Bigger Baby Bonus and Medisave grant for children born on or after 1 January 2015

Measures aimed at making it easier for couples to look after their children and support them, says Grace Fu
By Charissa Yong, The Straits Times, 26 Aug 2015

The Baby Bonus cash gift for children of married couples will be increased by $2,000, bringing the amount they will receive to at least $8,000.

It will be given to parents in two stages: the first when the child is 15 months old, and the rest at 18 months.



The Medisave grant for a newborn will be raised as well, by $1,000 to a total of $4,000, which will help pay for the child's MediShield Life premiums and other medical expenses. The full grant will be given to all Singaporean babies, regardless of whether their parents are married.

These extras for Singaporean babies born on or after Jan 1 this year will be given out from next January.

These details were released by Minister in the Prime Minister's Office Grace Fu yesterday, after Prime Minister Lee Hsien Loong announced the measures on Sunday.

"The package is really to make it easier for couples to look after their children, support them on their journey," said Ms Fu, who oversees population issues.

Previously, the first two children of a married couple got $6,000 in cash each under the Baby Bonus scheme, while the third and fourth child received $8,000 each.

There was nothing in cash for the fifth and subsequent children.

So, depending on the birth order, married couples will get $8,000 or $10,000 per child in cash from the Baby Bonus scheme.

While the extra sum is handed out on the 15th and 18th month after the child's birth, the original cash bonus will still be given in the first, sixth and 12th month after the child is born.

"Many couples have said that expenses for their children are higher between the ages of zero and 18 months," said Ms Fu, explaining why the Government is spreading out the cash disbursement.

As for extending the cash bonus to unwed parents, she said it was "something we're always discussing with parents, the public and the Ministry of Social and Family Development, and we will always review this".

"But we also have to take cognisance that the values of family, of intact family, are very strong in the community. It's still a very important value for us to cherish and endorse, so this is where a distinction is probably still necessary," she added.

The new Medisave grant will be enough to pay the MediShield Life insurance premiums of the child until he or she reaches the age of 21, said Ms Fu.

Children born overseas can qualify for the grant on the registration of their birth with the Immigration and Checkpoints Authority, or through Singapore's overseas missions.

The extra $1,000 will be paid out from next March.

Until then, eligible children will continue to receive the existing $3,000 grant, which is given out in two instalments.

They will receive a one-off top-up of $1,000 next March.

Married fathers can also get an extra week of paternity leave, for a total of two weeks' leave.

It kicks in immediately for public servants, but is on a voluntary basis for the private sector.

Assistant marketing manager Yong Yong Kang, 26, whose daughter Gwyneth was born in April, welcomed the extra sums. "Monetary assistance from the Government can ease our expenditure on infant formula, infant care centres, diapers and medical care," he said, adding that he had recently paid $95 for a visit to a paediatrician.

He also welcomed the extra paternity leave, saying: "As a first-time dad, I'm always thinking about Gwyneth, so if possible, I want to spend more time with her."

Monetary assistance from the Government can ease our expenditure on infant formula, infant care centres, diapers and medical care.

Extra paternity leave may be mandatory in a few years' time

By Charissa Yong, The Straits Times, 26 Aug 2015

The newly announced extra week of paternity leave is voluntary for now, but may be made mandatory in a few years' time.

This will give companies struggling to cope with the labour crunch and economic restructuring time to adjust, said Minister in the Prime Minister's Office Grace Fu, who oversees population issues.

Before making the change mandatory, the Government "will discuss it first with employers and unions", she added.

Prime Minister Lee Hsien Loong announced on Sunday at the National Day Rally that paternity leave will be doubled and is backdated to take effect at the start of this year.

The Government will pay for the extra week of leave, he added.

Yesterday, Ms Fu said employers can apply for reimbursement from the Government from the middle of next year, capped at $2,500 per week.

The Government is encouraging bigger companies to take the lead in offering the extra week, and the public service has come on board.

The Public Service Division said that the public service, Singapore’s largest employer with 141,000 workers, recognised a father’s role in caring for and raising children and would take the lead in implementing the enhanced paternity leave.

The aim is to "set the tone in the employment market", Ms Fu said.

"The labour market is competitive, so if you want to attract better people and retain good staff, you'll have to follow this trend and offer as competitive (employment) packages as possible," she added.

The paternity leave can be taken by default as a two-week block within 16 weeks after the child's birth.

Alternatively, it can be taken any time within a year of the child's birth if agreed on by the employee and employer.

Working fathers are eligible for the extra paternity leave if their employers voluntarily provide the leave, and if they worked continuously for at least three months before the child was born. The father must also be married to the child's mother, and the child must be a Singapore citizen.

A National Population and Talent Division (NPTD) spokesman said more than 21,000 fathers have taken paternity leave as of May.

Paternity leave was introduced in May 2013. The NPTD said more than 40 per cent of fathers with children born that year took the leave.

The NPTD spokesman added that the take-up rate is in line with those of other countries, starting off lower but increasing gradually over time.

Said Ms Fu: "It would be nice to have a take-up rate of another 10 percentage points."

SMEs applaud changes but worry about rising costs
By Jacqueline Woo and Yvonne Lek, The Straits Times, 26 Aug 2015

Small and medium-sized enterprises (SMEs) here have voiced concerns abut costs climbing as a result of changes announced at the National Day Rally.

Prime Minister Lee Hsien Loong announced on Sunday that working fathers will receive an extra week of paternity leave, paid for by the Government, if employers opt in under the new scheme.

This means male employees will be eligible for a total of two weeks of paternity leave, instead of one.

Mr Lee also said the re-employment age will be raised from 65 to 67 by 2017.

Industry watchers and local businesses The Straits Times spoke to mostly gave the two changes the thumbs up, but also raised concerns about their implications.

Wages aside, SMEs will have to bear additional costs for their overall staff if they are to offer employees an extended period of paternity leave, noted Mr Kurt Wee, president of the Association of Small and Medium Enterprises.

These include the expense of hiring replacement workers in an environment where the cost of doing business is already "quite high".

"It's good that the scheme is voluntary for now, but we hope the Government will give this measure some serious consideration if it's going to be made mandatory in future," said Mr Wee.

Mr Victor Tay, chief operating officer of the Singapore Business Federation, said smaller-scale businesses, in particular, are "apprehensive of more absence of employees in an already resource-tight environment".

"Some entrepreneurs have pointed out that, with public holidays, personal leave and even national service, employees might be away for up to two months (in a year)."

Ms Stella Tan, human resource manager at food and beverage firm The Soup Spoon, said the move will help "create a happier workforce".

But rising costs continue to be a cause for worry for the company, which is "trying to stay lean" while coping with the chronic labour shortage across the sector.

Ms Connie Kwan, chief operating officer of home-grown chocolate manufacturer and wholesaler Aalst Chocolate, said: "If companies can get tax credits for paternity leave, this will make (the scheme) more attractive to them."

As for the higher re-employment age, Mr Tay said it is a "natural" move in an ageing society to retain the senior workforce, given the country's tight labour situation and limited resources.

"But it takes two hands to clap. Employers can offer re-employment but employees must want to work," he added, noting that most seniors tend to retire instead.

Mr Jerry Lim, chief operating officer of local restaurant chain JP Pepperdine, said: "If senior employees are competent and still able to work, there's no reason for us to not support them, especially in today's labour- starved market."

About 7 per cent of the company's 320-strong workforce are Singaporeans or permanent residents above 65 years of age.

"It also helps because they have knowledge and experience to pass down to younger staff," he said.



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