SINGAPORE – Whereas Singapore’s Central Provident Fund (CPF) is among the many greatest retirement earnings programs on this planet, there is a chance to incentivize the casual workforce, similar to platform staff, to contribute extra to the scheme nationwide financial savings.
This query was raised by panelists throughout a webinar on Tuesday to debate the findings of the Mercer CFA Institute’s World Pension Index, which ranked the Republic ninth out of 44 pension programs surveyed.
In its 14th 12 months, the index put Singapore’s pension system first in Asia for 2022, adopted by Hong Kong and Malaysia. The 44 world pension programs examined for the index represented 65% of the world’s inhabitants.
Singapore’s Nationwide Financial savings Scheme, the CPF, helps three foremost wants of Singaporeans and everlasting residents: retirement, housing and medical care.
Staff pay 20% of their wage to their CPF whereas their employers pay 17%.
However, for the self-employed, together with platform staff, they solely need to put round 8-10.5% of their earnings into their MediSave accounts for his or her healthcare wants.
Ms. Joelle Fong, an assistant professor on the Lee Kuan Yew College of Public Coverage, mentioned pension programs around the globe had been confronted with the query of how one can combine the casual workforce into formal pension programs.
Talking on the Mercer and CFA Institute webinar on Tuesday, she mentioned self-employed folks could make voluntary contributions to their CPF, however questioned “how can we incentivize them to contribute a bigger proportion of their month-to-month wage within the system and belief the system”.
To this finish, Singapore is presently methods to enhance the retirement and housing adequacy of platform staff like taxi drivers, supply drivers and personal rent automotive drivers who present paid labor companies on on-line platforms similar to carpooling and meals supply apps.
A committee was fashioned final September discover methods to enhance the welfare and safety of this group of self-employed staff. It ought to make its suggestions earlier than the top of 2022.
One of many questions into account is whether or not platform firms ought to contribute to the CPF accounts of their staff.
Mr. Christopher Tan, chief govt of wealth administration and advisory agency Providend, mentioned some staff on the platform had been already struggling to make the obligatory contribution to their MediSave accounts.
He mentioned that in the event that they needed to contribute extra to their CPF, they won’t have the funds for to take dwelling for his or her day by day wants.
Ms Fong advised contemplating creating firm pension schemes to complement the CPF for these staff.
She cited Uber in Britain which has launched its personal pension scheme for platform staff, including that Seize could take into account doing the identical in Singapore.