By LEE U-WEN

THE $4.5 billion Jobs Credit scheme must be made available to every single company, as granting it only to certain types of firms would be harmful to Singapore's image as a pro-business hub in the long term.

This was the view of Senior Minister of State for Trade and Industry S Iswaran, who drove home the point yesterday that the government wanted to be consistent across the board when introducing this innovative scheme to subsidise a portion of the employer's wage bill.

'If we start differentiating - especially towards the multinational companies which are a major player in our economy - then what you will get is that, today, they might say they will accept (our policy). But what about the next time, when they decide where to expand their operations further? They will remember the fact that this government did not take care of them when a downturn came,' he said.

Mr Iswaran was speaking at a Young NTUC Budget dialogue last night, which was attended by some 80 youths, mostly working adults in their 20s and 30s.

'In the short term, it might look good. But in the medium to long term, it will be harder for the government, harder for the Economic Development Board to attract companies to Singapore,' he said. 'It will be hard for us to convince them that we are their partners, in good times or bad. That is why we have decided to maintain the consistency.'

Mr Iswaran, together with NTUC assistant secretary-general Josephine Teo, fielded an array of questions from the young activists, on topics such as the pros and cons of a GST cut, help for SMEs, retraining for workers and unemployment benefits.

On the notion that a company would find it more cost-effective to retrench rather than receive Jobs Credit, Mr Iswaran described it as a 'convenient' solution that should be used only as a last resort.

'There are many things that can be done before a company should contemplate retrenchment. Yes, there will still be retrenchments, but let's not use it as an easy solution. We work together through the other more important measures, and then use it as a last resort,' he said.

One participant asked why Singapore did not consider a scheme recently implemented by Taiwan, where the government there handed out shopping vouchers of NT$3,600 (S$161) to more than 90 per cent of eligible residents. She suggested that such an initiative would be better, as it would put money directly into the pockets of citizens here.

In response, Mr Iswaran said that the government's GST offset credits - which it is doubling this year - would be better as it provides 'total flexibility' for how the money should be used.

'Ours is the ultimate shopping voucher,' he said. 'It's not for the government to tell you how to spend your dollar. Whether you want to spend it on food, at the supermarket, clothes, utilities - that's your choice. And that, to me, makes a lot more sense.'

This article was first published in The Business Times on February 06, 2009.