It will also consider 'very seriously' a suggestion that one-off assistance measures be given to those without enough Central Provident Fund (CPF) savings to help them enter the scheme.

Dr Ng gave these commitments yesterday at a media conference, when he responded to a committee's report on a compulsory annuities scheme to provide Singaporeans a more secure retirement.

The Government has accepted its recommendations, which were made public the previous day.

Dr Ng dwelt at length on the issue of getting workers to voluntarily opt in to the scheme, which is mandatory for workers aged 50 and below this year.

He did not give details on how it will be done but stressed the Government will 'facilitate' their entry.

It is a key issue, he said, that will be addressed as Singapore prepares to introduce the scheme in five years' time.

The proposed scheme has fixed a hitherto 'inadequate' retirement system - a problem which Prime Minister Lee Hsien Loong and his Cabinet ministers had been mulling over for the past three years.

'It's a great weight lifted off one shoulder, now it's transferred to the other shoulder,' said Dr Ng. 'CPF Board will have to bear this but the foundations are much stronger (now).'

The Board will run the scheme, under which workers pay premiums out of their Minimum Sum to get a monthly income for life.

But three groups are free to decide whether they want to be in it:

One, workers older than 50 this year. There are about 1.06 million of them.

Two, those with less than $40,000 in their Minimum Sum balances at age 55. They make up one-quarter - about 9,000 - of the 35,000 workers aged 50 this year.

Three, informal, self-employed and contract workers with no CPF. There are about 100,000 of them.

To get them all in, the CPF Board will, in the immediate future, 'be embarking on an aggressive campaign to encourage opt-ins''.

'We'll facilitate opt-ins because I think this is a much-needed piece in our CPF system,' said Dr Ng.

But, he acknowledged, they will have to pay relatively higher premiums or accept lower payouts for life.

The suggestion that the Government give them one-off assistance measures was a 'sensible' one, he said. It will respond in due course.

Asked for more details, he said financial help schemes will need to 'adapt to new challenges'.

But they must be delinked from the CPF system, which is based on the principle that people spend only what they save. This principle of self-reliance is cardinal, he said. 'We shouldn't mix the two. Once we do that, it will weaken both systems.'

He used the same line of argument against critics who said the scheme excludes those who need it most: the lower-wage and the elderly.

'If we have a situation where somebody with a bigger balance compared to someone with a smaller balance gets the same payout, then both will say, 'Well, maybe I don't have to contribute to my CPF, somebody else will top up.'

'Obviously that's not workable and we should keep to this principle that if you want a higher payout, you must save more, have a higher Minimum Sum, and we will give you a higher payout.'The scheme should also not undermine family support as a key source of retirement savings, he added.

As for the CPF Board, it has already swung into action. Yesterday, it set up a hotline 1800-Life CPF (1800-5433-273) to handle queries.

But it has its work cut out for it, said Dr Ng. New to the game, it will have to appoint consultants and actuarists to operate the scheme.

xueying@sph.com.sg

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