Thursday, 21 September 2023

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Cheaper, better, faster till 70 and beyond?

Andrew Loh

It is little wonder Singaporeans are anxious. Despite the government trumpeting that we have arrived as a “first-world country”, and boasts record GDP growth this year, and how “if Singapore Inc went for IPO, this is a $4 trillion company” (as PM Lee said in  2007), the fruits of economic growth seem to continue to elude them.

Indeed, even senior diplomat Tommy Koh weighed in on the issue of stagnant wages. “Singapore is a First World country with a Third World wage structure,” he said in September.

But wages is just one issue. Another, and perhaps a more emotional one, is that of the retirement age. We have heard everything from how we should not think of retirement, to how retirement will mean we’ll “shrivel up and face the wall”. Former NTUC Chief, Lim Boon Heng, the minister in charge of ageing issues, wants the retirement age to be raised from 62, to 65, then to 68 and finally to perhaps do away with it altogether.

Mr Lim was reported in June 2007 as “thinking of taking things a step further: to get Singaporeans to work beyond age 70.” (CNA)

Working till you drop, as the saying goes, seems to be the new economic philosophy of the government. Just like the two-is-enough population policy of the 1970s, many logical and persuasive arguments are being proferred by the government.

Working till your old age keeps you healthy and occupied. It helps you not to be a burden to your children. It affords you financial independence in your old age. You age “actively” – or what the government calls “active ageing”.

All well and good except that there is a fundamental flaw in this train of thought.

The basis for urging Singaporeans to work longer – and introducing legislation to coerce the people to do so – is that Singaporeans do not have enough to retire early.

This is a point which Finance Minister Tharman Shanmugaratnam raise in 2005. “This is of real concern,” he said, “because many Singaporeans in fact do not have enough in their CPF to meet even their basic retirement needs.” (MAS) Two years later, the government-controlled Straits Times repeated the concern. “According to surveys, many older Singaporeans do not have enough in their savings to retire on,” it said in a report titled, “The end of retirement”, in 2007. “The solution? Work longer.”

Yet, it seems no one has noticed the big fat white elephant in the room – where have all of Singaporeans’ money gone to?

“The Chinese have the highest savings rate in the world,” Minister Mentor Lee Kuan Yew said at the fifth Credit Suisse Salon held in Singapore in 2009,  “followed by Singaporeans who save some 40 plus percent of their income.” (Credit Suisse).

That alone begs the question: why is it then that Singaporeans do not have enough to enable them to retire?

Some have put the blame on Singapore’s housing prices. This is not surprising, considering that more than 80 per cent of Singaporeans live in flats provided by the Housing and Development Board (HDB).

The trend of escalating prices for public housing continued into 2010, prompting the government to finally do something about it by introducing measures to “cool” the market earlier this year. (Property Guru)

These measures, however, are piecemeal, reactionary actions taken after the fact. Their effectiveness are yet to be seen as prices, since the measures were introduced, have not seen any significant decrease.

And to add salt to the wound, Labour chief Lim Swee Say, in 2007, “urged workers not to be alarmed by the possibility that the draw-down age for the Central Provident Fund (CPF) minimum sum might rise from 62 to 65.”

It is a point reiterated by Mr Lim Boon Heng as well. “If the retirement age is raised, then the CPF drawdown age would be raised as well,” Channelnewsasia reported him as saying.

So, where do all these leave Singaporeans?

They are urged to work till their old age. The CPF draw-down age is raised. The minimum sum in the CPF has already been increased, since July 2010, to S$123,000, from S$117,000. Also from July, the Medisave Minimum Sum (MMS) was raised to S$34,500 from S$32,000. (CNA)

On top of this, Singaporeans are urged to work “cheaper, better, faster”, and to “upskill, reskill, multiskill”, to “upgrade” themselves.

In solving Singapore’s ageing population problem, the government seems to have created even more problems for Singaporeans. The huge influx of cheap foreign labour which compete with Singaporeans for jobs (at all levels) is dismissed as “necessary” to keep us “competitive”.

Yet, one would wonder, as I mention earlier in this article, with all the accomplishments which Singapore has achieved – fastest growing economy, record job creations, S$4 trillion IPO if we were a company, highest savings rate, a people who put in the most number of weekly work hours in the world  – all of which the government rattle of as a litany to prove its economic policies a success, why are Singaporeans still unable to retire to a life of peace and comfort, after a lifetime of slogging it out?

Clearly, something is not right somewhere.

While asking Singaporeans not to think of retirement and to adopt a life-long work attitude, the ministers themselves receive lifetime retirement payouts (pensions). Indeed, some serving ministers (those who’re above 55) are concurrently being paid the highest salaries in the world and receiving pensions at the same time.

Perhaps the answer and the solution no longer lies in trying to make the PAP government see this – especially when it has adopted an ultra pro-employer policy – but lies in registering our concern at the ballot box.

That, in my opinion, would be the responsible thing to do – as a Singaporean.

It will not only be for our own sake but also for the sake of our next generation.

We need new leaders. Our current ones have lost their way.

This too is clear.


Cartoons from My Sketchbook.

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