Monday, February 24, 2014

Direct Benefits for Households in Budget 2014

I am only highlighting some of the more direct benefits (non-business related) to households. Looking at the benefits to businesses, it's similar to last year, where they are providing productivity packages to the companies in order to encourage them to increase their productivity. In addition, they are also encouraging startup enterprises and increasing medisave CPF contributions to fund the Medishield Life that will be introduced soon.

The benefits in this budget again does nothing in enhancing work-life balance for all Singaporeans. All the benefits are mostly in monetary terms. Looking at year 2013, productivity was similar to 2012, which either proves that the productivity drive is working, or the bosses are asking the current staff to take on the extra workload with no extra pay. Maybe there should be some assurance that the productivity drive is not at the expense of current workers.

Anyway, below are some of the more direct benefits to households:
  1. Provide more fee assistance through the Kindergarten Fee Assistance Scheme (KiFAS) to lower-income families, and extend support to middle-income families and make available KiFAS to all Anchor Operators and MOE kindergartens.
  2. Significantly increase university, polytechnic and ITE bursaries and raise the per capita monthly household income threshold for bursaries from $1,700 to $1,900 from Academic Year 2014. This will benefit the two-thirds of all Singaporean households.

  3. Provide permanent subsidies for lower- and middle-income groups so that they can fully pay their remaining premiums out of regular Medisave contributions, and also provide subsidies to offset premium increases for the first few years to ease the transition into MediShield Life.

  4. The subsidies for Specialist Outpatient Clinics (SOC) services for lower- and middle-income Singaporeans, currently at 50%, will be increased to 70% and 60% respectively. This will be implemented from September 2014.
  5. To help Singaporean workers save for their healthcare needs, the employer CPF contribution rate will be increased by 1 percentage point for all workers. This increase will be channelled into the Medisave Account.

  6. Elderly Singaporeans will be allowed to use a portion of their Medisave more flexibly across a range of outpatient treatment, on top of the existing Medisave withdrawal limits for specific chronic conditions and other treatments.

  7. The Pioneer Generation will receive further subsidies for outpatient care in polyclinics, SOCs and General Practitioner clinics on the Community Health Assist Scheme (CHAS); A further 50% discount off their subsidised bills at SOCs and polyclinics; All in the Pioneer Generation will be placed on CHAS, regardless of income or housing type;Members of the Pioneer Generation who have moderate to severe functional disabilities will receive cash assistance of $1,200 a year under the Pioneer Generation Disability Assistance Scheme.

    The subsidies for SOC and polyclinic services, and Pioneer Generation Disability Assistance Scheme, will be implemented in September 2014. The additional CHAS benefits will be implemented in January 2015. More details will be provided at the Ministry of Health’s Committee of Supply. 
  8. The Government will provide annual Medisave Top-Ups of $200 to $800 for all in the Pioneer Generation, with higher amounts for older Pioneer Generation cohorts. It will be paid out from August 2014.

  9. To provide the Pioneer Generation with the assurance that their premiums will be affordable as they grow older, all Pioneer Generation members will enjoy subsidies starting from 40% at age 65, rising to 60% at age 90. This will be implemented at the end of 2015, when MediShield Life is rolled out.

  10. An $8 billion Pioneer Generation Fund will be set up to meet the full estimated cost of the Pioneer Generation Package over time.

  11. Singaporeans who were born on or before 31 Dec 1959 (i.e. aged 55 and above in 2014) and who do not enjoy Pioneer Generation benefits will receive an annual Medisave top-up of $100 to $200 over the next five years. The amount an eligible Singaporean will receive is based on the value of his/her home and will be paid out from August 2014:

  12. To boost the retirement adequacy of older Singaporeans, the Government will raise their CPF contribution rates effective Jan 2015. These are on top of the increase in employer CPF contribution rates for the Medisave Account for all workers. All increases in employer contributions will be allocated to the Special Account. The 0.5 percentage point increase in contribution rate from employees aged 50 to 55 years will go to the Ordinary Account.

  13. To give greater encouragement and recognition to individuals supporting their parents, grandparents, and great-grandparents (including in-laws), the Parent Relief and Handicapped Parent Relief will be enhanced as follows:

    The apportionment of the Parent Relief and Handicapped Parent Relief will be effective from Year of Assessment (YA) 2015.

  14. Subsidies for the Early Intervention Programme for Infants and Children (EIPIC) will be enhanced. Raise the universal base subsidy for Singaporean children enrolled in EIPIC from $300 to $500 a month; Extend subsidies to cover 80% of households. Those earning above the median income will benefit from a further 20% to 50% subsidy, in addition to an enhanced $500 base subsidy.
  15. To make transport more affordable for the disabled community, the Government will introduce: Subsidies to cover up to 80% of the cost of dedicated transport to access school and care services. This will apply to the lower two-thirds of households; A new Taxi Subsidy Scheme to subsidise up to 50% of the cost of taxi travel for those who are unable to travel by public transport or tap on dedicated transport. This will apply to the lower half of households.
  16. To provide greater support for individuals with handicapped dependants, the amount of handicapped spouse relief, handicapped sibling relief and handicapped child relief will be increased by $2,000 with effect from YA 2015 as follows:

  17. To help seniors with their cost of living, the Government will provide a one-off GSTV – Cash: Seniors’ Bonus for all eligible Singaporeans aged 55 and above. This means that they will get double the GSTV – Cash payment in 2014. About 675,000 seniors will benefit.

  18. To help households with their cost of living, the Government will provide a one-off GSTV – U-Save Special Payment, with those in smaller flats receiving more. It will be paid out on top of the regular GSTV – U-Save payments. About 800,000 households will benefit.

  19. To help households with their general household expenses, the Government will provide S&CC rebates in 2014. About 800,000 households will benefit.

For more information on the budget 2014, you can visit the budget website here.

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