Annual Workfare payouts for lower-income workers to hit over $1b by 2020

It will benefit about 440,000 Singaporeans.

The government will disburse over $1b of annual Workfare payouts by 2020 amidst enhancements in the Workfare Income Supplement (WIS) Scheme, minister of state for manpower Zaqy Mohamad revealed. The scheme is a measure to aid lower-income workers and help them save for retirement through salary top ups.

Finance minister Heng Swee Keat previously said in his Budget speech that starting 2020, Workfare will raise the qualifying income cap from $2,000 to $2,300 per month. Moreover, it will also increase the maximum annual payouts by up to $400.

According to the senior state minister, the enhancements will reach about 440,000 Singaporeans, including self-employed persons.

“I understand members’ desire to look after the workers’ immediate needs. From 2020, the enhanced Workfare payouts will give all workers higher cash payments for daily needs,” Mohamad explained, noting that other extra bonuses such as the Workfare Bicentennial Bonus are generally paid in cash fully.

As the scheme targets to aid workers for retirement, Mohamad noted that MP Zainal Sapari has proposed to increase the cash component from 40% to 80% and decrease the Central Provident Fund (CPF) component from 60% to 20%.

“We also want our lower-income workers to benefit from the higher interest earned in CPF. Compounded over time, the savings will help them have more in retirement,” Mohamad said, adding that they will continue to review the Workfare regularly.

Photo from minister of state for manpower Zaqy Mohamad's Facebook page.