Aviation sector to get 50% wage support for local employees to help retain workforce

Aviation sector to get 50% wage support for local employees to help retain workforce

The Big Read Feb 13 (1)
With Singapore Airlines going through its worst crisis in its 48-year history, the Government has also repeatedly pledged to do all it can to help the national carrier, given the key role it has played in developing Changi Airport as an aviation hub. (Photo: Ili Nadhirah Mansor/TODAY)

SINGAPORE: Companies in the aviation sector will receive 50 per cent support for wages paid to local employees from April to September, as part of the Government's support to help the sector tide through the COVID-19 pandemic, said the Ministry of Transport (MOT) on Wednesday (Feb 17).

This is part of the S$870 million OneAviation Support Package which was announced by Deputy Prime Minister Heng Swee Keat in his Budget 2021 speech on Tuesday.

Under a six-month extension to the Jobs Support Scheme (JSS), aviation companies will receive wage support of 30 per cent from April to June, and 10 per cent support for wages from July to September. 

On Wednesday, MOT said that there will be enhanced manpower support amounting to S$330 million as one of two key components in the OneAviation Support Package. 

The Aviation Workforce Retention Grant will top up support to 50 per cent of wages for each Singaporean or permanent resident employee from April to September, up to a cap of S$4,600 of gross monthly wages.

This means that eligible companies will receive additional 20 per cent wage support from April to June, and an additional 40 per cent from July to September.

Companies that are based principally at Changi Airport will receive the grant, said MOT. These companies are already receiving Tier 1 support under the JSS, covering 50 per cent of wages until March.

READ: What you need to know about Budget 2021

The aviation package also covers an extension of the Enhanced Training Support Programme for companies in the sector until December, said MOT.

"On top of this, Singapore-based airlines will receive support to convert some of their existing pilots to operate other aircraft types, to provide an adequate pool of trained pilots to support the eventual recovery," added the ministry.

With global air travel affected by the pandemic, the ministry noted that many aviation companies have reduced their headcounts over the past year.

"Our key aviation companies have also done likewise in a very judicious manner, mostly affecting foreign manpower," said MOT.

"We must avoid further reductions to the aviation workforce so that companies will not lose their core local capabilities, which has taken many years to build up. If the sector weakens its capabilities, this will hamper its ability to recover."

READ: Extension of Jobs Support Scheme among S$8 billion worth of measures announced by Heng Swee Keat

MORE COST RELIEF

A second key component of the OneAviation Support Package is cost relief amounting to S$540 million. 

Aviation companies have been unable to recover their costs of operations during the pandemic due to the sharp fall in passenger volume, even as higher costs are incurred due to stringent measures to enable safe air travel and minimise risk for airport workers, said MOT.

These include bio-safety and safe management measures, segregation of passengers who are transiting through or entering Singapore and systems to support on-arrival testing for COVID-19.

READ: SIA Group's passenger carriage down 97.3% in January as demand for air travel remains 'depressed'

To help companies meet these costs, existing rebates on fees and charges at Changi Airport and Seletar Airport will be extended for another year until Mar 31, 2022, said the ministry.

The extended cost relief for airlines covers full rebates on parking charges at Changi Airport and fees for the Certificates of Airworthiness payable by Singapore-based carriers.

Airlines and ground handlers will continue to receive a 50 per cent rebate on rental for lounges and offices at the two airports' terminals.

A 10 per cent rebate on landing charges will continue for all scheduled passenger and freighter flights landing in Singapore.

A 1 per cent increase in landing, parking and aerobridge charges at Changi Airport will also continue to be waived for this period, including for freighter flights.

READ: The Big Read: Pummelled by COVID-19, Singapore's economy to begin K-shaped recovery with Budget 2021

Ground handlers will additionally receive a 50 per cent rebate on licence fees payable for ground handling and catering services at the two airports.

The cargo sector will also get a 20 per cent rebate on rental paid by cargo agents tenanted in Changi Airfreight Centre.

Pilots, air traffic controllers and aircraft maintenance engineers will also get a full rebate on their licence and medical evaluation fees.

AVIATION SECTOR WELCOMES AID

Responding to the announcement, aviation companies welcomed the Government's measures to provide support amid the COVID-19 crisis.

The package will bolster Singapore Airlines Group's efforts to remain "nimble and flexible to seize all opportunities" as international travel resumes, said CEO Mr Goh Choon Phong.

"The foundations that we build during this crisis will put us in a strong position to overcome the current challenges and cement our leading position in a fast-changing aviation environment," he said.

READ: Singapore Airlines receives highest rating for 'hospital-grade' health and safety in global audit

The measures will enable Changi Airport Group to support jobs, strengthen the workforce's capabilities and pioneer new ways to deliver safe travel experiences, said CEO Mr Lee Seow Hiang.

"We foresee that air travel demand is unlikely to return to pre-COVID-19 levels in the near-term as countries around the world continue to maintain tight border controls," he said.

"Under such circumstance, the Government's OneAviation Support Package for Budget 2021 will certainly provide greater financial relief ... as we strive to preserve Singapore's competitiveness as an air hub."

Commenting on the package, Transport Minister Ong Ye Kung emphasised the importance of Singapore's air hub as the country's "lifeblood" connecting it with the rest of the world.

"Aviation is one of the hardest hit sectors during this pandemic, if not the hardest hit, as Changi and its stakeholders have lost 97.5 per cent of its customers," said Mr Ong.

"This support will help Changi tide through the crisis, while we explore ways to reopen borders safely."

Mr Ong added that he will speak more about support for the aviation sector during the Transport Ministry's Committee of Supply debate in Parliament.

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Source: CNA/dv(ta)

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