March 3rd, 2015

CPF flexibility good but women still at risk

By Goh Li Sian, Research and Advocacy Coordinator, AWARE

455-old-lady-yaanWe welcome the greater flexibility for Central Provident Fund (CPF) payouts proposed by the CPF advisory panel (“Proposed CPF changes give members more control”; Feb 5).

The proposed move to a lower Basic Retirement Sum is likely to improve Singaporeans’ access to their CPF monies.

However, it does not adequately resolve the underlying issue of financial insecurity of the elderly, especially women, because CPF is still pegged to employment and the level of wages earned by a person throughout his lifetime.

Women are more likely to leave the workforce to provide uncompensated domestic and care labour. As a result, they typically earn less than men, preventing them from accumulating CPF monies.

According to a 2013 Manpower Ministry report, women constitute 65 per cent of those outside the labour force. Forty-five per cent of these women, or 312,000 people, reported that they left the workforce due to family responsibilities, including caregiving. Such women are less likely to accumulate enough CPF savings to ensure their financial security in old age.

Last month, the Association of Women for Action and Research’s recommendations for the Budget supported Professor Chia Ngee Choon’s call for a basic pension scheme that is not reliant on employment. Women who have provided unwaged labour in the home by caring for children and elderly relatives would then at least be assured of financial security in their old age.

The panel has acknowledged that this is an area of concern. It noted that those who do not meet the Basic Retirement Sum should continue to get help from the Government through schemes outside the CPF, such as the Silver Support Scheme.

The complete details of the scheme are not yet known, but it promises to supplement payouts from needy elderly people’s CPF accounts, and will be introduced more fully in the Budget debate later this month.

We hope that the Silver Support Scheme will more fully provide for the financial needs of impoverished elderly men and women which are not currently met by the CPF.

This letter was first published in the Straits Times Forum on 14 February 2015.

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