BOSSES who receive Jobs Credit payments are expected to do their utmost to save jobs and to retrench staff only as a last resort.

But they are not abusing the wage subsidy if they must lay off workers as a result of business restructuring, Minister in the Prime Minister's Office Lim Hwee Hua said yesterday.

She was responding to Bishan neighbourhood committee vice-chairman William Swee, who asked at a residents' dialogue whether employers had any legal or moral obligations under the scheme.

The $4.5billion scheme aims to help employers hold on to workers during the global economic downturn by defraying their wage bills. For every resident worker on their Central Provident Fund payrolls, bosses get 12per cent on the first $2,500 of the employee's monthly wage.

Mr Swee, 69, a freelance consultant, claimed that an organisation which received Jobs Credit had laid off five employees, but gave increments to top management and later took in new recruits.

He did not name the organisation.

Mrs Lim said he was right to expect employers to do their best to reduce the number of layoffs after receiving Jobs Credit. But there was a need to look at the specifics, such as whether they had had to restructure their business. She asked him to provide details of the organisation after the dialogue.

Mrs Lim, who is Second Minister for Finance and Transport, also addressed the future of the scheme beyond December.

Prime Minister Lee Hsien Loong is set to announce at the National Trades Union Congress' Ordinary Delegates Conference tomorrow whether it will be extended and, if so, in what form.

Mrs Lim said there was a need to balance two concerns: not making the scheme permanent, and addressing businesses' worries that removing it completely will hurt their cash flows.

Businesses and the labour movement want a gradual phasing out of the scheme rather than an abrupt halt.

As to whether there will be long-term measures in place of the Jobs Credit scheme, she said this was a decision for the Economic Strategies Committee.

The 25-member panel chaired by Finance Minister Tharman Shanmugaratnam will put forward its key recommendations on gearing up Singapore's economy for the post-crisis world, in January next year.

GOH CHIN LIAN

This article was first published in The Straits Times.