SG Budget 2024: Aiding Families, Uplifting Mid-Career, Lower-Wage Workers

What awaits Singaporeans this 2024 and beyond? Last month, on Feb. 16, Deputy Prime Minister and Finance Minister Lawrence Wong delivered the statement for Budget 2024 in Parliament, where he outlined the government's fiscal focus from April 1, 2024 to March 31, 2025.

Wong said that the outlook for the year is "mixed," acknowledging that economic growth is expected but so are geopolitical risks. The goal, thus, is to focus on the concrete steps to create Singapore’s shared future, namely, to tackle the immediate roadblocks for households and businesses; pursue better jobs and equip Singaporean workers; create paths for equality and mobility; provide assurance for families and seniors; and forge a stronger, more united Singapore.

Here's what kind of support and enhancements shared households, young families, seniors, and workers can expect from Budget 2024, from living costs and retirement to upskilling opportunities and increased minimum hourly rates.

Support for Households, Families, and Seniors

Inflation began to moderate in 2023, yet economic growth also slacked off, which led to a decline in incomes. While it's expected that 2024 will be better than last year, Wong vowed to further enhance the Assurance Package, giving an additional S$600 in Community Development Council (CDC) Vouchers for all Singaporean households.

The first S$300 is slated to be distributed by the end of June this year and the other half in January 2025. CDC Vouchers may be used in participating hawkers, heartland merchants, and supermarkets in the city-state.

Moreover, the government will be replenishing the Goods and Services Tax (GST) Voucher Fund by S$6 billion, which offers financial aid to low-income households and individuals in Singapore.

Wong believes that families must be supported at every stage, starting with children. To give Singaporean children a fighting chance in education, Wong proposed to lower the monthly childcare fee caps in government-support preschools in 2025, namely S$640 for anchor operators and S$680 for partner operators. Existing preschool subsidies for lower-income families will be enhanced, from children with working mothers to all children from lower-income families, benefitting up to 17,000 children.

Meanwhile, seniors can look forward to enhancements to the Central Provident Fund (CPF) system, where the contribution rate for senior workers aged 55-65 will be upped by 1.5% in 2025.

The Enhanced Retirement Sum will likewise be increased from thrice the Basic Retirement Sum to four times beginning in 2025. Seniors, thus, can expect the ERS to be S$426,000 next year, allowing them to receive bigger payouts from CFS if they choose to.

Rationalising the CPF system is also in order. Special Accounts of those aged 55 and above shall be closed in 2025, transferring the savings therein to the Retirement Account to earn long-term interest rates.

The quarterly Silver Support Scheme for seniors who had low incomes during their work years will also be enhanced, with the qualifying per capita household threshold raised from S$1,800 to S$2,300 and the quarterly payments increased by 20%.

Support for Mid-Career and Lower-Wage Workers

Mid-career workers will likewise be seeing a lift this year, with Wong vowing to bolster the SkillsFuture programme almost 10 years since its inception to offer training courses for employees in their 40s and 50s with financial and caregiving obligations. A new SkillsFuture Level-Up Programme will be created for Singaporeans aged 40 and above, giving them a top-up of S$4,000 in SkillsFuture Credit.

The top-up will be distributed this May and shall be used for selected training programmes leading to a part-time and full-time diploma, post-diploma, undergraduate programmes, and courses for those in the Progressive Wage Model sectors.

Mid-career workers aged 40 and above who wish to reskill will also be given subsidies to pursue a different diploma at Singapore's polytechnics, Institute of Technical Education, and arts institutions beginning in 2025.

Even more, mid-career workers aged 40 and above who enrol in selected full-time courses will be provided with a monthly training allowance to support the entire duration of a SkillsFuture Career Transition Programme.

Lower-wage workers will also be accounted for, with enhancements to the Workforce Income Supplement scheme slated for 2025. The qualifying income cap was raised by Wong from S$2,500 to S$3,000, whereas the workfare payouts were also increased so lower-wage senior workers can earn a maximum annual payout of S$4,900 from S$4,200, which took effect last month.

Foreign workers will also benefit from the increase in the Local Qualifying Salary, from S$1,400 to S$1,600 in 2024, with the minimum hourly rate hiked to S$10.50 from S$9.

Meanwhile, employers who increase the wages of their lower-wage workers can expect support from Wong, who raised the co-funding levels of the Progressive Wage Credit Scheme (PWCS) from 30% to a maximum of 50% to help with rising business costs.

The PCWS wage ceiling will also be upped from S$2,500 to S$3,000 by 2025, as per Wong, while the PWCS will be freshly topped up by S$1 billion.

The PCWS was launched in 2022 during the height of the pandemic, so the government could co-fund the wage hike of lower-wage workers with businesses.