Annuities -‘Set Payout Age At 80’

Source : TODAY, Monday, October 22, 2007

But raise premiums for compulsory annuities, says Senior Minister Goh

Senior Minister Goh Chok Tong has suggested setting the payout age for compulsory annuities at 80 instead of the proposed 85.

He acknowledged that many Singaporeans are still resistant to the concept of compulsory annuities as they think they will not live beyond 85 years old.

"They are both half-right and half-wrong. It is like looking at a glass half-filled with water. Is it half full or half empty? The Government says that it is half full, but many people say that it is half empty," said Mr Goh.

A "good alternative" would be to lower the payout age, which might help more people to "overcome a psychological mental block" to the idea of compulsory annuities. But premiums will be increased accordingly.

"If given a choice, I would choose to pay a higher premium and an earlier payout age of 80. Like most Singaporeans, I am a little kiasu," said Mr Goh, who spoke yesterday at the graduation ceremony for YAH! Community College, which promotes lifelong learning.

A member of the public agreed with the idea, saying: "We don't mind paying a bit more in premium — then, we get (our payout) earlier (and) have more money to spend."

But another member of the public wanted payouts to start earlier.

Speaking on the sidelines of another event, Manpower Minister Ng Eng Hen pointed out that the possibility of a lower payout age was discussed in the recent Parliamentary debate on CPF reforms.

Dr Ng said: "People have different needs. Some people want to have a payout earlier, 80 as Senior Minister suggested, or even 75. Some people want it later, so they have less dependence on longevity insurance."

Dr Ng said the National Longevity Committee would consider the various options. Their report is expected to be out early next year.

Meanwhile, age was the last thing on the minds of the 200 senior citizens who received their graduation certificates from Mr Goh yesterday.

"I only have Sec 2 education, so taking this course is like a dream come true, like graduating from university. I'm very happy. I used to be a quiet person, but now I've learnt to socialise more," said Mr Lee Keng Seong, a graduate of YAH! Community College.

To make learning even more interesting, the college has teamed up with China's Tsinghua University of Third Age to offer exchange programmes for students.