 |
|
|
|
|
|
They should get a Life too
|
|
|
Tue, Feb 19, 2008
The Straits Times
|
|
|
|
|
|
TH | E retirees' annuity scheme, now named CPF Life, is all but cemented into place. But it still is chastening for the Government that it can provide extended old-age protection only for a section of the population. The million-plus CPF members who are above 50 this year, and who fall outside the scheme's actuarial scope, have the option of signing on. Those who are not much older than the mid- to late-50s and who have an adequate Minimum Sum are wise to opt in. The Life Bonus granted in the Budget last week is a modest stimulus, but an incentive nevertheless. But 50-somethings of the lower middle income rung are not the only problem group. The challenge comes with two groups of low-wage and casual workers: Those of qualifying age but whose Minimum Sum is much less than the $40,000 considered viable to get on the scheme; and the large number of self-employed and part-time workers who earn occasional income. CPF participation for these is patchy, via Medisave. The first group comprises under 10,000 persons but the second group is large, at about 100,000.
There are few options the Government has available with which to 'graduate' large numbers of them to CPF Life. Those marginals who would be within striking distance of the $40,000 qualifying amount by age 55 in 2013, when the scheme starts, are being helped by way of the Life Bonus. Other forms of support are possible but the Government would not want to cause undue resentment among taxpayers by offering endless giveaways. Manpower Minister Ng Eng Hen was surely mindful of a different kind of moral hazard when he said last week at a briefing that self-reliance in this matter, more than monetary gifts, was the watch word. Agreed - or be prepared for another withering joke making the rounds, to the effect that being poor has its (guaranteed) privileges. Spare a thought for middling taxpayers who receive fewer state benefits yet bear the brunt of the tax-and-cost burden.
The trick is how to manage sensitively the sunset years of the 100,000-plus casuals and the self-employed. Full-time taxi drivers, who are independents and number at least 30,000, are one group ripe for a variation of CPF cover. It could be employer-paid, with the employee component made optional depending on household budgets. Improving earning power coming after the fare increases would bring more of them within the range of CPF Life inclusion. Casuals like HDB shop assistants and house help are a harder nut to crack. The concessions provided in the Budget and whatever top-ups the Government will consider offering, will not take them anywhere near eligibility. They will have to be supported via Workfare and its CPF linkage.
|
