens. For businesses in this higher energy cost environment, they will need to continue to restructure and become more energy efficient in order to remain competitive. We will provide support to firms who need that extra lift to sustain their transformation efforts. SMS Chee and SMS Koh Poh Koon will share the details of these measures later on.
I know many Singaporeans are concerned about the immediate issues of rising prices and cost of living, please understand that the challenges before us are not just about inflation, they are also about adapting to major structural changes in our operating environment – rising temperatures and climate change; increased geopolitical contestation and tensions, potentially moving into a more bifurcated and decoupled world. We have to fundamentally restructure and transform ourselves for this new world, a world which is likely to be more uncertain, volatile and even more dangerous than before, and that is why we have to accelerate, not slow down our economic reforms. We have to keep on moving forward to restructure and transform ourselves. At the same time, it is also important that we move forward in a fiscally responsible and sustainable manner. This will ensure that we are in a strong economic and fiscal position to deal with any future challenges ahead and also to seize the opportunities in this new environment.
On that note, let me end with a few words on how we are funding this new $1.5 billion package. We are able to do so without a further draw on our Past Reserves. This is because we expect our fiscal outturn for FY2021 to improve, compared to the estimates at Budget 2022. We collected higher revenues due to the stronger-than-expected economic recovery last year, and used less of the budget set aside for COVID-19 spending, as the Omicron variant turned out to be less severe than anticipated. We will not need to pass a Supplementary Budget at this point. We are still early in the Financial Year and Parliament had just approved the Budget for FY2022 just three months ago. Ministries will reprioritise within their existing budgets to fund this package.
We are dealing with multiple crises at the same time – COVID-19, global economic slowdown and inflation, but I trust in our collective ability to stand united and work together to tackle these challenges. We have done so in the past two years fighting COVID-19, and we have shown that we are stronger when we stand together. We have to brace ourselves for a bumpy ride ahead. The situation is highly fluid, and the Government will continue to monitor it closely and adjust our measures and programmes as necessary. We will be upfront in sharing with Singaporeans the challenges ahead and how we intend to go about tackling them. The bottom line is that we are all in this together. I am confident that we will get through this together, as one united people
Let me say a few words in Mandarin before I invite my colleagues to speak.
大家早上好。我知道，最近大家都很关注物价上涨的问题。政府在今年的财政预算案推出了不 少措施，减轻国人的生活负担。
但是，随着全球的能源和粮食价格不断上升，新加坡也受到了影响。我们必须做好准备，物价 可能会长时间维持在高水平，这将对低收入家庭和工友带来更大的影响。
所以，政府将推出额外的援助配套，主要帮助低收入人士和弱势群体。
这包括，为个人和家庭提供现金援助和水电费回扣。
这个配套也将继续推动企业和劳动队伍的转型，支持本地企业增加竞争力，并帮助较低薪员工 提升技能和收入。
政府会提供津贴，鼓励中小型企业，采用节能设备，减少能源用量，从而减低费用。我们也会 帮助本地企业，更好应付现金周转的问题。
这个配套总值15亿元，无需动用储备金。我希望这能帮助个人、家庭和企业减轻一些压力。
政府会继续密切关注情况的发展，也随时准备好，在有需要的时候，为国人提供进一步的援 助。
就好像这两年来，我们风雨同舟，齐心协力，对抗疫情;我相信，只要大家上下一心，团结一 致，我们这次也一定可以一起克服这个难关。
谢谢。