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28 Dec 2019  (1051 Views) 
Ministry of Manpower

CPF contribution for people above 55 years
The govt is now in a dilemma. A few years ago, they reduced the CPF contribution for older worker, so that they are not too expensive for employers.

Later, they found that the older workers are not saving enough CPF for their retirement. The govt wants to increase their CPF contribution over a period of years. The feedback from workers and employers is that this will make older workers too expensive and lead to their retrenchment, i.e. employers will replace them with younger workers. 

We seem to be going round in circles. 

What is the solution?

In my view, CPF contributions should be voluntary for workers above 55 years. This applies to the worker contribution and to the employer contribution. 

In some cases, the worker prefer to have no CPF contribution. They may need all their earnings for their current needs. The employer may need to reduce their wage cost. 

Sure, this is bad for the worker's saving for retirement. But they should be saving during their younger years (and not over-spending the CPF for health care and housing). After 55, it should be voluntary.

It may lead to inadequate CPF savings for these workers. This is unavoidable. If wages are inadequate, the workers should not be forced to save for retirement. They need all the cash now.

The govt has to find some other way to take care of old people with inadequate savings. Forcing them to contribute to CPF based on low ages is not the answer. 

Do you agree with me?

Tan Kin Lian 

Vote - CPF should be voluntary for workers above 55 years old.

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