Seriously, I think they have used up people's CPF money and need
more time to replace it...
Withdrawal age of CPF Minimum Sum may be raised to 65
Posted: 20 June 2007 1659 hrs
SINGAPORE: The age when a person is allowed to withdraw the CPF
Minimum Sum could be raised from 62 to 65 in the near future.
This is one suggestion by Minister-in-charge of ageing issues, Mr
Lim Boon Heng, who has just returned from a study trip to
Japan.
Under the law, CPF withdrawal is tied to the prevalent retiring
age. So if the retiring age is raised, then the CPF drawdown age
would be raised as well.
In May, a tripartite committee studying the issue of employing
older workers in an ageing workforce said hiring older workers
beyond the age of 62 would become part of Singapore's employment
laws within the next five years.
To cope with an ageing population, Japan and some European
countries are already raising the age at which national pensions
are paid out to 65 and beyond.
By 2013, all Japanese will not be able to draw out their national
pensions until they are 65.
Singapore may follow-suit, with its CPF system. That is because the
average life expectancy of the elderly is now 82. So Singaporeans
need to think about how to stretch their savings.
Mr Lim said: "I think it is quite reasonable to raise it to 65, if
our objective is to raise the employment rate of this group of
people, but I think we should do so cautiously.
"So we should make employment happen. We should not leave people in
a situation where they can't get a job and yet the minimum sum
drawdown age is raised. So we must first make sure... that the
employment rate [is] going up."
The government is already getting employers and employees to
negotiate terms of re-employment, once the worker hits the
retirement age at 62.
Extending this retirement age is not a law yet, as the government
first wants to explore what types of issues will crop up and how
they can be resolved.
In Japan, the reemployment law states that the employer is obliged
to offer a job to someone who has reached the age of 60 until he is
65.
But how this is done is open to discussion. For example, employers
can pay the worker less, or arrange for another job for the
worker.
And the Japanese government is now thinking of raising the
retirement age to beyond 70.
It has even set a target of 90 per cent employment for those aged
60 to 65 by the year 2030.
Currently, 52.6 per cent of Japanese in this age group are
employed.
In Singapore, this figure is 41.9 per cent.
During his study trip, Minister Lim also visited nursing homes and
day care centres in Japan.
Many of the elderly in these centres are subsidised by a long-term
care insurance implemented by the state seven years ago.
But since it kicked in, financial outlay grew from S$45 billion to
S$87 billion last year.
So it is becoming clear to the Japanese that this is
unsustainable.
Mr Lim said such an example showed that the responsibility of
caring for the old, should not rest on the state.
"As the Japanese are realising, it is the family that should look
after the old and it is the community that should support the
family to look after the old. This is the lowest cost option for
any society," said Mr Lim.
And to help families, Singapore could take a leaf from Japan's
example, where there are courses for caregivers, who also have a
support network.
Mr Lim is also against giving state funding to these
caregivers.
In Japan, families cannot claim from the long-term care insurance
when they stay home themselves to look after the elderly, but they
can claim if they hire external help.
"This is a choice which people have to make based on their set of
values. And the set of values that I would like to maintain and
promote is that it is the duty of the family to look after its
old.
"Payment to family members breaks that link and I think it would
cheapen the care that the family members give to their old if we
equate that with payment," said Mr Lim.
Also, there is already the Eldershield plan, which allows the
individual or his family to decide what to do with the
payouts.
As for singles, Mr Lim said there are provisions made for them,
such as the building of studio apartments.
But as far as possible, he wants to encourage even singles to live
in their own homes, and better still with their families. -
CNA/yy
