NDR 2026: Businesses welcome government move to cover childcare leave costs, but manpower concerns remain
Some employers warn that replacing absent staff members remains difficult, especially for small firms.
People walk on the street during lunch break at Raffles Place in Singapore on Jan 22, 2025. (File photo: AFP/Roslan Rahman)
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SINGAPORE: Businesses have welcomed the government’s move to fully cover childcare leave costs, though some point to lingering questions over how to plug staffing gaps during absences.
“While it will undoubtedly impact the company, I truly believe the merits will offset any gaps that the company might face. With advance planning of workflows and empathy between departments, gaps can be covered,” said Mr Leon Lai, CEO of communications firm Betterment Group and a father of two.
Others are less convinced the financial relief solves the underlying problem.
“On the surface, it looks like the cost burden is taken away. However, the actual person has also been taken away,” said Mr Ronald Soh, managing director and founder of tech company Win-Pro Consultancy.
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“So that creates an impact on us as well, because SMEs are very lean and they work very tight.”
Prime Minister Lawrence Wong announced in his National Day Rally speech on Sunday (Aug 23) that parents will get more childcare leave, with the government fully reimbursing employers’ costs for statutory child-related leave schemes, up to a limit. Currently, these costs are shared between the government and employers.
Under the enhanced scheme, each parent will get eight to 12 days of leave a year, depending on the number of Singaporean children under 12 years old they have. This is up from six days a year for parents with children aged six and below, or two days a year for those with children aged seven to 12.
Mr Julius Holmefjord-Sarabi, co-founder of music school Aureus Academy, said the enhanced leave reflects a broader push to support families.
“It’s good for Singapore to be really focusing and emphasising family and childcare, because it can be quite challenging to raise kids with the costs and the challenges in Singapore,” he said.
“I would say we’re well-positioned to handle a change like this because of our curriculum and the way that we run our company. I can imagine there will be a lot of challenges for small businesses and businesses in general to adapt. But I don’t see them being insurmountable.”
The Singapore National Employers Federation (SNEF) called the government’s move a significant commitment towards supporting both employers and families.
The reimbursement for leave costs will give employers more flexibility in supporting employees with caregiving responsibilities, said CEO Hao Shuo.
“The enhanced reimbursement support can also help employers adopt measures to address operational challenges arising from staff absences, including engaging temporary manpower where appropriate,” he added.
BURDEN ON SMALLER BUSINESSES
Mr Josiah Tan, co-founder of soup store OMMA Chicken Soup, said it would have posed a “significant problem” for his business had the government not picked up the full costs.
He added that for businesses in the F&B sector, there is no option for remote work, with employers needing to search for replacements.
“The root problem is that someone is missing, but the job still needs to be done. (The question is) how can we still get the job done while the person is gone,” he said.
Mr Hao acknowledged that some employers will be concerned by the changes.
“But if you look across the workplace, unless you are an employer with a high percentage of employees who have caregiving needs, I would say it is probably more manageable,” he said.
“I do recognise there are employers who have quite a number of employees in that age range and therefore have to make new provisions for their employees’ childcare leave. For such employers, some additional support, for example temporary manpower services, may be needed.”
Aureus, which has about 750 employees, is well-positioned to handle the change, Mr Holmefjord-Sarabi said, though challenges remain, such as finding replacement teachers or managing customers who want continuity in who teaches their children.
“At the end of the day, we feel like overall it’s still manageable, it’s still workable,” he added. “Depending on which team in our company, and which sector an individual or company is in, it will have different challenges that they have to work with.”
Source: CNA/mt(cy)
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