The planned increase in Central Provident Fund (CPF) contribution rates should not be delayed any further as the Government would need to “keep pace with implementation”, said National Trades Union Congress (NTUC) deputy secretary-general Heng Chee How on Thursday (4 February).
The increase in CPF contribution rates was initially set to take place on 1 January this year but was delayed to 1 January next year due to the COVID-19 crisis.
Depending on the worker’s age, employers and workers will need to contribute either 0.5 percentage points or one percentage point more for workers aged 55 to 70 years old.
Speaking to reporters after meeting mature workers at National University Hospital, Mr Heng noted that Singapore is in a good position to realise the earlier tripartite agreements on the improvements to the CPF contribution rates, as well as the increase in retirement and re-employment ages.
“It is important that we do keep pace with implementation because this was not done haphazardly or as a matter of negotiation.
“It was done with a purpose to better enable mature workers to continue to have the chance and the choice to make that contribution and continue to save for their retirement adequacy. This is very important for the labour movement,” he told The Straits Times.
Mr Heng who is also a Member of Parliament for Jalan Besar GRC, pointed out that last year’s “emergency situation” had caused the increase in CPF contribution rates to be deferred.
“It was because of the circuit breaker and retrenchments that were happening. We didn’t want a particular segment of workers to be highlighted as becoming more expensive. But on an overall basis, we should not delay,” he added.
Mr Heng reassured that the situation will be monitored closely for the rest of the decade to gauge the pace of such an implementation.
He added that the schedule for the raising of the retirement and re-employment ages should remain unchanged.
The retirement age will be raised from 62 to 63, and the re-employment age from 67 to 68, beginning from July next year.
Noting that about 100 unionised companies have agreed to raise the retirement or re-employment ages ahead of schedule, Mr Heng said that older workers would have to continue to upskill and undergo training.
“In working on company training, please do not forget your mature workers,” he said.
“COVID-19 makes it abundantly clear… that the future is going to be a lot more digital. So confidence and comfort in using digital tools at a very basic level will become part of the common language that we all have to learn to use. And certainly, older workers should be part of this learning process.”