Singaporeans who want to work beyond the age of 65 will eventually be able to do so under the law, Prime Minister Lee Hsien Loong said on Thursday at the May Day rally. The unions, employers and the Government are looking into extending the re-employment age beyond 65 by amending the Retirement and Re-employment Act, Mr Lee added, without giving a timeframe.
We look at 5 things about working beyond 65:
What is the official retirement age in Singapore?
The official retirement age in Singapore is 62. However, under the Retirement and Re-employment Act which took effect in 2012, bosses must offer healthy workers who have performed satisfactorily re-employment from ages 62 to 65, or give them a one-off payment.
Over the years, the retirement age has been raised from 55 to 62:
1955: The Central Provident Fund withdrawal age became the national retirement age when it was set at 55 by the British colonial authorities.
1993: Legislation passed to fix 60 as the statutory retirement age.
1995: Tripartite Committee on the Extension of The Retirement Age set up to study how the statutory retirement age could be raised progressively to 67.
1999: Retirement age raised to 62.
What is the Retirement and Re-employment Act?
The Act was passed in 2011, after more than three years in the works. The new law, which came into effect in 2012, made Singapore the second country in the world – after Japan – to legislate re-employment. Under the Act, workers must be medically fit and have at least satisfactory work performance to qualify for re-employment past age 62. The onus is on employers to prove that a worker is not eligible for re-employment.
The law aims to extend the working life of Singaporeans at a time when life expectancy is on the rise, from 68 in 1970 to 81 in 2009. The number of citizens aged 65 and above are expected to triple to 900,000 by 2030. By then, just two working-age citizens will support one elderly, down from around six now.
Have older workers benefitted from the Act?
An official survey has found that 99 per cent of private-sector workers who turned 62 in the year ending June 2013 were offered re-employment. Some 67 per cent of them were re-hired on their existing contracts, with no change to their employment terms. Among those re-employed in the same job in the private sector, 96 per cent did not experience a basic wage cut.
A survey released last month, however, found that four out of 10 Singaporeans would choose to retire at the age of 55. But two in three are realistic, and know that they will have to work until at least 60, according to an online poll by international recruitment firm Randstad. More than 6,500 workers in Singapore aged 18 to 65 took part in the poll between November and December last year.
What is the retirement age in other countries?
In Japan and South Korea, the official retirement age is 60 but many of their workers go on well into their 70s. Japan pioneered the practice of re-employment in 2004, by passing legislation requiring employers to provide for re-employment up till the age of 65 in one of three ways: raising the retirement age in their companies, introducing a structure for continued employment, or abolishing the retirement age.
In Britain, the default retirement age has been phased out.
The Australian government said on Friday that it wants to lift the pension entitlement age to 70 - the highest in the developed world - by the year 2035 to help cope with an ageing population. Australia has no statutory retirement age but men have been entitled to the pension at age 65 and women at 60 since it was introduced in 1908.
What experts say about raising retirement age v extending re-employment?
Some have proposed raising the retirement age to protect seniors who wish to work for longer from being fired on account of age. Veteran economist Lim Chong Yah, the former National Wages Council chairman, has suggested that the mandatory retirement age be upped to 65 years or more to address the shortage of labour supply.
Others, including some employers, prefer the more flexible approach of re-employing older workers who meet the criteria.