Solidarity Budget to cost S$5.1 billion, S$4 billion more needed from reserves

SINGAPORE: A third tranche of COVID-19 support measures that includes cash payouts and additional support for jobs will cost the Government S$5.1 billion, with S$4 billion to be drawn from Singapore’s reserves.

The additional measures – which include wage subsidies for every local worker, cash payouts for all adult citizens and more help for the self-employed – will take the Government’s combined COVID-19 support package to S$59.9 billion, said Deputy Prime Minister Heng Swee Keat on Monday as he announced the Solidarity Budget. This is about 12 per cent of Singapore’s gross domestic product.

Of the new package, S$4 billion will go to additional support for businesses and workers, and S$1.1 billion to the Solidarity Payment – payouts of S$600 for each adult Singaporean.

READ: Heng Swee Keat announces third round of COVID-19 support measures in new ‘Solidarity Budget’

This adds to the S$48.4 billion Resilience Budget unveiled on Mar 26 and the S$6.4 billion Unity Budget announced in February.

The overall budget deficit for FY2020 will increase to S$44.3 billion or 8.9 per cent of GDP, said Mr Heng, who is also the Finance Minister.

Earlier, President Halimah Yacob had given her in-principle support for the Government to draw up to S$17 billion from past reserves to fund some of the measures in the Resilience Budget.

READ: Solidarity Budget: Jobs support raised to 75% for April, payout brought forward

“With the significantly stricter pre-emptive measures needed to protect Singaporeans and our families, it is now necessary for us to propose a further draw on past reserves,” said Mr Heng.

The President has given in-principle support to draw on an additional S$4 billion from the reserves, he said.

“Specifically, this will be used to fund the enhanced Job Support Scheme, the enhanced Temporary Bridging Loan Programme and Enterprise Financing Scheme, and the Solidarity Payment to Singaporeans,” he said.

“This is an unprecedented budget, for extraordinary times. The situation remains highly fluid and uncertain. The Government stands ready to provide further support, should it become necessary,” he added.