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SINGAPORE: With each Singaporean household receiving S$800 (US$600) in Community Development Council (CDC) vouchers – an increase from S$600 last year but without accompanying cash payments – Budget 2025 suggests a stronger government preference for this mode of social support.
The SG60 vouchers, offering S$600 for Singaporeans aged 21 to 59 and S$800 for seniors aged 60 and above, will function similarly to CDC vouchers. Alongside other targeted support measures like U-Save rebates and climate vouchers, this is a deliberate policy choice to focus on directing aid rather than providing broad-based cash handouts.
The CDC vouchers scheme offers tangible assistance to Singaporean households grappling with elevated prices.
While Singapore's Consumer Price Index (CPI) has moderated from 6.1 per cent in 2022 to 2.4 per cent in 2024, the cumulative effect of past inflation leaves consumers facing significantly higher prices. This is particularly so for essential goods like food, which has been a major contributor to inflation in recent years.
Despite rising median real household income and real household income per member across all deciles, these overall figures do not always translate to a sense of financial security. Anchored to past prices, many Singaporeans feel a loss of purchasing power in their daily expenses. Climate vouchers, previously limited to HDB households, have now been extended to private property dwellers, extending further help to Singaporeans who may be asset-rich but cash-poor.
The CDC Voucher Scheme commendably covers a wide range of essential goods and services at heartland merchants, ensuring that such injections are spent within a defined local ecosystem, even if some prefer the flexibility of unrestricted cash handouts.
This directed approach ensures that funds are channelled specifically to hawkers and heartland shops, stimulating local spending and generating an economic multiplier effect that supports job creation and competitiveness against larger chains and online platforms.
Utilisation rates have been high, with the government reporting that nearly all eligible households claimed and spent their vouchers in the 2021 and 2022 tranches. Over S$1.3 billion worth of vouchers were spent in the 2023 and 2024 tranches.
Business participation remains robust, with over 20,000 heartland merchants and hawkers onboarded by December 2022, many reporting significant revenue gains through the scheme.
The CDC Voucher Scheme also fits in with Singapore's political culture, which emphasises self-reliance and responsible spending. While highly liquid and widely accepted, the targeted nature of the vouchers steers resources towards desirable outcomes and aligns better with this philosophy than unconditional cash transfers that might inadvertently foster dependency.
As Budget 2025 is announced against the backdrop of the impending General Election, which must be held by November this year, some may have expected more cash transfers in an “election budget”.
Compared to SG50’s relative focus on financial support for seniors and lower income Singaporeans, there are more universal support schemes this year that directly benefit a broader segment of the population.
Politically, the CDC vouchers also provide a visible and tangible benefit, providing Singaporeans something concrete that they can use and see the direct impact on local businesses. Cash, though useful, can be easily diluted within general household spending, and its impact may be less noticeable.
Taken together with other family support measures, this Budget aims to project a strategic image of responsive governance. The symbolic support for the heartlands and hawkers is also aligned with the national goal of fostering a sense of community, oftentimes presented as evidence of the government’s commitment to the well-being of all Singaporeans.
Still, some may question whether relying on reactive measures is the most effective approach. Proactive policies to prevent excessive price increases could include controlling rental costs for merchants and strengthening supply chain resilience to keep the cost of necessities affordable to begin with.
However, one may argue that Singapore’s capacity to curb inflationary pressures is constrained as a small and open economy vulnerable to external shocks. Cost of living concerns also cut across a wide range of areas, from transportation to housing.
Nonetheless, macroeconomic interventions take time to influence economic behaviours and expectations, while vouchers provide immediate relief. An approach that combines both short-term measures and long-term strategies would be necessary.
Having evolved from a pandemic relief measure, the CDC Voucher Scheme has become an important feature of Singapore's social support framework, balancing household assistance with targeted economic stimulus and community building.
The established digital infrastructure minimises administrative overhead moving forward, the scheme is familiar to Singaporeans and broad merchant participation contributes to its ease of use. Given its digital efficiency and proven effectiveness, the CDC Voucher Scheme is likely to remain a key feature in future Budgets and continue playing a crucial role in managing cost-of-living concerns and supporting local enterprises in Singapore.
Dr Clara Lee is Research Fellow at the Institute of Policy Studies Social Lab, National University of Singapore.
Source: CNA/ch
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FAST
SINGAPORE: With each Singaporean household receiving S$800 (US$600) in Community Development Council (CDC) vouchers – an increase from S$600 last year but without accompanying cash payments – Budget 2025 suggests a stronger government preference for this mode of social support.
The SG60 vouchers, offering S$600 for Singaporeans aged 21 to 59 and S$800 for seniors aged 60 and above, will function similarly to CDC vouchers. Alongside other targeted support measures like U-Save rebates and climate vouchers, this is a deliberate policy choice to focus on directing aid rather than providing broad-based cash handouts.
The CDC vouchers scheme offers tangible assistance to Singaporean households grappling with elevated prices.
While Singapore's Consumer Price Index (CPI) has moderated from 6.1 per cent in 2022 to 2.4 per cent in 2024, the cumulative effect of past inflation leaves consumers facing significantly higher prices. This is particularly so for essential goods like food, which has been a major contributor to inflation in recent years.
Despite rising median real household income and real household income per member across all deciles, these overall figures do not always translate to a sense of financial security. Anchored to past prices, many Singaporeans feel a loss of purchasing power in their daily expenses. Climate vouchers, previously limited to HDB households, have now been extended to private property dwellers, extending further help to Singaporeans who may be asset-rich but cash-poor.
SUPPORT FOR BOTH CONSUMER AND MERCHANT
The CDC Voucher Scheme commendably covers a wide range of essential goods and services at heartland merchants, ensuring that such injections are spent within a defined local ecosystem, even if some prefer the flexibility of unrestricted cash handouts.
This directed approach ensures that funds are channelled specifically to hawkers and heartland shops, stimulating local spending and generating an economic multiplier effect that supports job creation and competitiveness against larger chains and online platforms.
Utilisation rates have been high, with the government reporting that nearly all eligible households claimed and spent their vouchers in the 2021 and 2022 tranches. Over S$1.3 billion worth of vouchers were spent in the 2023 and 2024 tranches.
Business participation remains robust, with over 20,000 heartland merchants and hawkers onboarded by December 2022, many reporting significant revenue gains through the scheme.
Related:
FOSTERING SENSE OF COMMUNITY
The CDC Voucher Scheme also fits in with Singapore's political culture, which emphasises self-reliance and responsible spending. While highly liquid and widely accepted, the targeted nature of the vouchers steers resources towards desirable outcomes and aligns better with this philosophy than unconditional cash transfers that might inadvertently foster dependency.
As Budget 2025 is announced against the backdrop of the impending General Election, which must be held by November this year, some may have expected more cash transfers in an “election budget”.
Compared to SG50’s relative focus on financial support for seniors and lower income Singaporeans, there are more universal support schemes this year that directly benefit a broader segment of the population.
Politically, the CDC vouchers also provide a visible and tangible benefit, providing Singaporeans something concrete that they can use and see the direct impact on local businesses. Cash, though useful, can be easily diluted within general household spending, and its impact may be less noticeable.
Taken together with other family support measures, this Budget aims to project a strategic image of responsive governance. The symbolic support for the heartlands and hawkers is also aligned with the national goal of fostering a sense of community, oftentimes presented as evidence of the government’s commitment to the well-being of all Singaporeans.
CDC VOUCHERS LIKELY TO REMAIN KEY FEATURE
Still, some may question whether relying on reactive measures is the most effective approach. Proactive policies to prevent excessive price increases could include controlling rental costs for merchants and strengthening supply chain resilience to keep the cost of necessities affordable to begin with.
However, one may argue that Singapore’s capacity to curb inflationary pressures is constrained as a small and open economy vulnerable to external shocks. Cost of living concerns also cut across a wide range of areas, from transportation to housing.
Related:
Nonetheless, macroeconomic interventions take time to influence economic behaviours and expectations, while vouchers provide immediate relief. An approach that combines both short-term measures and long-term strategies would be necessary.
Having evolved from a pandemic relief measure, the CDC Voucher Scheme has become an important feature of Singapore's social support framework, balancing household assistance with targeted economic stimulus and community building.
The established digital infrastructure minimises administrative overhead moving forward, the scheme is familiar to Singaporeans and broad merchant participation contributes to its ease of use. Given its digital efficiency and proven effectiveness, the CDC Voucher Scheme is likely to remain a key feature in future Budgets and continue playing a crucial role in managing cost-of-living concerns and supporting local enterprises in Singapore.
Dr Clara Lee is Research Fellow at the Institute of Policy Studies Social Lab, National University of Singapore.
Source: CNA/ch
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