PETALING JAYA: Small businesses can better cope with the fallout of the weak economy, now that the wage subsidy programme and the Special Prihatin Grant have been extended.
SME Association of Malaysia president Datuk Michael Kang (pic) said these additional measures will enable more companies to retain their employees amid fears of further layoffs in the sector, particularly those that have been hard-hit by the movement restrictions.
“Our survey shows that about half of SMEs still need help to recover. The wage subsidy extension will help those that need it. Our survey also shows that about 20% of SMEs will close down if there is no help at all. This will at least help half of them to continue their business.
“It is good enough as government funds are also limited. It will help to keep more jobs, ” he said.
Prime Minister Tan Sri Muhyiddin Yassin announced additional measures yesterday under the Kita Prihatin package aimed at helping the lower and middle income groups as well as employees and micro-enterprises.
One of the initiatives mentioned was a more targeted wage subsidy programme, known as Wage Subsidy Programme 2.0, with an allocation of RM2.4bil, to benefit some 1.3 million workers.
The scheme will be open to companies that are still registering a decline of at least 30% in sales compared to the previous year for the period of the recovery movement control order (MCO).
The wage subsidy will be given for three months at a rate of RM600 per employee each month subject to a maximum of 200 employees. The Prime Minister also noted that the wage subsidy expansion will be open to companies that have registered with Perkeso up to Aug 31.
New applicants that have not received any disbursements under the previous wage subsidy programme will be eligible for six months of wage subsidies under the new scheme.
Application for the Wage Subsidy Programme 2.0 will be open from Oct 1 till Dec 31.
Kang added that this will also enable more businesses to have a better grasp of their cash flow for the next few months and aid them with planning their loan repayments.
“This will make it easier for them to plan and talk to banks, especially those that need to reschedule and restructure their loans after the automatic loan moratorium ends, ” said Kang.
Another initiative that has been extended is the Special Prihatin Grant for microenterprises which will be reopened from Oct 1 to Oct 31. The grant of RM3,000 per microenterprise is expected to be disbursed from Nov 25. A total of RM600mil has been allocated for the grant.
These measures may, however, have limited impact on SMEs as they are mainly targeted at microenterprises which generally do not have heavy expenses. Additionally, the grant amount is also relatively small and only offers petty traders a short-term respite.
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