SINGAPORE: Jobs was a key focus on Day One of the Budget debate. While many MPs applauded the Jobs Credit scheme as being innovative, tough questions were also raised about its costs and effectiveness in saving jobs.
Will the scheme save jobs because it reduces costs? Labour MPs like Madam Halimah Yacob believe it will.
She quoted a human resources manager who had been asked to look at trimming headcount. She said: "The Jobs Credit Scheme is a very good move for Singapore....as Thailand, China and the Philippines have all begun resources actions or are seriously considering them. This may not be a long—term solution but it helps to delay the actions at our site."
Other MPs said the scheme was too employer—oriented.
Lim Wee Kiak, MP for Sembawang GRC, said: "There is no guarantee that the water will reach them in time as some may be siphoned away by employers for personal gains rather than saving the business and saving jobs."
Hougang MP Low Thia Khiang raised concerns about the bluntness of the scheme, saying it puts money in the hands of companies which may still be profitable and have no retrenchment plans.
Instead, he favoured giving direct help to retrenched workers.
Mr Low’s comments led to a spirited exchange between him and a number of labour MPs.
Josephine Teo, MP for Bishan—Toa Payoh GRC and NTUC assistant secretary—general, said: "Sir, I’d like to ask the Member: Is he saying that because the Jobs Credit Scheme has not proven its effectiveness, it’s better for us not to have the Jobs Credit Scheme and forget all about it?"
Lim Swee Say, NTUC secretary—general and Minister in Prime Minister’s Office, said: "If the choice is between implementing a S$4.5 billion Jobs Credit versus a 9% cut in CPF, which one would the Workers’ Party go for? Which option?"
Replying, Mr Low said: "Our position is that we will never cut the CPF. But the question is: whether or not, must it be Jobs Credit? Could there be other forms available to cut costs? There may be other forms but to me, Jobs Credit, I look at it, I don’t think it’s effective."
Also questioning the long—term effectiveness of the scheme was Nominated MP Siew Kum Hong who said: "Businesses facing collapsed demand will still retrench. Businesses doing well will reap a windfall benefit. The question must be whether spending $4.5 billion on the Jobs Credit scheme produces the most bang for the buck for Singaporeans."
In the end, though, one thing all did agree on was that jobs for Singaporeans remain the most pressing concern, with MPs bringing up the need to do more for all those who, despite all these measures, have been retrenched and remain unemployed.
— CNA/ir
http://sg.news.yahoo.com/cna/20090203/t ... 1650b.html
Overview
The Jobs Credit Scheme was introduced in the Singapore Budget 2009 to encourage businesses to preserve jobs in the downturn. Businesses will receive a cash grant based on the CPF contributions they have made for their existing employees. It provides a significant incentive for businesses to retain existing workers, and where their business warrants, to employ new ones.
http://www.iras.gov.sg/irashome/jobscredit.aspx
I'm no economic expert, so I have to ask, is such a scheme able to retain jobs or will those business simply sit on the money once again?