NDR 2026: Businesses welcome government move to cover childcare leave costs, but manpower concerns remain

Singaporean businesses have reacted positively to the government's decision to fully cover the costs associated with childcare leave. Prime Minister Lawrence Wong announced during the National Day Rally that parents will receive more childcare leave, with employers' costs for statutory child-related leave schemes being fully reimbursed by the government, up to a certain limit. This move aims to support families by easing the financial burden on employers.

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While it will undoubtedly impact the company, I truly believe the merits will offset any gaps that the company might face. With advance planning of workflows and empathy between departments, gaps can be covered.

Under the enhanced scheme, each parent will be entitled to eight to 12 days of leave annually, depending on the number of Singaporean children under 12. This is an increase from the previous six days for parents with younger children and two days for those with older children. The government currently shares these costs with employers, but the new policy shifts the full reimbursement burden to the state, providing significant financial relief.

While the financial aspect is welcomed, some businesses highlight ongoing challenges related to staffing. Mr. Ronald Soh, founder of Win-Pro Consultancy, noted that while the cost burden is removed, the absence of the employee still impacts operations, particularly for small and medium-sized enterprises (SMEs) that run on lean staffing models. "The actual person has also been taken away," he stated, emphasizing the operational gap created by leave.

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On the surface, it looks like the cost burden is taken away. However, the actual person has also been taken away. So that creates an impact on us as well, because SMEs are very lean and they work very tight.

Others, like Mr. Leon Lai, CEO of Betterment Group, are more optimistic, believing that proactive planning and inter-departmental empathy can mitigate the impact of staff absences. Mr. Julius Holmefjord-Sarabi of Aureus Academy also expressed confidence in adapting, citing their company's operational structure. However, he acknowledged that many businesses might face challenges.

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It's good for Singapore to be really focusing and emphasising family and childcare, because it can be quite challenging to raise kids with the costs and the challenges in Singapore.

The Singapore National Employers Federation (SNEF) praised the government's initiative as a significant commitment to supporting both employers and families. CEO Hao Shuo suggested that the enhanced reimbursement could encourage employers to implement measures like engaging temporary manpower to address operational disruptions caused by staff absences. For businesses in sectors like food and beverage, where remote work is not an option, finding replacements for absent staff remains a key concern, as noted by Mr. Josiah Tan of OMMA Chicken Soup.

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The enhanced reimbursement support can also help employers adopt measures to address operational challenges arising from staff absences, including engaging temporary manpower where appropriate.