Review of Monthly Basic Subsidy for Working Mothers with Singapore Citizen Children Enrolled in Full-Day Childcare Programmes
Ministry of Social and Family DevelopmentSpeakers
Summary
This question concerns the review of the $300 monthly basic subsidy for working mothers, as raised by Ms Joan Pereira who inquired about the timeline and criteria for potential increases. Minister Masagos Zulkifli B M M explained that the Government focuses on reducing out-of-pocket expenses through enhanced means-tested subsidies and fee caps for Anchor and Partner Operators. Recent policy changes include raising the additional subsidy household income ceiling to $12,000 and lowering childcare fee caps in 2023, with further reductions scheduled for 2025 and 2026. The Minister highlighted that expanding Government-supported preschool places to 80% by 2025 is more effective for affordability than increasing the Basic Subsidy. These initiatives aim to eventually make full-day childcare costs for dual-income families comparable to primary school and student care fees.
Transcript
28 Ms Joan Pereira asked the Minister for Social and Family Development (a) when will be the next review of the $300 monthly basic subsidy for working mothers with Singapore citizen children aged 18 months to below seven years old who are enrolled in full-day childcare programmes; and (b) what will be the factors considered before increasing the subsidy amount.
Mr Masagos Zulkifli B M M: The Government regularly reviews our policies to ensure that preschool out-of-pocket (OOP) expenses remains affordable for families. The Basic Subsidy is only one of several avenues affecting preschool affordability. In recent years, the Government has enhanced preschool affordability in other ways to effectively lower OOP expenses for parents.
In 2020, we raised the household income ceiling for means-tested additional subsidies from $7,500 to $12,000 and increased the quantum of additional subsidy across all eligible income tiers. In addition, we keep fees at Government-supported preschools affordable by imposing fee caps on Anchor Operators (AOPs) and Partner Operators (POPs). In January 2023, monthly fee caps for full-day childcare at AOP and POP centres were lowered by $40 to $680 and $720 respectively. With these moves, a median-income household, with a child attending full-day childcare in an AOP centre, would spend 3.1% of their household income on preschool in 2023, which is lower compared to 4.6% in 2019. We will further lower fee caps in Government-supported preschools in 2025 and 2026, so that dual-income families with a child in full-day childcare, in an AOP centre, will eventually pay around the equivalent of primary school and student care fees, before means-tested subsidies.
We are also increasing the number of Government-supported preschool places, which allows more families to benefit from these lower fee caps. By around 2025, 80% of preschoolers can have a place in a Government-supported preschool. This is more effective than increasing the Basic Subsidy in enabling the vast majority of families to benefit from lower preschool OOP expenses.