A seniors group within the ruling People’s Action Party (PAP) has come up with the proposal for their particular demographic: for the contribution rate for workers aged 55 and older to be raised to 37 percent.
The PAP Seniors Group (PAP.SG) submitted this proposal to the Government, among others that concern seniors, in a 21-page position paper on Wednesday, January 30. According to the group, raising the CPF contribution rates for employees in their senior years will ensure their retirement adequacy. This would also allow for senior employees to receive the same amount of pay as younger workers.
PAP.SG believes that with a “combination of mandatory and voluntary CPF contributions as well as sound financial planning”, older workers can be assured of self-reliance.
The group announced this a press conference at the PAP headquarters in Bedok.
Speaker of Parliament Tan Chuan-Jin, who is also the chairman of the PAP.SG, announced that this proposal will be tabled on February 11, which is when Parliament will meet next. Tan said that the group made this proposal “so that all members continue to enjoy the same level of (contributions) regardless of how old they are.”
According to the group, “With longer life expectancy and a smaller base of family support, Singaporeans need to be even more self-reliant in securing a stream of lifelong income for retirement.” In 2030, one out of every four citizens is expected to be 65 years old and even older. At this point, one out of seven Singaporeans is in this age group.
Here are the current CPF contribution rates:
Workers under 55: 37 percent CPF contribution rate, employers give 17 percent
Workers aged 55-60: 26 percent CPF contribution rate, employers give 13 percent
Workers aged 60-65: 16.5 percent CPF contribution rate, employers give 9 percent
Workers 65 and older: 12.5 percent CPF contribution rate, employers give 7.5 percent
Aside from higher a CPF contribution for older workers, PAP.SG also recommends flexible working arrangements that would motivate them to keep working should they desire to do so.
“While many of our older workers want to, and can continue to take on full-time jobs, some prefer to work at a lower intensity through part-time work or with flexible work arrangements. Where we can improve is to push for the adoption of these efforts in more industries. While we are in a good position today, there is more we can do to further remove obstacles for our older workers,” the group said.
The group’s recommendations also touched on housing for seniors. “We recommend that (the authorities) consider a trial of small-scale group homes for frail seniors within our existing public housing estates. This can manifest in the conversion of several units. Moving forward, our seniors want more diverse housing options. Many seniors prefer to maintain their independence and age-in-place.”
On February 18, Finance Minister Heng Swee Keat will deliver the 2019 Budget statement, which he said would concentrate on healthcare, education, security, and defense.
Read related: Multiple PAP MPs oppose revising CPF automatic payout mechanism to start at age 65
https://theindependent.sg.sg/multiple-pap-mps-oppose-revising-cpf-automatic-payout-mechanism-to-start-at-age-65/