While Raeesah Khan’s bombshell admission in Parliament yesterday (1 Nov) may have grabbed all the headlines, there were many other noteworthy developments.
For one, several changes were made to the CPF rules, including a quicker disbursement of funds after the death of a member.
Then Manpower Minister Tan See Leng announced that the retirement and re-employment age will be raised to 65 and 70.
Is this a good or a bad thing? Let’s delve a little deeper.
What Do the Retirement and Re-employment Ages Signify?
At the moment, the retirement age in Singapore is 62. This statutory minimum retirement age is in place to protect older employees who wish to continue working.
So, if the retirement age is 62, this means that employers are not allowed to dismiss any employee below age 62 because of their age.
As for the re-employment age, employers must offer re-employment to eligible employees who turn 62, up to the re-employment age of 67. Once again, this requirement will provide older workers with more opportunities to work longer if they wish to do so.
Of course, this doesn’t mean that one has to work until their re-employment age. It simply allows them to do so.
As Mr Tan said, “Those who do not wish to continue working need not do so, and can enjoy their retirement.”
Given that the current re-employment age is 67, workers will be eligible for re-employment if they:
- are a Singapore citizen or Singapore permanent resident
- have served their current employer for at least 3 years before turning 62
- have satisfactory work performance, as assessed by their employer
- are medically fit to continue working
- were born on or after 1 July 1952
Retirement & Re-Employment Age in S’pore to be Raised to 65 & 70
Starting next year, both the retirement and re-employment ages will be progressively raised to 65 and 70.
This process will begin on 1 July 2022, when the retirement and re-employment age will be raised to 63 and 68 respectively.
The retirement will eventually be raised to 65 by 2030, and the re-employment age to 70 by 2030 as well.
As Mr Tan noted, the portion of workers of the resident labour force aged 55 and above had increased by 16.5% in 2020 from a decade ago.
Older Workers’ CFP Contribution Rates to Be Increased
The CPF contribution rates for older workers will also be increased for the first time, kicking in on 1 Jan next year.
Workers aged above 55 to 70 will see their CPF contribution rates raised by up to 2 percentage points.
There are no changes, however, to the CPF withdrawal ages.
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Featured Image: Justin Adam Lee / Shutterstock.com
