SMALL and medium-sized enterprises (SMEs) will continue to be an important area of focus for the Government in the restructuring period, said Minister of State for Trade and Industry Teo Ser Luck.
He pledged to continue rolling out programmes to aid companies with the difficult restructuring process and said the Government will work with SMEs to improve existing ones.
"If you want to improve the efficiency and effectiveness of your business and want to implement methods of changing your processes, there will continue to be schemes to help," said Mr Teo.
He was speaking to The Straits Times after a dialogue about the Budget held on Friday with representatives from nine SMEs.
He said that participants at the session were receptive to schemes rolled out in the Budget, with most acknowledging that "it is an effort by the Government to help businesses".
The Wage Credit Scheme, in which the Government co-funds pay raises for Singaporeans over three years, was singled out as one of the most significant measures in aiding SMEs in their restructuring efforts.
"The main concern is cost - while the scheme will help defray costs, firms will have to figure out issues like when they can increase wages, and if their business is ready for it," said Mr Teo.
He said the Wage Credit Scheme is intended to help companies tie salary increases to productivity improvements.
"If there is no value-add, it's very difficult to justify that wage increase," he added.
Mr Teo said awareness and understanding of available schemes were lacking among SMEs, so the Government would continue to work at marketing them.
"Businesses need to transform to survive - different companies are at different stages, and it's not one size fits all... Businesses must be resourceful and willing to try," he said.
Ernst & Young said that the Wage Credit Scheme is a targeted measure to help businesses defray the cost of raising wages.
"This is a more direct approach to helping employers increase wages for Singaporean employees," it said in a report.
But it noted that the scheme uses gross wages, which may fluctuate as they include items such as commissions, overtime and bonuses.
"An employee who receives an increase in their monthly basic wage, but works less overtime or receives a lower annual bonus, may not receive an increase in gross monthly wage as defined for the purposes of the wage credit," the firm noted.