Singapore to defer levy increase of foreign workers in 2015

Singapore's Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam said in parliament Monday that the government will defer this year's round of announced levy increases for S Pass and Work Permit Holders.

These are two kinds of work permits issued to foreign employees in Singapore in every sector, given the obvious slow-down in foreign workforce growth.

Shanmugaratnam made such remarks when delivering the budget speech for the fiscal year 2015 (FY2015).

Singapore has been tightening its foreign worker policies since 2010 as a way to promote productivity and economic restructuring. Statistics show that the net inflow of foreign workers, excluding construction sector, has slowed significantly from 60,000 in 2011 to just over 16,000 in 2014 (excluding foreign domestic workers). And in the Construction sector, which hires the largest population of foreign workers, the growth was around 10,000 in 2014, far below that recorded in the previous two years.

Shanmugaratnam said the significant slowdown in recent years gives the government space to adjust the pace of tightening measures. However, he stressed that the government is "not changing direction".

"Our basic approach remains unchanged. We have to stay the course in reducing reliance on labour and especially unskilled foreign workers. However, we will continue to calibrate our foreign worker policies as informed by evidence on the pace of inflows, the quality of workers being employed, and the progress being made in raising productivity," He said.

The adjustments in foreign worker policies are part of the effort to continue pushing forward the restructuring of Singapore' s economy in the new budget. Other key points include: investing in skills of the future, promoting innovation and internationalisation among businesses as well as strengthening assurance in retirement and enhancing support middle-income families.

Shanmugaratnam said the Budget 2015 aims to make "fundamental policy shifts to give Singaporeans greater assurance at each stage of life, more opportunities, and a better home for all."

"This Budget is focused on building Singapore's future. We must reach our next frontier as an economy, with firms driven by innovation, and higher incomes coming from deep skills and expertise in every job. We must ensure a society that is fair and just, where everyone has a chance to move up and do well regardless of where they start. And we must complement a culture of personal effort and responsibility with stronger collective responsibility, especially for our elderly." Endi