Tue, Aug 20, 2019 - Page 6 News List

Singapore to raise retirement age as it prepares for leadership transition

AGING NATION:The city-state is to raise the retirement age to 65 from 62 and the re-employment age to 70 from 67 as it prepares for elections no later than 2021

Bloomberg

Singapore extended support for older workers in the aging island nation, as the current leadership prepares to hand over to a new generation in coming years.

The retirement age is to be gradually raised to 65 from 62, Singaporean Prime Minister Lee Hsien Loong (李顯龍) said on Sunday in his annual National Day Rally speech.

The re-employment age, where employers must offer work in the same organization, is to rise to 70 from 67.

The city-state will also increase pension-contribution rates for workers so that by 2030, any worker age 60 or below will get the full rate, Lee said.

The government is looking ahead to elections that must be held by 2021, while Lee is preparing to hand power to new leaders “in the next few years.”

The measures build on support Lee’s government already is giving to older citizens, including S$6.1 billion (US$4.4 billion) it set aside this year for a fund that includes subsidized healthcare for those in their 60s.

The pledges come as the trade-dependent nation grapples with fears of a global recession and an intensifying rivalry between its two biggest trading partners.

In the past week, the government slashed its economic outlook for this year to a range of zero to 1 percent growth, predicting what could be its most sluggish year in a decade.

The government is to help businesses adjust to higher costs associated with the pension changes, as employers are required to match their staff’s retirement fund contributions.

Singaporeans now have the longest life expectancy in the world at nearly 85 years, Lee said in his speech, adding that there are 1,300 centenarians among a population of less than 6 million.

Singaporean Minister of Manpower Josephine Teo in March said that a higher retirement age would encourage workers and employers to invest in upgrading skills and adapting jobs for older workers. Raising the re-employment age aims to give companies more flexibility to reset work terms — like salary and job scope — to deal with business uncertainties.

Lee also emphasized the threat low-lying Singapore faces from climate change.

It could cost S$100 billion or more over the next century to prepare the country to deal with rising sea levels, hotter temperatures and more intense rainfall, Lee said, adding that the effort was as critical as military defense to the nation’s survival.

“Everything else must bend at the knee to safeguard the existence of our island nation,” Lee said. “With climate change, we know for sure that sea levels will rise.”

All new developments will have to be built on platforms at least 4m above sea level, while critical infrastructure like the upcoming airport terminal and port must be built at least 5m above sea level, Lee said.

With almost one-third of the country lying just 5m above sea level, the government will also consider options such as building polders to protect existing low-lying areas — a solution employed in the Netherlands — and reclaiming land for offshore islands, Lee said.

The focus on climate change is a natural evolution from the priorities espoused by Singapore’s founding leader —Lee Kuan Yew (李光耀)— who ensured that the city-state was flush with greenery and that its design allowed residents to use underground passages to avoid the blistering heat and tropical downpours.

The government last month announced that it would invest S$400 million over the next two years to upgrade drainage systems. That would add to the S$1.8 billion already spent since 2011 to boost flood resilience, Singaporean Minister for the Environment and Water Resources Masagos Zulkifli said.

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