Is Jobs Credit being abused by some employers?
October 12th, 2009 | 
Author: From our Correspondent
In a dialogue session held yesterday with Minister in Prime Minister’s Office Mrs Lim Hwee Hua, freelance consultant William Swee claimed that an organisation which received Jobs Credit had laid off five employees, but gave increments to top management and later took in new recruits. He did not name the organisation.
Mrs Lim replied that the scheme is not being abused so long workers are retrenched as a result of business restructuring.
The $4.5billion scheme was introduced early this year to help employers hold on to workers during the global economic downturn by defraying their wage bills.
For every resident worker on their Central Provident Fund payrolls, bosses get 12per cent on the first $2,500 of the employee’s monthly wage.
The example mentioned by Mr Swee is unlikely to be an isolated case. “Business restructuring” is a very ambiguous term which can be easily exploited by unscrupulous employers to retrench workers.
The government claimed that the scheme had helped to keep Singapore’s unemployment rate to a minimum.
With no independent trade unions to represent their interests, Singapore workers are completely under the mercy of employers and the government.
The ruling party controls all the trade unions in Singapore via its proxy NTUC whose Secretary-General is always a PAP minister.
The PAP claims that this “tripartite arrangement” has allowed Singapore to maintain cordial industrial relations with the unions, employers and workers.
The salaries of the lower income group have stagnated for the last decade while the income gap between the rich and the poor continues to grow.
According to data from the World Bank, Singapore has one of the highest Gini Coefficients (an indicator of income gap) among the developed countries which is closer to third world countries like Kenya and Nigeria.
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15 Responses to “Is Jobs Credit being abused by some employers?”
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subsidies are always abused, so they should be scrapped to avoid distorting the market
Before one jumps to conclusion about the organization mentioned by William Swee, we need to get the facts right. We simply don’t have all the facts here.
For one thing, if the organization retrenched 5 foreign employees and hired Singaporeans, then it is good.
The way TR wrote this piece implies that the 5 retrenched are Singaporean/PRs, which is not proven.
I don’t mean to take sides or anything like that but I would like to see responsible and fair reporting from your correspondents, otherwise TR is no better than Shitty Times.
Businesses, if true to the stereotype – hate labor power and by extension unions.
We need businesses to relocate here to create jobs – unfortunately the tradeoff is usually a reduction in labor power(rights).
No government has been able to change this zero sum game to one where both labor and business can win, will our “best paid” talent be able to buck the trend?
If any should argue that productivity can improve our standards of living – that is certainly true, however the issue here is who benefits disproportionately from that increase in productivity, business(management usually and occasionally shareholders) or labor?
Lim Hwee Hua,
If you cannot answer these questions satisfactorily, then you are really no better than the US officials (which collect less pay than you BTW) who bungled the US bank bailout program, allowing top bank executives to reward themselves excessively with taxpayers’ money.
If you do not know how the money is used, how then do you measure if the Job Credit scheme is successful? Do you care about that?
I challenge you to release the following statistics. How much of the $4.5B has already been released in the following sectors
a) GLCs, b) MNCs and c) SMEs?
Lets not be petty about abuse or what not. So long as it benefits Singaporean and the money is flowing within the local economy, it does not matter.
We only worry of abuses by foreign folks who are taking our money away with them to other countries.
By being petty on these things make the government less willing to help local people when we actually really need it.
As Singaporean we stand shoulder to shoulder with one another.
“Mrs Lim replied that the scheme is not being abused so long workers are retrenched as a result of business restructuring”
LHH, how are you able to determine whether the business is undergoing restructing ? By what measure, pls elaborate.
My company is sacking the locals and hiring the cheaper foreigners, so does that constitute restructing ?
How did the minister explain the part on the company employing another group of 5 employees to replace the retrenched ones?
This is so blatantly wrong.
She doesn’t even assume that the employers could be abusing the system.
THE world the only government that fed the employer with taxpayer money.
WITH many many singaporean being left out the workforce, and replace with foreigners, are singapore need their own people.
They only grow fat and fatter with this kind of policy.
Singaporean did not benefit from this policy, only the big company gain more.
LEt the voters decide for the coming election.
It is money transfer from taxpayers to employment to DELAY RETRENCHMENT ( euphemistic preferred term in the MSM is called “restructuring”).Cutting costs is only part of restructuring but economic realities outside is to find new business opportunities and EMPLOYING NEW RESOURCES TO TARGET THESE OPPORTUNITIES. The “new opporunities” maybe nothing new – same customer base ON LOWER DEMAND but compete on price and costs to beat the next competitor. So subtitute “expensive” labour with cheaper sourcing, most likely foreign workers – so every employer does the same to survive tommorrow.
The end result is still retrenchment. Job Credit is just a hoax of political ploy to no real good effective well-thought out outcome.It is typical of this Government way of solving problem, just throw money at the problem and see if something works. And it doesn’t. LTK voiced his concerns in Parliament but PAP members took no heed.
So what now? Throw more money blindly for another six months to placate lesser retrenchment while the election is waiting? And when stimulus package is withdrawn globally and economy tank again, more retrenchment will come and then what???
It should have been a conditional grant that REPAYMENT IS NECESSARY AT FUTURE DATE OF RETURNED PROFITABILITY so there is real pressure on employer to RESTRUCTURE THE BUSINESS to good business outcome of longer beneficial effects, NOT RESTRUCTURING THE EMPLOYEE ALONE just to survive tommorrow.
BIG BAD ECONOMIC MISMANAGEMENT AGAIN!
In a recession, if the government’s aid is really meant to help workers, the money should go to them who in turn would spend the money to generate income to benefit the economy.
Instead, the bosses get the subsidy who in turn would pocket the lump sum into his already fat pocket. He is very unlikely to spend the money, but instead hoard the money in some bank account.
It’s one of the PAP’s government aim to hit at the working class and line the pockets of the bosses who give money to support the PAP
Hi Aspen,
I agree with you on the viewpoint on fair and balanced reporting but for internet news, there is always an option of a right-to-reply to clarify any misrepresentation of facts, but there is no such option for the Shitty Times.
While the essence of the dialogue has not sunk in yet, I believe that the Jobs Credit scheme has been extended. What irritates me is that on the pretense of the dialogue, you raise hopes that things will be discussed in the open. Oftentimes, the attendees and the issues are brushed away, like dandruff off their shoulders, in disdain.
All in, its a harebrain scheme, and abuse is unavoidable. Be mindful of the fact is that taxpayers money are spent, 4.5 billion with out a cent being accountable for except that, well, it has been disbursed and on record its a success.
looks like election will be due before June 2010, judging by the fact that jobs credit is extended to that month.
it will be like the germans who also retrench more after their elections
“The end result is still retrenchment. Job Credit is just a hoax of political ploy to no real good effective well-thought out outcome.It is typical of this Government way of solving problem, just throw money at the problem and see if something works. And it doesn’t. LTK voiced his concerns in Parliament but PAP members took no heed.”
Agree with you totally. Has job credit benefit workers in the past 9 months? Maybe marginally. Foreigners preferred over locals; younger generation preferred over aged Singaporean. Even if we don’t implement the jobs credit, companies will still need to hire workers to work.
LTK argued from the start that JCS is only a short term solution. Why it take 9 months for this world crass government to find out? The problem they need to tackle is economic restructuring, rather than fattening the coffers of the companies.
Based on the arrogance of those MIWs, they will just brush people off when they had better ideas. Since MIW are elites and being paid the highest in the world, they cannot accept when someone who have a more brilliant than them. Pride Issue.
I’m not sure I understand how the Jobs Credit is being abused by the employer mentioned in the first paragraph. Can anyone explain it in simpler terms?