Caring for the caregivers

Those who have spent decades on unwaged work at home caring for the young or elderly face the risk of being left out in the cold when it's their turn to be cared for in old age. The normative model of family-based care is being destabilised by shrinking family sizes, the plight of widows with extended families abroad, and the financial burdens of multigenerational households. How can homemakers be helped when they lack CPF savings?

The strengths of the CPF system, as a self-funded, national retirement scheme, are many. That its members can take out largely only what they put in is key to its fiscal sustainability. Those with accounts benefit from not only its risk-free returns but also periodic transfers from the government Budget. But unpaid homemakers will have little to fall back on, and, since most are women, the unintended effect is of a gender bias. The consequences cannot be dismissed in an ageing society where women tend to outlive men.

Despite steady improvements over the years, women's CPF balances, incomes and labour-force participation rate remain significantly lower than men's, at 59 per cent last year. The disparity is evident elsewhere too, giving rise to schemes to provide for women in their old age. In Japan, dependent spouses of full-time employees qualify for pensions without paying contributions. Britain's state pension scheme makes provisions for married women and widows. Germany and Sweden provide caregiver credits tied to retirement benefits. Silver Support here will help boost retirement incomes of eligible seniors, including non-working women. But such schemes will weigh on working adults as the old-age support ratio becomes more challenging everywhere.

It makes sense as a national strategy, therefore, to retain the family as a key pillar of support in old age. Given the natural tendency to focus on immediate rather than future needs, there must be various forms of positive reinforcement to ensure husbands and adult children set aside something for their wives and mothers through voluntary top-ups to the women's CPF accounts all through their careers. One way is to make such contributions automatic for working spouses unless they opt out, as suggested recently by Institute of Policy Studies research fellow Christopher Gee. That small tweak in the rules could result in a big change in behaviour. In the same vein, the Women's Wing of the People's Action Party wants more done to encourage such top-ups.

While no single measure will be sufficient to address the gender imbalance in retirement funds, each can help to enhance old-age security for the carers in society, who deserve to be cared for in turn in their golden years.