SINGAPORE - A vision of "productive longevity" lies behind the recommendations made by the Tripartite Workgroup on Older Workers, said Minister for Manpower Josephine Teo on Thursday (Aug 22).
She was speaking at the annual dinner of the Economic Society of Singapore at Mandarin Orchard hotel.
Mrs Teo was explaining the thinking behind the recent moves to raise the retirement and re-employment ages, as well as Central Provident Fund (CPF) contributions for older workers.
Prime Minister Lee Hsien Loong announced on Sunday during his National Day Rally speech that the retirement age will go up to 63 in 2022, and eventually to 65 by 2030. The re-employment age will also go up from 67 now to 68 in 2022, and to 70 by 2030.
CPF contribution rates will also be raised over the next 10 years or so for workers aged 55 to 70, so that they can build up more retirement savings.
Mrs Teo said this vision of productive longevity is political, social and economic in nature.
"It is a political choice to treat our ageing workforce as an opportunity and not a burden, to enable our people to contribute as long as they wish... We allocate resources and update policy to support this choice," she said.
Mrs Teo added that it is also part of Singapore's political values to share the effort that is required.
"We are expecting employers to do their part to develop inclusive workforces and progressive workplaces. For example, physically demanding jobs may need to be redesigned to reduce the strain on older workers. They may also need to cater to some older workers' desire to work at lower intensity at this phase of their lives," she said.
She noted that workers must also be willing to reskill and move into new roles, while accepting that beyond a certain age, the terms and conditions of employment may change. They must also participate in helping their employers transform to stay competitive.
The Government must also support workers and businesses, she said. More details on a package of support will be shared at next year's Budget.
"We accepted the workgroup's recommendation that a package of wage offsets will help bring relief throughout the next decade of changes to the retirement and re-employment age. Each time the CPF rate is adjusted, too, transition support will also be provided," she added.
The growing pool of older workers is a resource that businesses can tap.
"This can potentially bring some relief to a tight labour market (and) help employers better meet their manpower needs...," Mrs Teo noted.
"For the individual, work produces income and improves retirement adequacy... Work is often an integral part of a person's identity... and provides a natural community to be a part of... The engagement, relationships and sense of purpose derived from work contribute to the health of older workers."
Having a retirement age also remains relevant today.
Mrs Teo said: "The Retirement Age Act prevents employers from prematurely dismissing an older worker because of age. It provides legal protection for our older workers. But it does not take away an older worker's freedom to stop working any time he or she wishes."
Mrs Teo also touched on how the pace of the changes is calibrated.
"Only the first two moves have been pinned down - on Jan 1, 2021, for the CPF rate hike and on July 1, 2022, for the retirement and re-employment age. The remaining moves will be a matter for tripartite consultation which can take into account the evolving economic landscape and still provide ample notice to the employers and to the workers," she said.