A dialogue session on Sunday with Prime Minister Lee Hsien Loong and five ministers focused on the hows and whys of the recent CPF changes. Issues like why the interest rate hike was just 1 percentage point and why there was no opt-out clause for the annuity were brought up and addressed.
To provide life-long income to those who may live beyond 85, the government has announced plans to set aside a sum of money from each individual's minimum sum to buy into a compulsory annuity for all CPF members.
If one dies before age 85, the amount goes into the pool and the payouts for those who are still living.
However, it seems that many Singaporeans are having trouble coming to grips with the idea of living long enough to enjoy the benefits of the scheme.
Goh Aik Kiang, a grassroots leader, said: "Right now, my observation is that there is a percentage of people who don't really believe they will go beyond 85."
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Dialogue on CPF reforms focuses on whys and hows of changes
Labour chief Lim Swee Say, in typical tongue-in-cheek fashion, then tried to address the issue with what he called "his fortune-telling ability".
The Secretary-General of NTUC said: "I can tell you for sure, half of you will die before 85 - half of you will live beyond 85... what I cannot tell you is whether (it is) this half or that half."
It is the harsh reality of statistics that has prompted the changes to ensure that Singaporeans have enough funds for their retirement. But issues like the annuity have raised concerns about fairness.
Goh Keng Hwa, another grassroots leader, said: "It's likely that this programme, as it is, would result in taking away money from those who are poor and sick, and giving to the wealthy and well-to-do. The reason I say that is because people who live up to 85 and beyond are likely to be those (who are) healthy and well-to-do, people who are poor and sick are likely to be compromised, since everybody contributes."
Manpower Minister Ng Eng Hen said: "Professionals calculate which groups live longer and if they do live longer, they have to pay a higher premium. The number one rule – be fair to everyone. So if you want to be fair to everyone, then each person must put aside in the CPF savings so that if you live longer than expected, you can take care of yourself. Because if you don't do that, then those who have put enough to support themselves will have to support you – that's not fair."
To the suggestion that the government should just step in and help old people with funding when their money runs out, the Second Finance Minister said he felt that was a slippery slope.
Minister Tharman Shanmugaratnam said: "The way we are doing now – we help people build up their savings, we give them incentive to save. If you save, we will help you even more, but if we say we will promise to pay if you run out of money, then what will happen over time? People will save less because they know somebody is waiting there, a grand-daddy waiting there to pay up if you run out of money."
Re-employment beyond the age of 62 was another big issue.
Making the distinction between re-employment and simply increasing the retirement age, Mr Lim said re-employment could mean a different job with a different pay that may not be stressful for the older worker.
The scheme also had the added bonus of preventing resentment from younger workers who could climb the corporate ladder and not be blocked by older workers who would simply stay on in their positions.
Mr Lim said NTUC has been working with 300 companies over the last 18 months, and so far, 3,200 Singaporeans who have reached the age of 62 were re-employed. - CNA/so
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