The Restaurant Association of Singapore, in a recent proposal, called for subsidies under the Progressive Wage Credit Scheme to be raised to 75% for the period from 2026 to 2028, up from the current 50%, according to The Straits Times.
People look at the menu displayed outside a restaurant in a shopping mall in Singapore on May 15, 2021. Photo by AFP |
It also recommended scrapping foreign worker levies, shortening the wait time for Progressive Wage Credit Scheme payouts and allocating more funding to support employees’ parental leave.
The industry has been facing a “perfect storm of rising costs, labor shortages and shifting consumer habits,” the association said, adding that it was seeking government intervention to improve cost predictability and boost domestic demand in the food and beverage sector.
Singapore’s food scene saw 2,431 closures in the first 10 months of last year, of which 63% did not last more than five years, according to government data cited by The Business Times.
Pointing to the sector’s contraction in 2024 and record levels of business closures, the association warned that the long-term sustainability of food and beverage businesses, particularly small and medium-sized enterprises, is at risk.
Another key recommendation focuses on rental stabilization, as rental expenses remain a major fixed cost for the industry.
The association said providing “essential cost predictability” would allow businesses to make better-informed, long-term financial plans.
It has proposed policy interventions to address excessive rental renewal hikes, such as capping increases or linking them to macroeconomic indicators like gross domestic product growth.
To further support local businesses, the association has urged the adoption of stronger measures, including higher foreign worker quotas and more streamlined licensing fees.
“There is no doubt that a vibrant and thriving food and beverage industry is key to making Singapore a great country to live in and visit, residents and tourists alike,” said Benjamin Boh, president of the association.
He added that the proposals would give owners and operators some “breathing room” to strengthen their business structures while coping with external market pressures.
The Restaurant Association of Singapore, established in 1980, represents over 500 members and nearly 800 brands, spanning more than 5,000 outlets.
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