By Kerrie Chang and Alison McNicholas
SINGAPORE — The Budget 2020 calls on the population and enterprises to partner the government to develop a strong and responsive economy with a capable and relevant workforce.
To help businesses and individuals strengthen their capabilities, the one-off SkillsFuture Enterprise Credit of S$10,000 to eligible employers will support companies in their transformation programs, with S$3,000 of the credit reserved specifically for workforce transformation programmes. These programmes include Skills Framework-aligned courses, professional conversion programmes and job redesign initiatives.
For individuals, Singaporeans aged 25 and above will receive S$500 SkillsFuture credit top-up, while those aged between 40 and 60 years will receive an additional S$500 top-up. To encourage (and perhaps put some urgency to) individuals to leverage this current downtime by investing in themselves, the top-ups have an expiration deadline of five years.
Align SkillsFuture courses with employment
In his Budget speech, Deputy Prime Minister and Finance Minister Heng Swee Keat shared that five years after the launch of SkillsFuture, more than half a million people have used their SkillsFuture credits to pick up new skills and develop new interests.
SkillsFuture offers a diverse array of courses and individuals need not take on training related to their current jobs or industries to use the credit. Hence, it’s not unheard of for individuals to use the SkillsFuture credit to further their personal interests.
While there are merits to encourage individuals to take on hobbies and personal interests outside their work, the question is whether there is help available to help individuals pick courses that can enhance their career aspirations, develop relevant skills that are in demand, or even to pursue alternative career paths.
Hence, the announcement of the assembly of volunteer career advisors is a welcomed move. These career advisors will provide industry specific guidance on relevant courses to individuals and companies alike. This should help them better identify appropriate and complementary programmes under the available courses.
Consider enhancements to Course Fee Relief
To further encourage individuals to take ownership of their career development, it would have been good to see some adjustments made to the personal tax relief for course fees. In contrast to the SkillsFuture credit, the Course Fee tax relief currently available for taxpayers up to S$5,500, is available only for qualifying courses that result in approved qualifications, and deemed to be relevant to current employment.
Relaxing this requirement for the course to be related to the individual’s current employment would provide greater flexibility in undertaking courses to pursue employment in emerging industries, allowing an easier transition to new roles.
To ensure relevance, help by the volunteer career advisors can be used to identify and endorse courses within the industry, to help individuals to make use of the tax relief in a targeted way, without imposing limitations based on their current career path. Furthermore, acknowledging the increasing cost of vocational training through an increase in the relief cap from S$5,500 would have been welcomed.
Ultimately, Budget 2020 provides welcomed investments to strategically drive the development of the workforce and given the present downtime, there is no better time to do so. After all, any periods of business slowdown during these uncertain times can be seen as availing companies and people of time, which can be reinvested into transformation, training and upskilling to ready themselves for growth going forward.
Kerrie Chang is Partner, People Advisory Services at Ernst & Young Solutions LLP and Alison McNicholas is Manager, People Advisory Services at EY Corporate Advisors Pte. Ltd.
The views reflected in this article are the views of the author and do not necessarily reflect the views of the global EY organisation or its member firms.