INTRODUCTION

Singapore’s Budget 2024 was introduced at a time of significant global economic turbulence, aiming to provide a blueprint for the city-state’s prosperity. The budget aims to navigate the balance between fostering economic growth and addressing immediate societal needs amid global uncertainties. This article takes a closer look at the budget’s implications, especially for the Malay Muslim community, and evaluates its potential to address both current and future challenges.

A CLOSER LOOK AT EMPLOYMENT OPPORTUNITIES

The Malay community in Singapore has seen a 70% rise in professional, managerial, executive, and technical (PMET) roles from 2010¹ to 2020², signalling a stride towards job equity. Yet, the community finds less representation in finance and high-tier professional jobs³, signalling entrenched hurdles that demand attention. Direct initiatives are vital to pry open these profitable sectors and allow Malays to have fair chances to advance in their careers.

In-Depth Analysis of Employment Measures and Their Implications

1. Temporary Support Scheme for the Involuntarily Unemployed

This programme is a key support for people who are temporarily out of work, giving them the financial help they need while they find a new job or get more training. The government has yet to release full details of this plan. We remain optimistic that it could significantly aid the Malay community, offering a safety net in challenging periods and ensuring that short-term hurdles don’t hinder their long-term economic progress.

2. Increase in the Local Qualifying Salary (LQS)

The increase in the LQS from $1,400 to $1,600, accompanied by the introduction of a new minimum hourly rate of $10.50, directly impacts the earning potential of lower-wage workers. The Progressive Wage Credit Scheme’s augmented co-funding levels and raised wage ceiling to $3,000 by 2025 serve to incentivise employers to pay higher wages. For the Malay community, this measure could narrow the income disparity gap, particularly for those employed in sectors with lower wages.

3. Expansion of the Workfare Income Supplement Scheme (WIS)

Raising the income ceiling for the Workfare Income Supplement (WIS) to $3,000 and the maximum Workfare payouts to $4,900 a year is a substantial move to improve the financial stability of those earning lower wages. For the Malay community, this increase means more support on top of their regular earnings, helping to close the gap in economic disparity. This boost in take-home pay is key to improving living standards for those in the community who need it most.

Implications for the Malay Community

The collective impact of these measures on the Malay community is multifaceted. Firstly, they represent a targeted approach to mitigating the risks associated with economic transitions and the vulnerabilities of low-wage employment. By ensuring that the community’s workers are supported through periods of unemployment, receive fair wages, and benefit from enhanced income supplements, these measures collectively contribute to a more stable and secure economic foundation for the community.

These initiatives align with the broader objectives of empowering Malay families by strengthening their financial stability. This empowerment is not just about providing immediate relief but about fostering a sustainable environment where the community can thrive economically. The focus on upskilling and fair wages addresses the root causes of economic disparity, laying the groundwork for long-term prosperity.

While these measures are commendable for their intent and potential impact, their success hinges on effective implementation and accessibility for those within the Malay community. Ensuring that these programmes are widely known, easily accessible, and tailored to meet the community’s unique needs will be crucial in maximising their benefit and truly bridging the inequality divide in Singapore’s evolving economic landscape.

SENIOR ASSISTANCE: BEYOND FINANCIAL AID

Singapore’s proportion of citizen population aged 65 and above is rising, and at a faster pace compared to the last decade, making senior assistance a key priority for the government.

The Singapore Budget 2024 has targeted programmes aimed at supporting the aging population, particularly addressing the needs of Malay Muslim seniors. These initiatives reflect a holistic approach to enhancing the well-being and financial stability of seniors, ensuring they can lead dignified and fulfilling lives in their golden years.

Key Senior Assistance Programmes and Their Implications

1. Enhanced Retirement Scheme (ERS)

 The Enhanced Retirement Scheme encourages seniors to make additional deposits into their CPF Retirement Accounts, aiming to secure higher payouts upon retirement. This initiative directly benefits Malay Muslim seniors by providing them with an avenue to bolster their financial security during retirement. However, for this scheme to be fully effective, there must be a concerted effort to raise awareness and under- standing of its benefits within the community. Tailored financial literacy programmes could play a significant role in achieving this, ensuring that seniors are well-informed and able to make decisions that maximise their retirement savings.

2.    Active Ageing Centres and Assisted Living Options

 The budget also allocates resources towards expanding the network of Active Ageing Centres and developing more assisted living options. These resources are aimed at meeting the diverse needs of Singapore’s ageing society, including the Malay Muslim seniors. Active Ageing Centres serve as community hubs where seniors can engage in social, recreational, and health-promoting activities, fostering a sense of community and well-being. Assisted living options offer an alternative living arrangement, providing seniors with care services while allowing them to maintain their independence. For the Malay Muslim community, these facilities must be culturally sensitive and cater to their specific needs, ensuring inclusivity and accessibility.

3. Silver Support Scheme & Matched Retirement Savings Scheme

The Silver Support Scheme aims to supplement the incomes of lower- income seniors, enhancing their financial resilience. The Matched Retirement Savings Scheme, on the other hand, matches dollar-for-dollar cash top-ups to seniors’ CPF accounts, encouraging personal savings and contributions from family members. These programmes collectively offer a safety net for Malay Muslim seniors, particularly those with limited financial resources. By easing the financial burdens associated with healthcare and daily living expenses, these schemes contribute to a more secure and comfortable retirement for the community’s elders.

Broader Implications for the Malay Muslim Community

The integration of these senior assistance programmes within Singapore’s Budget 2024 highlights a commitment to supporting the elderly, recognising the importance of a comprehensive support system that addresses financial, social, and health-related needs. For the Malay Muslim community, these programmes provide direct financial assistance and foster an environment where seniors can lead active, engaged, and independent lives.

Ensuring that these initiatives are effectively communicated and accessible to Malay Muslim seniors is paramount. Community outreach and engagement efforts, possibly through mosques and community centres, could significantly increase the uptake and impact of these programmes. Moreover, feedback mechanisms involving the community could inform ongoing improvements, making these initiatives more responsive to the seniors’ evolving needs.

While the budget lays a strong foundation for senior assistance, its success for the Malay Muslim community will depend on tailored approaches that consider cultural sensitivities, enhanced awareness campaigns, and easy access to these programmes. Through these concerted efforts, the budget can truly fulfil its promise of supporting all seniors in Singapore, ensuring they enjoy a secure, dignified, and fulfilling retirement.

HOUSING AFFORDABILITY AND COST OF LIVING: ADDRESSING CORE ISSUES

Singapore’s housing affordability issue, as indicated by the rising HDB resale price index and escalating costs of BTO properties presents a challenge, particularly for lower-income families, including those within the Malay Muslim community. While the budget’s introduction of short-term reliefs, such as financial assistance and housing grants, provides immediate support, these measures serve as temporary fixes to a complex issue that requires a more holistic and sustainable approach. Amidst the rising costs, households in the first decile (or those earning the least) had their incomes drop by 1.7% On the other end of the spectrum, in the ninth decile, the decline was 0.2% and for the 10th decile, it was 1.9%.

This issue is compounded by the fact that the estimated median income per household member for Malays is less than half of that for the Chinese population.

Key Interventions to Address the Cost of Living and Their Implications:

Assurance Package

This package provides more support for lower-income families and larger households to deal with inflation through payouts, vouchers, and rebates.

The Assurance Package is particularly pertinent for the Malay Muslim community, which includes a proportion of larger households that might feel the brunt of inflation more acutely. The direct financial support through this package can alleviate some immediate pressures. However, to enhance social mobility, initiatives must be paired with long-term strategies such as educational improvements, access to better-paying jobs, and financial literacy programmes tailored for the community.

PPHS (Open Market) Voucher

This offers one-year support for eligible families to rent an HDB flat in the open market.

The long waiting times for BTO flats disproportionately affect young families, who may struggle with housing costs in the interim. The Parenthood Provisional Housing Scheme (PPHS) voucher is a significant aid for these families, including those in the Malay Muslim community. The measure can provide breathing space, allowing families to maintain stable living conditions while waiting for their permanent homes. It also represents an acknowledgement of the diverse needs within the housing system, accommodating those who may not immediately fit into the standard BTO timeline.

New Income Tax Policies

These policies involve raising the dependant’s or caregiver’s income threshold for dependant-related reliefs to $8,000.

This policy adjustment can lead to tax savings for more families, thus increasing their disposable income. For the Malay Muslim community, which may have higher instances of multigenerational caregiving, this policy could be especially beneficial. It acknowledges the financial implications of caregiving and provides much-needed relief, which can have a knock-on effect on a family’s ability to support educational and health-related expenses.

In addressing the rising cost of living, while the government’s measures are a commendable attempt to provide short-term relief, the broader implications for the Malay Muslim community should encourage a focus on systemic changes that promote long-term economic stability and social mobility. This would involve educational programmes, job upskilling initiatives, and continued dialogue with community leaders to ensure these measures are effectively meeting the unique needs of the community.

ENHANCING EDUCATION OPPORTUNITIES: BRIDGING GAPS

The budget’s emphasis on education, with financial top-ups and SkillsFuture credits, shows a commitment to bridging educational disparities. However, the Malay community’s lower progression rates in ITE and university education underline the necessity for targeted support. This situation calls for an integrated approach that addresses financial barriers and tackles systemic and social hurdles to educational achievement. Community support initiatives that build social capital are essential to ensure equitable educational opportunities and outcomes. For this reason, more efforts to develop the social capital of the Malay community to complement their education are needed.

1. Assisting ITE Graduates

To assist ITE graduates, there will be a $5,000 top-up in their Post-Secondary Education Account (PSEA) when they enrol, and then a $10,000 top-up in their CPF Ordinary Account (OA) after completing their diploma. This measure will benefit the Malay community since if there is a higher proportion of Malays in the Normal (Technical) [NT] stream, it is likely that this overrepresentation extends to ITE. The government top-up will provide them with enhanced educational opportunities for skill development, which is crucial for long-term financial stability, including home ownership and retirement savings.

While this measure suggests concern over the low progression rates from ITE to Polytechnics, it may not be addressing the core reasons why students are not advancing their educational journey, as there are several factors that shape their decisions. A deeper investigation is needed to determine the barriers to further education for ITE graduates – whether they are financial, motivational, or due to systemic educational constraints.

 2. Promoting Lifelong Learning

To promote lifelong learning, the government will be introducing new top-ups and subsidies. Singaporeans aged 40 and above will receive a $4,000 SkillsFuture Credit top-up, with the existing $500 credit being expanded for a broad range of courses to promote lifelong learning. From 2025, individuals over 40 will have more opportunities to reskill by pursuing full-time diplomas at institutes of higher learning (IHL) through subsidies. In addition to this, there will be a training allowance for those over 40 enrolling in selected full-time courses, amounting to 50% of their average income from the past 12 months.

While these measures will assist those who are unemployed or wish to upskill and upgrade themselves, the low rates of Singaporeans using their SkillsFuture credits (shown in the chart above) indicate that more must be done to encourage its usage. A study conducted by MENDAKI shows that among the working population in the Malay community, 75 per cent of them are keen to continue looking at reskilling and upgrading. However, there are other factors that are dependent on this, such as employer’s support for them to go for upskilling⁵.

COMLINK+ PROGRAMME: HELPING LOW-INCOME FAMILIES

With the new measures that will be rolled out under the ComLink+ Programme, the Budget extensively addresses the problems low-income families face, primarily CPF contribution, Debt Repayment, and Preschool Education.

Key Interventions and Their Implications:

CPF Contribution

Regarding CPF contribution, it has been identified that many low-income families take up jobs in the gig economy such as delivery drivers, instead of full-time jobs⁶. Though it comes with flexibility and immediate payment, this means that they do not have automatic monthly CPF contributions. The Budget introduces new measures to attract low-income families to make voluntary CPF contributions or secure a CPF-paying job. Those who secure and sustain a CPF-paying job of ≥$1400 will receive  cash and CPF payouts for every quarter of employment. Those who remain in the gig economy are enticed to make voluntary CPF contributions as the government will make a 2:1 contribution.

Debt Repayment

In addressing the problem of low- income families struggling to pay off their debts, the government will make 1:1 matched debt repayment, up to $5,000. For low-income Malay-Muslim  families who are in debt, this allows them to pay off their debts and achieve stronger financial stability.

Preschool Education

In addition to more subsidies being extended to children with working mothers and non-working mothers in lower-income families, there will also be financial incentives to encourage consistent preschool attendance of their children.

There will be a one-off $500 top-up to the child’s Child Development Account (CDA) when enrolled in preschool (before he/she turns 3) and a $200 top-up to the child’s CDA for every quarter of good attendance (≥75% attendance). These efforts are targeted to encourage low-income families to enrol their children in preschools early.

While these are well-meaning initiatives, it remains to be seen if the new measures will be fully utilised by low-income families, as there are other factors that will influence their decision, such as the short-term need for cash.

TOWARDS A RESILIENT AND INCLUSIVE FUTURE

Singapore’s Budget 2024 is met with careful optimism, recognised for its commitment to helping those in need and investing in new technologies such as Artificial Intelligence. However, there are concerns that the government’s relief measures for the cost of living might be temporary, raising questions about whether they are timed for political gain rather than long-term economic stability.

The budget has drawn attention for not adequately addressing the financial challenges faced by Singapore’s under-40 singles, offering limited benefits like the Cost of Living (COL) voucher, tax rebates, and Medisave top-ups that may not meet their real-world needs. As we conclude, it’s clear the budget has its merits but requires a more incisive approach to truly serve every community, including the Malay population. By committing to inclusive growth and a carefully crafted strategy, Singapore can move towards a future that’s prosperous and equitable for all its people.

¹ Singapore Department of Statistics. (2010). _Census of Population 2010 Statistical Release 1: Demographic Characteristics, Education, Language and Religion. Retrieved from https://www.singstat.gov.sg/publications/cop2010/cop2010-sr1
² Singapore Department of Statistics. (2020). _Census of Population 2020 Statistical Release 1: Demographic Characteristics, Education, Language and Religion. Retrieved from
https://www.singstat.gov.sg/publications/reference/cop2020/cop2020-sr1
³ Ibid
⁴ The median income for Malay households in 2020 was $5,704. The estimated current median income for Malay households, given a similar growth rate as the general population, is ~$6,748. This is $4,120 less than the general population income (which is at $10,868). Given that the Malays have a household size of 3.7 individuals per household (based on the 2020 Census), the median income per household member is $1.823. This is about half (~48%) of the median income per household for the general population, which is at $3,500. A compound annual growth rate (CAGR) of 5.76% was used for the calculation.
⁵ Channel NewsAsia. (2024). SkillsFuture credit for workers to be doubled in Budget 2024. Retrieved from https://www.channelnewsasia.com/singapore/skillsfuture-credit-workers-budget-2024-courses-4131176
⁶ The Straits Times (2023). Giving low-income families and their kids a fighting chance to escape the poverty trap. Retrieved from
https://www.straitstimes.com/singapore/giving-low-income-families-and-their-kids-a-fighting-chance-to-escape-the-poverty-trap.

The Centre for Research on Islamic and Malay Affairs (RIMA), a research subsidiary of AMP Singapore, has developed a range of programmes in research and established several platforms for the meeting of minds. RIMA conducts research in a number of key areas, which includes economics, education, religion, family, social integration, leadership and civil society.