During the Budget debate which took place from Feb. 22 to 24, several Workers’ Party (WP) Members of Parliament (MP) made proposals concerning the needs of the less fortunate in society, as well as the re-employability of workers on Feb. 23.
Jamus Lim’s employment-related proposals
Increase employer CPF contribution rate to 20 per cent
MP for Sengkang GRC Jamus Lim referred to the announcement in Deputy Prime Minister Lawrence Wong’s Budget speech that the CPF monthly salary ceiling will be raised from S$6,000 to S$8,000 by 2026.
He proposed that instead, the employer’s CPF contribution rate be raised to 20 per cent, up from the current rate of 17 per cent. According to Lim, 20 per cent was a status quo until the Asian Financial Crisis in the 1990s.
This, he said, would help households by not reducing their take-home pay, while also ensuring retirement savings adequacy.
“While I understand the need to provide employers with relief in the wage bill during a recession, we aren’t in one now,” he said.
While restoring the employer contribution rate would not fully make up for an increased monthly CPF ceiling, Lim said it could have been considered as part of the measures to tackle high inflation.
Introduce redundancy insurance for up to 6 months
Lim also proposed to introduce redundancy insurance for workers who recently lost their jobs.
“This government likes to reiterate that “a job is the best welfare.” But what happens when our workers lose their jobs, for reasons little related to their performance or ability?” he questioned.
“ It seems to me that, as a society, we will need to help these workers get back on their feet. In other words, we need a backup support system for redundant workers to access their first, best welfare system, which is a job,” he added.
For the redundancy insurance, Lim suggested a coverage duration of up to six months. According to Lim, this was lower than the one-year or more common in schemes implemented by other countries.
He also proposed a payout of 40 per cent of the last drawn salary, which he considered an average but lower than other advanced economies offer, with a coverage duration of six months.
Importance of flexibility
In his proposal, Lim also stressed the importance of flexibility, in a sense workers who were made redundant may choose to frontload their benefits if they have any urgent bills to settle.
They may also opt to rely on their savings initially and only receive payouts later if their unemployment stretches longer than anticipated.
Lim acknowledged the “moral hazard” concern that workers may be encouraged to quit their jobs, because they could rely on this scheme. However, he said this proposal is for involuntary redundancy, and studies in advanced economies that have rolled out similar schemes found “little adverse effects”.
He also asked the government to consider extending this to self-employed persons into the scheme with different contribution shares such as the one implemented during the pandemic.
You can watch Lim’s full speech here.
He Ting Ru’s child welfare and housing-related proposals
Extend baby bonuses to single mothers
He Ting Ru, also a Workers’ Party Sengkang MP, highlighted the plight of single mothers and couples who are childless in her speech.
According to He, these groups seemed to be left out during the headline announcements in the Budget statement.
“They are Singaporeans too and are and will continue to be part of our families. This is concerning in an age where we trumpet greater inclusivity and claim to celebrate diversity, especially as the number of single Singaporeans has increased across all age groups, according to the 2020 census.”
He said that single unmarried mothers are left out of the enhanced Baby Bonus and singles are generally more adversely affected by the increase in rental prices.
“It, therefore, behooves us as a society to ask that our enhanced Baby Bonus and parenthood policies are extended equally to all parents,” she said.
In discouraging single parenthood, she said that the policies appear to be either “punishing innocent children born to unmarried mothers”, or encouraging hasty, possibly unsuitable marriages. This could lead to strife further down the line, leading to divorce.
She argued that due to the low number of childbirths by single parents, under 1,000 a year, financially supporting them would not be significant.
Lowering age for singles to purchase new flats
He also touched on the changing demographics in Singapore, which led to more singles across age groups.
As such, WP believes that the singles should be allowed to purchase new flats from the age of 28, instead of the current 35 years old.
She added that her fellow Sengkang WP MP Louis Chua also stated the limited impact on the housing shortage on married couples seeking home, as singles tend to apply for smaller flats.
Concluding her speech, He hoped that Singapore will make true and meaningful progress that Singaporeans will support them and to better navigate the challenges ahead.
You can watch her full speech here.
Top images via CNA