Retirement age could be lifted but time needed: PM

Office workers in the central business district (CBD). -- ST PHOTO: KUA CHEE SIONG
Office workers in the central business district (CBD). -- ST PHOTO: KUA CHEE SIONG

Raising the retirement as well as the re-employment age is on the cards, "but that may take a few years yet", said Prime Minister Lee Hsien Loong.

Over a dozen people, several of whom were near retirement, were keen for the Government to lift the age as soon as possible so that they could continue working.

But he told them that companies need time to get used to the re-employment arrangements, which came into effect in 2012. He was speaking at a live

MediaCorp forum called "Ask the Prime Minister" last night.

Singapore's retirement age is 62, after which employers have to offer re-employment to eligible workers up to age 65.

But with people living longer, the Government is working to help them stay employed longer. In May, the Government said it was looking at raising the re- employment age to 67.

Last night, Mr Lee said: "It would take a while for us to be ready to change the law and push it up by law because I think we need to give a bit of time for companies to get used to the arrangements and to see how they work out."

Companies are encouraged to keep their workers beyond 65 on a voluntary basis, and the Government does this often, Mr Lee said.

He also noted the long lead time Australia gave itself to raise its retirement age to 70 - the world's highest - by 2035.

"They haven't done it today or tomorrow. The 70 takes many years to phase in... but they start moving now and gradually they will get there," he said. "We must take that similar approach."

As Singaporeans look for chances to work longer, many are anxious as well about the adequacy of retirement savings.

A Twitter user asked if plans to offer Central Provident Fund (CPF) members the option of a lump sum withdrawal after they retire at age 65 would help them or burden the next generation.

"Well, it may be both," said Mr Lee.

It is reasonable to give retirees the flexibility to tap their CPF funds. "But there is a risk that if you do this too liberally, and when he grows old and doesn't have any CPF, somebody would have to support him," he said.

He added that the Government could look into letting people put more into their CPF accounts.

"You want to let people take it out to be flexible; you really should also be prepared to have people put a little more in" if they want to, he said, citing an idea by MP Foo Mee Har last month.

On the rising cost of living, he acknowledged that things had become more expensive over the years, but noted that incomes had also gone up faster than prices.

The strain on wallets could come from new expectations and lifestyles, such as owning air-conditioners and smartphones for instance.

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