In regards to S$370 million in payouts erroneously credited to companies under Jobs Support Scheme in October

Roughly S$370 million in government payouts beneath the Jobs Support Scheme (JSS) were erroneously credited to about 5,400 companies in October this past year, after mistakes were made in computing the disbursements.   

The overpayments constitute about 6 % of the quantity paid out under JSS previous October, said the Ministry of Trade and Industry (MTI), the Ministry of Finance (MOF) and the Ministry of Manpower (MOM) on Thursday (Apr 8).

Explaining what took place, the ministries stated the payouts were computed based on the dates that the companies reopened following the COVID-19 “circuit breaker”, which will ended in June this past year.

However, there had been “errors in the compilation and processing of organization reopening dates”, stated the ministries in a media release. The companies that were paid extra were erroneously tagged as having reopened later, making them qualify for a higher payout.

About 5,400 firms were affected, or about 3.6 % of most companies that received payouts.

The affected companies are mostly those that support projects in the construction, marine and process sector and tourism sector, said the ministries.

The Government expects to recuperate most of the amount of money through computerized offsets from subsequent JSS payouts, and companies returning the excess payments, said the ministries.

The JSS was introduced during the Spending plan in February this past year to help organizations retain local personnel by subsidising their salaries. The Government later extended the scheme to provide more support to firms because so many had to close through the circuit breaker from Apr 7 to Jun 1.

Authorities had said last month that about 5,500 employers will have their March 2021 payouts delayed until end-April, “pending a good reconciliation” by MTI on organizations' reopening dates used in the computation of the payouts.

Some businesses were permitted to reopen in phases when the circuit breaker ended, businesses in the construction, marine and method sector and tourism sector could only reopen upon approval from MTI.

Government agencies received a lot more than 1.8 million applications, which were then consolidated by MTI.

“As the operations for the resumption of business activities had to be applied at short find, MTI used existing devices and manual procedures to grant approvals for businesses to reopen,” explained the ministries in the news release.

“Unfortunately, by doing this, mistakes were made out of the reopening dates and concomitantly the JSS payouts and overseas worker levy/waiver payable,” they added.

“The error meant these companies were deemed to have already been closed for an extended period of time, and so allocated an increased JSS payout.”

For example, a lender that could resume businesses following the circuit breaker ended was tagged with a after reopening date since it was a customer in a construction job that needed acceptance from MTI.

Of the S$370 million that was erroneously paid, S$140 million will be recovered through computerized offsets from subsequent JSS payouts, and S$200 million will be through the “commitment of the bigger affected businesses contacted by MTI and other agencies to return the excess repayment”, the ministries said.

The Inland Earnings Authority of Singapore (IRAS) will first offset the excess amount against the businesses’ future JSS payouts. If potential payouts will be insufficient to offset the volume of excess repayment, the authorities will inform affected businesses of any spectacular excess amount to be returned following the businesses’ last JSS payout, they said.

“Instalment payment arrangements may also be obtainable for businesses that need them,” the authorities said. No action is required from afflicted businesses for now, they added.

Businesses that desire to return the outstanding excess volume upfront may do so through IRAS. Guidance will be contained in the letters to the affected businesses.

Concurrently, 1,100 businesses were recognized to be eligible for additional JSS payouts, amounting to SS$5.5 million. The excess JSS allocation will be credited to businesses by end-April 2021, the ministries said. 

Because of the incorrect tagging of businesses’ reopening dates, excess foreign worker levy waivers and rebates amounting to about S$1.2 million were also granted to 360 businesses in June and July 2020, the ministries said.

MTI and MOM said they will get in touch with the infected businesses to recover the surplus waiver and rebate. 

About 1,200 businesses will be granted S$6 million in additional waivers and rebates after having been recognized to meet the requirements. The waiver will come to be automatically altered from the businesses’ future levy bill, as the rebate will come to be credited to businesses straight.

No action is necessary from infected businesses for the present time. MTI and Mother will inform damaged businesses of any follow-up activities required by Might this year, the ministries said.

According to the ministries, IRAS initial detected anomalies in November this past year within its regular processing checks on the JSS.

Subsequently, several businesses likewise informed IRAS that they could have obtained excess JSS payouts.

“In December 2020, the reason for the overpayments was subsequently traced to discrepancies in corporations’ reopening dates,” they said.

After being informed by IRAS of the discrepancies, MTI embarked on an “extensive investigation” with other agencies.

“MTI established that there have been errors found in the compilation and processing of business reopening dates, that was used for the computation of the JSS payouts and dedication of businesses’ eligibility for levy waiver and rebate,” the authorities said.

To prevent a potential recurrence of the problem, MTI has worked with MOF, MOM and IRAS to rectify the functions and implement additional checks to find and flag possible errors, the ministries said. 

They added an exterior auditor was engaged to conduct a “thorough check” to verify the reopening dates that are being used in the computation of JSS payouts.