With Singapore seeing an increase in seniors aged 55 years and above within the resident labour force, there have been debates centered around statutory retirement age, CPF contributions et cetera, to extend support for these seniors to continue working to be more financially independent.
On November 2nd, there were two key Bills that were passed in Singapore’s Parliament. These Bills surround amendments to the Retirement and Re-Employment age, as well as the CPF Act.
Specifically, what do the main changes entail?
- The retirement and re-employment age for Singapore workers will be progressively raised to 65 and 70 respectively, up from 62 and 67 currently. This process will start from 1st July 2022, with the retirement age being raised to 63 and the re-employment age to 68.
- In line with this increase, the CPF contribution rate for senior workers aged above 55 to 70 years old will also be increased by 2 percentage points starting from 1st January 2022. This change was deferred for a year in light of the impacts of pandemic on businesses.
According to the speech by Singapore’s Minister for Manpower Dr Tan See Leng, these two Bills would help Singaporeans better prepare for their retirement. With the increase in retirement and re-employment age, it introduces more flexibility for Singaporeans to work longer if they wish to. Not only that, with some amendments towards the process of payouts and contributions, it is now a more efficient process for Singaporeans to receive retirement payouts and navigate through their retirement journey with CPF.
Despite the changes in the statutory retirement and re-employment ages, there remains no changes to the CPF withdrawal policies or ages.
What does this mean for employers?
Employers are recommended to make changes around their current processes to encourage a more age-friendly workplace. With more seniors being part of the workforce, it is vital for employers to join hands to support this movement towards an inclusive workforce. Employers should consider redesigning policies, jobs and trainings to provide an environment that help seniors remain employable and allow them to better adapt and contribute their strengths the best they can.