SBF supports the raising of the retirement and re-employment ages as well as CPF contribution rate for older workers
- Older workers are a valuable pool of talent as Singapore faces a shrinking workforce with an ageing population
- Encourages its member companies, trade associations and chambers to support the implementation of new statutory requirements
In recognition of the important role of older workers in Singapore’s labour market in the coming decades, the Singapore Business Federation (SBF) is calling on its 26,100 member-companies to support the raising of the retirement and re-employment ages to 65 and 70 by 2030, from the current 62 and 67 respectively, as well as the increase in CPF contribution rates for workers above 55, announced at the National Day Rally speech by Prime Minister Lee Hsien Loong today.
Raising of Retirement and Reemployment Ages
SBF Chairman Mr S.S. Teo said, “With medical advances, Singaporeans today enjoy more years of good health and can remain productive at work for more years. We hope the raising of the retirement and re-employment age for workers can also encourage companies to invest in skills upgrading and job redesign for their older workers.
“We also appreciate that the increases will be made incrementally. This gives our companies a longer horizon to make the necessary arrangements and adjustments.
SBF will work closely with our companies to understand and address the concerns they may have about the costs of retaining and training older workers, which could include healthcare needs such as insurance and medical leave.
“This is also good news for our workers as this could boost retirement adequacy and allow those who are still able and willing to contribute to do so.”
The first increase is scheduled to take place in 2022, with the retirement age adjusted to 63 and re-employment age to 68.
Increase in CPF Contribution Rates
On the increase in CPF contribution rates for workers above 55 over the next 10 years, depending on economic conditions, Mr Teo said, “Higher CPF contribution rates will encourage more of these experienced workers to remain in the workforce and help them build up their retirement nest egg. It is a good thing, given Singapore’s tight labour market. This also lessens the inequality in CPF contributions for our older workers.”
“SBF is glad that the Government will be rolling out the increments over the next 10 years, taking into account the economic conditions. This is definitely helpful for our companies, particularly our SMEs as the increase in CPF contribution rates will impact business costs and competitiveness. This is especially so when our companies, across different sectors and industries, are facing unique challenges in today’s uncertain global climate.
“SBF stands ready to assist our companies as they brace themselves for strong economic headwinds in the year ahead. We are heartened to note that the Government will help businesses to adjust to these new arrangements through a support package which will be announced in next year’s budget.”