MR CHRIS Koh, 55, is the secretary- general of the Textile and Fashion Federation and business director of garments manufacturer SL Ponie, a subsidiary of mainboard-listed Sing Lun Holdings. Companies like his are being squeezed by falling external demand, as they export mainly to the United States.

WHAT HE WANTS

'If companies are not making money, tax incentives will not be attractive. Therefore, where the Government can really help is in cutting business costs.

'One way would be for the Government to reduce the employer's contribution to the Central Provident Fund (CPF), as this would lighten the human resource cost load on employers.

'Another way would be for the Government to take the lead and say that any company affected should make use of the monthly variable wage component.

'Companies right now are reluctant to become the first to take action, as it will affect their employees' morale. So, I think there should be an announcement that companies should, for example, all cut the variable wage component by 5 per cent.

'For property owners, I would also like to see some help on rentals to cushion the costs for firms.'

WHAT EXPERTS SAY

Reducing business costs will top the agenda in the Budget, especially in the areas of wages and rentals.

Expect rental rebates, or even temporary rental exemptions, for all HDB and JTC commercial and industrial tenants, said DBS Bank economist Irvin Seah.

Port-related tariffs and foreign worker levies are also likely to be cut.

As for wages, the topic of employers' CPF contributions is still up in the air.

Even though Prime Minister Lee Hsien Loong has come out to say that these are unlikely to be cut as such a move will be 'too pessimistic a signal', some economists, such as Standard Chartered's Alvin Liew, are still predicting this step.

He expects the contribution rate to fall from 14.5 per cent to 10 per cent, the level it fell to during the Asian financial crisis. 'The immediate impact...will be significant wage bill savings for companies,' he said.

Other banks, such as UBS, suggest that the Government co-pay employers' CPF contributions for lower-end workers, rather than cut the actual rate.

ROBIN CHAN

This article was first published in The Straits Times on January 17, 2009.