The national Budget should have more clarity and explicit in the effectiveness of Matched Retirement Savings Scheme as this scheme appears to be a pilot in Singapore, said the country’s leading women’s rights and gender-equality advocacy group, AWARE.
AWARE has raised the concerns about the matched savings scheme following the budget announcement made by Finance Minister Heng Swee Keat on Tuesday (18 Feb) saying that the new scheme is introduced to help lower-to-middle-income Singaporeans aged 55 to 70 who have not been able to set aside the prevailing Basic Retirement Sum (BRS) to save more in their CPF accounts.
“Why not top up eligible individuals’ accounts to meet the Basic Retirement Sum (BRS)? And what happens after the age of 70?” questioned Shailey Hingorani, AWARE’s head of Research and Advocacy, further probing that the organisation would like to understand more about the government’s definition on its success.
Citing an example from Mr Heng in his Budget speech – who said that the payout of retired couple who would together receive around $1,400 monthly, up from $570 – Ms Hingorani remarked that even with the new scheme, it would still not come close to $2,351, the necessary amount to sustain a basic standard of living which was calculated by researchers last year.
Noting that the matched savings scheme’s annual cap will increase up to $600 from 2021 to 2025, Ms Hingorani suggested that it would be useful to know how the calculation is done for the annual cap figure of the new scheme.
While Minister Heng announced that the new scheme will be eligible for about 435,000 Singaporeans, Ms Hingorani pointed out that a gender breakdown and a detailed breakdown of active and inactive members within eligible figure would be helpful as the number of eligible seems large relative to the country’s population.
“The 435,000 figure is still quite opaque, as we need more data on Singaporeans between 55 and 70. Without fuller details about the profile of people without BRS, the announced measures may not be reassuring enough, especially for those elderly without families or whose families cannot afford to support them financially,” said Ms Hingorani.
Nonetheless, AWARE applauded the effort of government, stating that the matched savings scheme was most welcomed by AWARE, as the scheme boost the women retirement adequacy.
Ms Shailey said, “As women on average live longer than men, initiatives that centre on elderly assistance, like this matched savings scheme, end up benefiting women more than men.”
AWARE believed that the scheme would provide support to the women who are more likely to not meet the BRS historically due to interconnected factors – such as the gender pay gap and family caregiving responsibilities – that hinder their professional advancement.
During the Budget speech yesterday, Mr Heng also announced that the government will increase the quarterly cash payouts in the Silver Support Scheme by 20%, which is from $750 to $900 per quarter, for the eligible lower-income seniors as well as broaden the eligibility criteria.
Speaking on this, AWARE commented that these enhancements reflects what AWARE had recommended in its 2017 and 2018 Budget submissions, while the announcement of eligible seniors do not have to proactively apply for Silver Support also reflected in its recommendation – so as to eliminate logistical barriers for recipients.
It was noted that AWARE had submitted its tenth annual Budget recommendations on 10 January.
AWARE also mentioned that the announced Senior Workers Support Package, which is a four-pronged strategy to boost senior employment, is looking promising as well.
In its statement, AWARE addressed that the Budget lacks of explicit solutions on the financial challenge faced by women and family caregivers as showed in January’s national report on the gender wage gap, as well as AWARE’s own recent report on eldercare’s negative impact on women’s finances.
“Some recommendations put forth by various proponents – such as making CareShield Life gender-neutral – went unaddressed,” AWARE added.
Amid of the Covid-19 outbreak, AWARE acknowledged that the announced budget 2020 balanced today’s most urgent needs while dealing with critical long-term issues.
AWARE hoped that the new measures in the Budget, which provide greater reassurance and support for seniors and low-income households, could be expanded on after the virus clears.
“AWARE seeks more clarity on these longer-term schemes to better determine whether they can sufficiently alleviate the future burdens of Singaporeans in need,” the statement read.
Addressing the well-timed of government support during the virus outbreak, Ms Hingorani said, “The sudden crisis shifted many priorities, spurring a number of one-off grants and top-ups.”
“That said, when the virus clears, we would like to see the government make bigger and bolder moves with regards to Singapore’s ageing population, instead of tweaks to our existing, straining, structures. When this upheaval subsides, our gaze should be trained on the future, including the generation making real sacrifices to care for today’s old folks,” she added.