Workfare Package of S$1 Billion For Low Wage Workers
Multi-ministry Committee recommends wide-ranging assistance to help low wage Singaporean workers and households.
1. The Ministerial Committee on Low Wage Workers has recommended a package of Workfare measures costing up to $1 billion to help low wage workers. The proposed measures will incentivise work and encourage low wage workers to take on jobs, upgrade their skills and stay employed. It also focuses on children of low wage workers to ensure that the next generation has the skills and know-how to create hope for a better future.
A holistic approach to helping low wage workers
2 To ensure that low wage workers continue to benefit from our economic progress, the Committee recommends a holistic package of sustainable strategies, based on “Workfare”. The desired outcome is for all who can work to find meaningful jobs and earn adequate wages to support themselves and their children. They should be able to own their homes, educate their children, and put aside enough for their medical and retirement needs.
3 The Committee’s recommendations are clustered under six broad spokes within the Workfare framework. These are:
(i) Rewarding Work
(ii) Social Support to Enable Work
(iii) Higher Skills for Better Jobs
(iv) Expand Job Opportunities
(v) Creating Hope for the Future
(vi) Sharing in the Nation’s Progress
Rewarding Work
4 Two key proposals to reward work are the new Workfare Bonus Scheme and the CPF Housing Grant Scheme that will help 300,000 Singaporeans who satisfy work requirements meet daily expenses and own homes.
• Workfare Bonus Scheme
5 To incentivise work, the Committee recommended that the Government reward older, low income workers with a Workfare Bonus if there are budget surpluses. In line with the objective of Workfare, these low wage workers must satisfy a minimum period of work to qualify for the Workfare Bonus. The scheme primarily targets those within the lowest 20% of income earners who earn $1,200 per month or less. There are potentially 300,000 beneficiaries and about 200,000 of them would have fulfilled the minimum work period within the last six months. The Committee recommends that those in the lowest 10% should be given more help. If surpluses allow, we recommend for this group earning $900 or less a month, a Workfare bonus capped at the equivalent of one month’s salary. Correspondingly, those earning more than $900 to $1200 (lowest 20% of income earners) per month could receive a bonus capped at half a month’s salary. To help low wage workers build up their savings to take care of their longer-term needs, the Committee also recommended that 10% of the bonus be credited into the workers’ Medisave Account for their healthcare needs.
• Housing Grants for First Time Buyers
6 To help low wage workers own homes as a tangible reward for their efforts, the Committee recommended that the Government assist low income families with a new CPF housing grant to help purchase their first HDB flat. In line with the objective of Workfare, this grant is contingent on a period of employment.
Recommendations under Other Spokes
7 Key recommendations under the other five spokes include:
i. Social Support to Enable Work
To help low wage workers look after their dependents so that they can return to work, the Committee recommended a new “WorkSupport” programme, as well as enhanced case management to better support these families.
ii. Higher Skills for Better Jobs
To make skills upgrading more accessible and relevant to low wage workers, the Committee recommended:
• Expanding the Workforce Skills Qualifications System (WSQ)
• More training in employability skills.
• More accessible training funds for atypical workers and workers in SMEs..
iii. Expand Job Opportunities
To create more job opportunities, the Committee recommended:
• Accelerating job re-creation efforts to target 10,000 jobs for low wage workers each year.
• Developing more employment opportunities for low wage workers in the informal sector to supplement their Income.
iv. Hope for the Future
The Committee recommended more assistance for children from vulnerable families to complete their education, learn employable skills, and join the workforce by:
• Ensuring education and preschool education remains affordable through enhanced financial assistance for needy students and a start-up grant for kindergarten education.
• Engaging and supporting students and out-of-work youths by extending school counselling and social work programmes to more schools.
• Helping youths acquire employable skills by enhancing vocational training opportunities.
v. Sharing in the Nation’s Progress
The Committee recommended that the Government continues its surplus sharing schemes to low wage workers when the economy is doing well.
8 More details of the 6 spokes of the Workfare Package can be found in the Report by the Ministerial Committee on Low Wage Workers available at www.mom.gov.sg.
Conclusion
9 Low wage workers have shared in Singapore’s prosperity. Their wages have been rising over the years and even the lowest 20% of households by income have accumulated substantial assets. The economic landscape, however, has changed significantly in recent years. Globalisation poses great challenges and low wage workers will find it hard to cope if they do not upgrade their skills and maintain their employability.
10 Through Workfare, low wage workers can continue to share in Singapore’s progress and be rewarded through work. Workfare is a national endeavour that requires the collective effort of all stakeholders in our society: individuals, families, unions, employers, and community-based organisations. The Committee calls on all Singaporeans to work together to address the challenge. Only by working together, can we achieve a competitive, yet equitable Singapore, where there are opportunities and rewards for all.
1. The Ministerial Committee on Low Wage Workers has recommended a package of Workfare measures costing up to $1 billion to help low wage workers. The proposed measures will incentivise work and encourage low wage workers to take on jobs, upgrade their skills and stay employed. It also focuses on children of low wage workers to ensure that the next generation has the skills and know-how to create hope for a better future.
A holistic approach to helping low wage workers
2 To ensure that low wage workers continue to benefit from our economic progress, the Committee recommends a holistic package of sustainable strategies, based on “Workfare”. The desired outcome is for all who can work to find meaningful jobs and earn adequate wages to support themselves and their children. They should be able to own their homes, educate their children, and put aside enough for their medical and retirement needs.
3 The Committee’s recommendations are clustered under six broad spokes within the Workfare framework. These are:
(i) Rewarding Work
(ii) Social Support to Enable Work
(iii) Higher Skills for Better Jobs
(iv) Expand Job Opportunities
(v) Creating Hope for the Future
(vi) Sharing in the Nation’s Progress
Rewarding Work
4 Two key proposals to reward work are the new Workfare Bonus Scheme and the CPF Housing Grant Scheme that will help 300,000 Singaporeans who satisfy work requirements meet daily expenses and own homes.
• Workfare Bonus Scheme
5 To incentivise work, the Committee recommended that the Government reward older, low income workers with a Workfare Bonus if there are budget surpluses. In line with the objective of Workfare, these low wage workers must satisfy a minimum period of work to qualify for the Workfare Bonus. The scheme primarily targets those within the lowest 20% of income earners who earn $1,200 per month or less. There are potentially 300,000 beneficiaries and about 200,000 of them would have fulfilled the minimum work period within the last six months. The Committee recommends that those in the lowest 10% should be given more help. If surpluses allow, we recommend for this group earning $900 or less a month, a Workfare bonus capped at the equivalent of one month’s salary. Correspondingly, those earning more than $900 to $1200 (lowest 20% of income earners) per month could receive a bonus capped at half a month’s salary. To help low wage workers build up their savings to take care of their longer-term needs, the Committee also recommended that 10% of the bonus be credited into the workers’ Medisave Account for their healthcare needs.
• Housing Grants for First Time Buyers
6 To help low wage workers own homes as a tangible reward for their efforts, the Committee recommended that the Government assist low income families with a new CPF housing grant to help purchase their first HDB flat. In line with the objective of Workfare, this grant is contingent on a period of employment.
Recommendations under Other Spokes
7 Key recommendations under the other five spokes include:
i. Social Support to Enable Work
To help low wage workers look after their dependents so that they can return to work, the Committee recommended a new “WorkSupport” programme, as well as enhanced case management to better support these families.
ii. Higher Skills for Better Jobs
To make skills upgrading more accessible and relevant to low wage workers, the Committee recommended:
• Expanding the Workforce Skills Qualifications System (WSQ)
• More training in employability skills.
• More accessible training funds for atypical workers and workers in SMEs..
iii. Expand Job Opportunities
To create more job opportunities, the Committee recommended:
• Accelerating job re-creation efforts to target 10,000 jobs for low wage workers each year.
• Developing more employment opportunities for low wage workers in the informal sector to supplement their Income.
iv. Hope for the Future
The Committee recommended more assistance for children from vulnerable families to complete their education, learn employable skills, and join the workforce by:
• Ensuring education and preschool education remains affordable through enhanced financial assistance for needy students and a start-up grant for kindergarten education.
• Engaging and supporting students and out-of-work youths by extending school counselling and social work programmes to more schools.
• Helping youths acquire employable skills by enhancing vocational training opportunities.
v. Sharing in the Nation’s Progress
The Committee recommended that the Government continues its surplus sharing schemes to low wage workers when the economy is doing well.
8 More details of the 6 spokes of the Workfare Package can be found in the Report by the Ministerial Committee on Low Wage Workers available at www.mom.gov.sg.
Conclusion
9 Low wage workers have shared in Singapore’s prosperity. Their wages have been rising over the years and even the lowest 20% of households by income have accumulated substantial assets. The economic landscape, however, has changed significantly in recent years. Globalisation poses great challenges and low wage workers will find it hard to cope if they do not upgrade their skills and maintain their employability.
10 Through Workfare, low wage workers can continue to share in Singapore’s progress and be rewarded through work. Workfare is a national endeavour that requires the collective effort of all stakeholders in our society: individuals, families, unions, employers, and community-based organisations. The Committee calls on all Singaporeans to work together to address the challenge. Only by working together, can we achieve a competitive, yet equitable Singapore, where there are opportunities and rewards for all.
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