Government Grants Available For Nightlife Businesses To Pivot Or Wind Up Operations

This article was first published on 11 November 2020 and has been updated with additional reporting.

While the majority of F&B and retail businesses have resumed operations and re-opened their doors, nightlife businesses are still reeling from the effects of the COVID-19 pandemic. Music and crowds in bars, pubs, clubs and karaoke joints have ceased since March 2020 after they were ordered to shut and business has yet to resume.

On 6 November 2020, it was announced that a small-scale pilot scheme with strict safety measures, such as wearing a mask on the dance floor and being tested negative for COVID-19, would be offered to some nightlife operators.

A two-month pilot for bars and pubs commenced on 8 December 2020. Currently, three outlets are on the pilot:

  1. Bar Kiharu, 150 Orchard Plaza, #03-17 
  2. Bell Bar, 5 Koek Road, Cuppage Plaza, #03-12 
  3. Skinny’s Lounge, 82 Boat Quay #01-02 

The Ministry of Trade and Industry (MTI) has announced that they will not be expanding the pilot to include more participants. This is in light of the increase in the number of unlinked COVID-19 community cases in Singapore. However, the pilot for the three bars and pubs will be extended until 7 April 2021. This is mainly down to the three outlets’ compliance with the SMMs throughout the pilot duration.

Meanwhile, on 18 January 2021, it was announced that the pilot for karaoke lounges and nightclubs, initially slated to begin in January 2021, has been deferred due to the increasing number of unlinked community cases in Singapore.  

This may be seen as a major blow to the nightlife industry. Furthermore, the MTI had already noted that “even if pilots turn out well, it is expected that the nightlife industry will not resume operations in their original form for a considerable period”. 

This means nightlife businesses will continue to be crippled or even remain shut. Such businesses have been encouraged to reconsider their options: to either pivot their business to other permissible activities or to wind up their operations. Financial support packages have also been made available for such businesses that are considering either options.

Read Also: COVID-19 Impact: 5 Reasons Many More Companies May Shut Down In The Coming Months

Government Support For Nightlife Businesses That Are Changing Their Business Model

Nightlife businesses have an option to receive support in pivoting their business to either F&B or other commercial uses such as gyms or offices. From now till March 2021, nightlife businesses that choose to do so can apply for a grant of up to $50,000 from Enterprise Singapore (ESG) to help defray the costs that would be incurred in efforts to pivot their businesses. For nightlife businesses that have already changed their business models, Enterprise Singapore will extend support to them on a case-by-case basis. Firms that apply for this grant can do so through the Singapore Nightlife Business Association (SNBA). 

MTI is also working with regulatory agencies such as Urban Redevelopment Authority (URA) and the Singapore Food Agency (SFA) to simply and expedite application processes to establish their F&B operations and license change which will take around 14 days compared to months previously.

Support For Nightlife Businesses That Are Exiting The Industry

An ex-gratia one-off payment of $30,000 may be given to businesses that are exiting the nightlife industry to help with costs of winding up the business. Firms can apply for this grant from SNBA from now till March 2021. 

In quitting the industry, some employees may end up being retrenched and employers should honour any retrenchment benefits contractually provided for or to follow the retrenchment benefit norms stipulated within the Tripartite Advisory on Managing Excess Manpower and Responsible Retrenchment. Employers can also seek financial support for one month of salary paid to each local employee and capped $3,000 per month. Those who are retrenched will also receive support in seeking alternative employment.

Read Also: MOM Responsible Retrenchments – Guideline For Companies To Be Fair And Decent

Other Types Of Government Support

For micro businesses with annual revenue less than $1 million or small businesses with annual revenue less than $10 million, they will be eligible to tap on a Simplified Insolvency Programme, launching in January next year, to help businesses restructure their debt or to wind up operations. Sole proprietors and partnerships can make use of the Sole Proprietors and Partnerships scheme to restructure their business debts. 

Read Also: Closing Down A Company In Singapore: Striking Off Company & Winding Up

Some businesses that entered into contracts before the COVID-19 pandemic and as a result are faced with substantial obligations can have their contracts renegotiated under the new Re-align Framework. Businesses may also terminate their contracts should they fail to come to a mutual agreement.

Read Also: How Small Businesses Can Use The Re-Align Framework To Renegotiate Existing Rental Leases

Despite the type of support a business chooses, there is a caveat: if a firm opts to accept either financial support package (nightlife businesses are only allowed to select one support package), they will not be allowed to participate in the pilot programme or resume nightlife operations for at least 12 months. 

Besides targeted support, nightlife businesses also receive grants such as the Jobs Support Scheme (JSS)rental rebate from April to July, the COVID-19 (Temporary Measures) Act, and more. Companies that pivot to F&B businesses can also leverage on targeted support for the F&B industry, including the Food Delivery Booster Packageand Digital Resilience Bonus, as well as support available to all enterprises like the Productivity Solutions Grant(PSG), Enterprise Development Grant (EDG), and others.

In pivoting, nightlife businesses may also need to hire and train employees. There are also many enhanced training subsidies available, including the Enhanced Training Support PackageSkillsFuture Enterprise Credits (SFEC) and more. While there is diverse financial support in place to assist the many nightlife operators (and other businesses) here, it may be a long while before we see Singapore’s vibrant nightlife scene resuming normalcy as long as the pandemic is at our doorstep.

(Additional reporting by Dinesh Dayani)

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