Raising Retirement Age

The majority of Singaporeans and permanent residents aged 50 and above support raising the re-employment and retirement ages, according to a survey by the PAP Seniors Group and National Trades Union Congress U Women and Family.[1]

Why would anyone be surprised?

Before an eligible employee of an employer attains the specified age, the employer must offer re‑employment to that employee. The employer’s obligation to re‑employ that employee begins from the time that employee attains the specified age, until that employee attains the employee’s prescribed re-employment age.[2][3][4][5]

An eligible employee may retire or be retired, if he or she does not wish to be employed by his or her employer on or after the date the employee attains the specified age.

In other words, an eligible employee has the right but not the obligation to be re-employed on or after the date the employee attains the specified age.

Why wouldn't an employee want the prescribed retirement age to be extended?

In some other countries, people start receiving their pensions on reaching their retirement age. That's why raising the retirement age is met with protests.

Here, raising the prescribed retirement age does not affect the age at which a Central Provident Fund member can withdraw his excess CPF moneys.[6]

Neither does it affect the age at which an automatically-included CPF Lifelong Income Scheme member can start receiving payouts.[7]

Raising the retirement age may affect younger members of Supplementary Retirement Scheme: half the withdrawals from their SRS accounts are deemed to be income chargeable to tax only after they have attained the prescribed minimum retirement age prevailing at the time when they made their first contribution to their SRS accounts. Most people 50 years of age and older would already have locked in the minimum retirement age.[8]

The survey seems to be a waste of resources.

Notes

1. Most Singaporeans aged 50 and above support raising re-employment and retirement age: Survey (The Straits Times, 24 Sep 2023).

2. Retirement and Re-employment Act 1993 (2020 Revised Edition).

3. An eligible employee means an employee born on or after 1 July 1952 and the employer assesses the employee as having at least satisfactory work performance and being medically fit to continue working.

4. An employee's specified age means the higher of his prescribed minimum retirement age (63 years of age with effect from 1 July 2022) and the retirement age stated in the employee's contract of service.

5. The prescribed re-employment age for employees is currently 68 years of age.

6. 55 years of age (section 15(2)(a) of the Central Provident Fund Act 1953 (2020 Revised Edition)).

7. An automatically-included CPF Life member can start receiving payouts any time from 65 years of age to 70 years of age and choose his or her CPF LIFE plan then. Otherwise, he or she will be placed on CPF LIFE Standard Plan and payouts will start at 70 years of age (When do I have to Choose My CPF LIFE Plan? CPF FAQs).

8. Clause 10G(3)(b) of the Income Tax Act 1947 (2020 Revised Edition).