The minimum age to receive monthly payouts from Central Provident Fund (CPF) savings will not be lowered for now as it was raised to 65 only last year, Manpower Minister Josephine Teo said yesterday.
Employees appear to be more concerned about being able to work longer and save more, she told Parliament, which is why her priority this year is to build a new consensus between workers, employers and the Government on the retirement and re-employment ages.
She was replying to Ms Lee Bee Wah (Nee Soon GRC), who said retirees have approached her asking for an earlier CPF payout, as they lack money but are healthy and cannot appeal on medical grounds.
In fact, said Mrs Teo, more than half of the Organisation for Economic Cooperation and Development countries, which are developed nations, have set their pension withdrawal age at 65 or older.
Some are raising it in the light of increasing longevity, she added.
For example, The Netherlands, Denmark and Germany are raising their respective pension withdrawal ages gradually to reach 67 by 2021, 2022 and 2029.
"So against such a backdrop, we must really ask if it is wise to lower our own PEA (payout eligibility age)," Mrs Teo said, referring to the minimum age at which CPF members can start receiving their monthly CPF Life payouts.
However, permanently incapacitated or terminally ill CPF members, for example, can apply to withdraw their savings or start their payouts before age 65 under the Medical Grounds Scheme. Most applications - about 65 per cent - in the past three years were successful.
Mrs Teo also disclosed the payout eligibility age was not a major concern for workers during feedback sessions held by the Tripartite Workgroup on Older Workers.
The group, of which she is an adviser, began its review of the retirement and re-employment ages, plus the impact of CPF contribution rates on retirement adequacy, last year.
She has since met union leaders from industry clusters such as aerospace, logistics, healthcare, financial services and the public sector. The feedback from the sessions and focus group discussions with people was that workers want the opportunity to work longer and save more.
"I want to be able to help make it happen (for these workers). At the same time, employers have also expressed their concerns to me. They have worries about their increased obligations," she said, adding that their considerations should not be taken lightly and dismissed.
This is why it is important to find common ground and consensus on the retirement age, which is 62, and the re-employment age, which is up to 67, she said.
"The new tripartite consensus is an important one and is the topmost of my priorities this year."