Building a Singapore Made For Families: Greater support for Singaporeans in starting and raising families
As announced by Deputy Prime Minister and Minister for Finance Lawrence Wong in the 2023 Budget Statement, the Government will enhance financial and parental leave measures for parents, to provide more support in the child’s early years. This is part of the Government’s efforts to strengthen support for Singaporeans who aspire to have children and raise a family.
Families with eligible Singaporean children born on or after 14 February 2023 will receive an increased Baby Bonus Cash Gift with longer payout period and higher Government contributions to the Child Development Account.
From 1 January 2024 onwards, parents can also enjoy enhanced parental leave provisions. Our tax benefits will also be adjusted to be given in a more progressive manner.
Increasing financial support in child’s early years
Parents of eligible Singaporean children born on or after 14 February 2023 will benefit from the following enhancements:
Increased Baby Bonus Cash Gift (BBCG).
The Government will increase the BBCG by $3,000 for children in all birth orders, and adjust the payout schedule to provide financial support on a regular basis every six months till the child turns six-and-a-half years. This way, parents can receive sustained support all the way till their child enters primary school. Currently, the BBCG is disbursed in five instalments over the first 18 months following the child’s birth, to help defray child-raising costs during infancy. Refer to Annex A – Table 1 for more details.
Higher Government’s contributions to Child Development Account (CDA).
The Government will enhance the CDA by increasing the (i) CDA First Step Grant by $2,000 for children in all birth orders, and (ii) co-matching cap by $1,000 for children in the first and second birth orders. Parents can use the CDA funds for approved areas of child-raising expenditure, which include healthcare and preschool fees. Refer to Annex A – Table 2 for more details.
As time is needed to effect changes to legislation, IT and payment systems, the increased financial support will be paid from early 2024, for eligible children who are born from 14 February 2023 onwards. Parents will automatically be notified when the enhanced BBCG and CDA First Step Grant are paid to them. However, the enhanced CDA co-matching cap will only be implemented from early 2024. For the rest of 2023, parents can save up to the current CDA co-matching caps. They will be notified on when they can make the additional deposits to save up to the enhanced CDA co-matching cap.
Depending on the birth order, each child will get $5,000 to $6,000 more in total Government contributions through both the BBCG and CDA. With these enhancements, parents will receive up to $24,000 in financial support for their first child, and up to $37,000 for subsequent children.1 Please refer to the summary table below on the enhanced Baby Bonus Scheme (comprising BBCG and CDA enhancements).
Extension of Baby Support Grant (BSG)
As part of this new package of measures, parents of babies born from 1 October 2022 to 13 February 2023 will also receive additional financial support. We will extend to this group the BSG of $3,000. The BSG was a one-off payment for eligible Singaporean children born from 1 October 2020 to 30 September 2022 during the COVID-19 pandemic, to encourage couples to proceed with their parenthood plans. Parents will be notified when the extended BSG is disbursed in the second half of 2023.
Helping parents to better manage work and caregiving commitments
Government-Paid Paternity Leave (GPPL) doubled. Currently, eligible working fathers of Singaporean children are entitled to two weeks of Government-Paid Paternity Leave (GPPL). We would like to encourage fathers to be more involved in child-raising and enable them to take on more parental responsibilities. The Government will double GPPL from two weeks to four weeks. These additional two weeks will be given on a voluntary basis, where employers who are ready to grant the additional leave will be reimbursed by the Government. We plan to make the additional two weeks mandatory in due course.
Self-employed persons who have been engaged in a particular business, trade, profession or vocation for a continuous period of at least three months before their child is born, are also eligible for the additional GPPL. This will apply to eligible parents of children born from 1 January 2024 onwards.
Unpaid Infant Care Leave (UICL) extended. Currently, each parent can take six days of Unpaid Infant Care Leave (UICL) per year in the child’s first two years. UICL will be extended by six days per parent per year, such that each parent can take a total of 12 days per year in the child’s first two years. Employers will have to grant all eligible parents of Singaporean children this additional time off if they have worked for their employers for a continuous period of at least three months.
This gives working parents the option and flexibility to take more time off from work to care for their child in the first two years. This will apply from 1 January 2024 onwards for eligible working parents with Singaporean children aged under two.
Taken together, these enhancements will increase parental leave for a working couple from 22 weeks to up to 26 weeks2 in their child’s first year.
Adjustments to tax reliefs
From the Year of Assessment (YA) 2025 onwards, these tax benefits will be adjusted: Working Mother’s Child Relief
The Working Mother’s Child Relief (WMCR) aims to encourage women to continue working after having Singaporean children. It will be changed from a percentage of the eligible mother’s earned income to a fixed dollar tax relief for qualifying Singaporean children born or adopted on or after 1 January 2024, with effect from the YA 2025. Eligible working mothers will be able to claim $8,000 annual relief for her first child, $10,000 for her second child, and $12,000 each for her third and subsequent child.
For eligible working mothers with qualifying Singaporean children born or adopted before 1 January 2024, there is no change to the WMCR that these mothers can claim in respect of these children. Eligible working mothers of these children will continue to claim the WMCR based on the existing design and quantum, which is based on a percentage of their earned income. Refer to Annex A – Table 3 for more details.
Foreign Domestic Worker Levy Tax Relief
The Foreign Domestic Worker Levy Tax Relief (FDWLR) was introduced in 1989 to support working married women who needed the help of a Migrant Domestic Worker, especially those with childcare needs. The amount of FDWLR is twice the total Migrant Domestic Worker levy paid in the year immediately preceding the YA of claim on one Migrant Domestic Worker.
To support working mothers, in particular those living with children below 16 years old, elderly or persons with disabilities who require domestic help, the Government introduced a concessionary levy of $60 per month (usual levy is $300 or $450 per month for the first and subsequent helper respectively). The concessionary levy benefits families who need caregiving help, including those who do not pay income tax.
As the concessionary levy is a more targeted and progressive way of supporting our families who need help with caring for their dependants, the FDWLR will therefore be lapsed from YA 2025 onwards. There is no change to the concessionary levy.
Supporting Singaporeans’ Marriage & Parenthood Aspirations
Since 2021, the National Population and Talent Division, Strategy Group, Prime Minister’s Office has engaged and surveyed close to 20,000 Singaporeans in different stages of their marriage and parenthood journey, including through the “Emerging Stronger Conversations – Building a Singapore that is Made For Families” and 2021 Marriage and Parenthood (M&P) Survey, to understand their concerns and views on M&P.
M&P aspirations remain strong among Singaporeans, but many married Singaporeans have fewer children than they prefer.3 The above enhanced measures will address key considerations for Singaporeans in making parenthood decisions, including the cost of raising a child – where parents have regularly highlighted that they would like more financial support, especially when their children are younger (ages 0-6), as well as the ability to manage work and family commitments.4
The Government is strongly committed to supporting Singaporeans who wish to get married and have children. We have continually invested significant resources and enhanced our support measures for every stage of the M&P journey. Beyond Government support, we also need a whole-of-society effort – from individuals and co-workers, to businesses, employers and community partners – to build a Singapore Made For Families. Details about our M&P support measures can be found at www.madeforfamilies.gov.sg.
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1 This comprises the Baby Bonus Scheme benefits and the MediSave Grant for Newborns.
2 The 26 weeks comprise 16 weeks of Maternity Leave, 4 weeks of Paternity Leave, ~2 weeks of Childcare Leave (six days per parent) and ~4 weeks of Unpaid Infant Care Leave (12 days per parent) in total for both parents.
3 According to the 2021 Marriage and Parenthood (M&P) Survey conducted by NPTD. The survey was conducted from February to June 2021. Respondents comprised 2,848 single (never-married) and 3,017 married Singapore residents, aged 21 to 45 years old.
4 This is based on NPTD’s survey of sentiments towards M&P benefits conducted in 2021, with 1,239 respondents at different stages of their parenthood journey. When asked which age range of their child they would like more financial support for, the majority of respondents said age 0-6.