Budget 2023: Up to S$400 cash for eligible Singaporeans, more CDC vouchers to allay cost-of-living concerns
All Singaporean households will also get a total of S$300 in CDC vouchers next year.
SINGAPORE: The Government will hand out a one-time "cost-of-living special payment" and another S$300 in Community Development Council (CDC) vouchers to allay inflation concerns.
These were among a suite of support measures that Deputy Prime Minister Lawrence Wong announced in his Budget speech on Tuesday (Feb 14).
The cost-of-living special payment will be given to eligible Singaporeans who are 21 and above this year, have annual assessable income below S$100,000 and do not own more than one property.
People who earn up to S$22,000 a year will receive S$400, those earning more than S$22,000 and up to S$34,000 will get S$300, and those earning more than S$34,000 and up to S$100,000 will receive S$200.
The payment, made under the Assurance Package, will be disbursed in June to about 2.5 million adult Singaporeans, said the Ministry of Finance.
All Singaporean households will also get another S$300 in CDC vouchers in January 2024. They can be used at participating heartland merchants and hawkers, as well as participating supermarkets.
Announcing the measures, Mr Wong, who is also Finance Minister, said he recognised that many Singaporeans are still concerned about immediate cost-of-living issues.
Combined with the enhancements to the GST Voucher scheme and Assurance Package, the Government will have provided "comprehensive help" for the majority of Singaporean households in the Budget, he said.
He said that on average, for lower-income households, the support will "fully cover" increases in spending due to inflation and the higher Goods and Services Tax (GST) rate. For middle-income households, the support will "substantially cover" their increased spending.
MORE SUPPORT FOR SENIORS, FAMILIES WITH CHILDREN
Mr Wong also outlined other one-off support measures made under the Assurance Package.
A "cost-of-living seniors' bonus" of between S$200 and S$300 will be given to eligible Singaporeans aged 55 and above in June.
To be eligible, the seniors must have an annual assessable income of not more than S$34,000, live in a property with an annual value under S$21,000, and not own more than one property.
This will benefit about 850,000 Singaporeans and is in addition to the existing seniors' bonus under the Assurance Package, said MOF.
In addition, U-Save rebates will be doubled over the next three tranches of disbursement in April, July and October, to help offset the utilities expenses of households in Housing Board flats.
Together with the Assurance Package U-Save rebate disbursed in January, this will double the amount of regular U-Save rebates received in 2023.
Eligible households can expect to receive up to S$760 in U-Save rebates this year, said Mr Wong.
Households with children will also receive additional support. Each child aged six and below will get a S$400 top-up in their Child Development Account (CDA), while older children will receive a S$300 top-up in their Edusave or Post-Secondary Education account.
To illustrate what the enhanced support means, Mr Wong said that a lower-income family with two young children will receive about S$5,500 in benefits, comprising cash, top-ups to the CDA and MediSave, U-Save and service and conservancy charges rebates, and CDC vouchers.
"And we have ensured that larger households, particularly those with seniors and children staying together, will receive more support. For example, a six-person middle-income household with two seniors and two school-going children will receive about S$8,400 in benefits this year," he said.
Taken together, enhancements to the Assurance Package will cost S$3 billion, raising government expenditure on the package from S$6.6 billion to S$9.6 billion.
NOT SUSTAINABLE TO RELY HEAVILY ON GOVERNMENT
Mr Wong said the enhancements to the Assurance Package reflected the Government's commitment to help Singaporeans through a challenging period of higher prices.
"But I hope all Singaporeans understand that it is not fiscally sustainable to rely so heavily on Government support year after year to cope with inflation," he said.
Mr Wong said that even after the current inflation surge moderates, inflation may stabilise at a higher trend level than in the last few decades, both globally and in Singapore.
"The era of untrammelled globalisation that kept goods at highly competitive prices all over the world is over," he said.
"Countries are now relooking and adjusting their supply chains. Instead of buying from the cheapest, they are prepared to accept lower efficiency and higher costs to prioritise diversification and strategic resilience."
He added that these trends were pushing up inflation everywhere, including Singapore, and that the country did not have much influence over the global inflation picture.
"But our best strategy to cope with inflation is to make ourselves more productive and competitive - so that our workers earn more, and the increase in earnings can more than make up for the higher prices."
Mr Wong noted that this was what had happened last year, with real incomes growing 2 per cent for the median worker, and 4.7 per cent for a worker in the 20th percentile.
"So despite higher prices, we are still better off in real terms."
He also stressed the importance of pressing on with economic restructuring and transformation, helping businesses to raise productivity, and helping workers upgrade their skills.