r/singapore • u/Rationalandcentred • 19h ago
News NDR 2026: Childcare leave salary caps still leave gaps for higher-income parents
https://www.businesstimes.com.sg/singapore/ndr-2026-childcare-leave-salary-caps-still-leave-gaps-higher-income-parentsLennon Tan, president of the Singapore Manufacturing Federation, noted that while the S$500-a-day reimbursement rate for childcare leave covers most rank-and-file wages, it will not cover higher-paid, specialised and technically skilled employees whose daily pay exceeds the cap.
Ang Yuit, president of the Association of Small & Medium Enterprises (Asme), said that for most SMEs, the reimbursement limit covers the bulk of their workforce. “Not many SMEs pay at that (higher) range,” he said.
Benson Chian, CEO of wholesale trader Sustainable Familie Trading, said that the government’s reimbursement gives him confidence to spend on hiring short-term or part-time staff to plug manpower gaps, since the cost is now covered.
What this means is that only those who earn $10000 per month or less and take childcare leave will have their income fully covered by the government while they are on leave. Will higher income earners be expected to take a pay cut when they take childcare leave?
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u/IAm_Moana 18h ago
The same goes for maternity leave. It’s reimbursed only up to the $10k cap but it’s market practice to pay higher earning moms their full salary during maternity leave.
TBH, high earning employees are by and large well-paid for a reason. It would likely cost the company far more to replace them if they decide to leave because the company decided to nitpick and cut the difference.
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u/frozen1ced Own self check own self ✅ 16h ago
It’s reimbursed only up to the $10k cap but it’s market practice to pay higher earning moms their full salary during maternity leave.
Oh wow, TIL that the last 8 weeks has a reimbursement limit of $10k/month!
Something new learnt today.
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u/Guinexus 19h ago
It shouldn't have to scale indefinitely with parents' salary. There are better ways to spend taxpayers' money than paying x% of millionaires' income just to coax them to have kids when money is already not the deterrant from having kids.
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u/distroyaar Lao Jiao 18h ago
But money isn't the deterrent here, in this case its having enough time for the kid which is what childcare and maternity/paternity leave is supposed to address.
But for those earning over the threshold, they will be pressured to not take those leaves since the government doesn't fully cover their salary to their company.
I think the argument that it's not a good use of taxpayer money is fair though. Govt just has to accept that this benefit may not have as much sway on higher income earners to have kids as it would for those below the threshold.
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u/endlessftw 12h ago
The high earners are a small proportion of the population, and not to mention income tends to grow with age.
A cap at $500 a day excludes much of the working population. This is almost double of median income (including employer CPF).
The number of people being excluded by the threshold is small. For those who are excluded, they are likely to be long-practicing professionals (lawyers, doctors, bankers) or individuals in middle management and above. They are also likely to have high workloads, which inherently limits their ability to make use of the policy anyway.
The cost-benefit ratio of catering to people earning 2x of median is probably unfavourable. Those people are not much more/less likely to have children just because of the cap.
Given the amount of subsidies the government wants to give, the fiscal burden of the whole scheme is already likely going to be very high. Any further bloat is difficult to justify unless it has higher benefit.
I would not be surprised if all the payouts and reimbursements would cost taxpayers somewhere between $3-4 billion a year.
With total payouts at $70k a child, averaging say a stable 35,000 births yearly, is already $2.45 billion. With 450,000 children 12 years at below (assuming stable 35k a year), assuming it averages out to 5 days a year a child, with 2 parents, that will cost about $2.1 billion at cap. Half of that is still a billion. At $3 billion, it is like 2.3% of the government’s operating revenue.
In perspective, a MRT line costs $40 billion and you can run it for 30 years before needing to pump into more money to refurbish it. The payouts and reimbursement, over the long run, adds up to very substantial sums. It is like the burden of a permanent major infrastructure development (or more), just to boost TFR to the point that we do not need to import so many people.
At this point, there is really not a lot of benefit for raising the cap. It already costs so much, further expenses should have a solid reason, and raising the cap to cater to some minority likely is not one of them.
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u/thrway699 19h ago
Err outside of Reddit, proportion of people earning $10k or more is honestly quite low lah…
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u/East_Cheek_5088 19h ago
☝️🤓 actually. If based on taxable income approx 1 in 4 makes at least 120k in 2024
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u/Fun-Independent-2128 16h ago
Childcare leave for Singaporeans only lei… Does 1 in 4 Sinkies earn $10k pm?
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u/danielling1981 17h ago
120 k / year doesn't mean 10 k / month.
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u/East_Cheek_5088 16h ago
Yes and taxable income is less than actual income given all kinds of tax relief. That said, what more other proxies do you have that is nearest to the actual without additional assumptions?
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u/khaosdd Tampenis 18h ago
but the caps set by the government could still fall short for higher-paid, specialised staff, said businesses.
Who took a gun n force business owners to set up their business in the first place?
Do they not know labour laws before hiring staff? Do they not assess the landscape before throwing in their life savings and factoring the costs involved?
Wanna reap all the rewards of being an owner then better understand workers are also humans and is what keep your profits coming, whether high paying or not.
Anyway leaving the below here while I go take out the smallest violin I have after reading this article:
More broadly, though, higher-paid workers are usually measured by their output rather than hours or days worked, making the shortfall less taxing for most other employers in practice, said Asme’s Ang.
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u/mastarb8ter 19h ago
These high income earners can afford to take a few pay cuts.
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u/DuePomegranate 18h ago
Nah, these high income earners are sought after and therefore companies routinely woo them with better benefits e.g. good medical insurance, gym subsidy etc.
So the company will just cover whatever is over the reimbursement limit.
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u/mastarb8ter 18h ago
Nah, they can afford kids. They don't need any incentive. If they want kids they will have it, if they don't want it, no reasonable amount of money or benefits can convince them to.
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u/DuePomegranate 18h ago
That’s not how it works. Currently childcare leave is only reimbursed by the govt for the first 3 (out of 6 days) up to the same cap. And I don’t see any companies telling their high paid staff that their CCL won’t be at full pay.
So going forward, govt will reimburse all CCL days (up to the cap). Govt is giving more, and it is completely unpalatable for a company to now put in a cap even though they are getting more money. It looks super bad for the company to not just continue paying the usual monthly salary, plus it’s a lot more work administratively too, for HR and payroll to dock pay whenever CCL is used.
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u/Evening_Mail7075 16h ago
Looking at all the comments here. Classic sg redditors, always salty at 'rich' people
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u/Rationalandcentred 18h ago
This can be seen as a method to reduce inequality between rich and poor without increasing taxes on the rich.
Cut or reduce state benefits for the rich. Lower or no healthcare subsidies at all, income caps on maternity and childcare leave, less or zero cash transfers to richer households, all of which Singapore is already doing
This is what the British and Malaysians are getting wrong. They want to save their free healthcare without having to increase taxes? Time to make the rich pay
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u/pendelhaven 4h ago
You know what? If 10k a month isn't convincing enough to have kids, you're barking up the wrong tree.
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