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SINGAPORE has inched up in the Melbourne Mercer Global Pension Index (MMGPI), with its score improving to grade B from C+ mainly driven by an improvement in pension adequacy.
This is attributable to an increased level of financial support provided by the government to the poor and higher level of pension assets and labour force participation at older ages.
Denmark has retained its No 1 position for the fifth year with a grading of A - which means having a first class and robust retirement income system that delivers good benefits and is sustainable with a high level of integrity.
This is followed by Australia with B+. Finland, Sweden, and Switzerland are among six countries in the B category - which means that they have a system that has a sound structure, with many good features but with some areas for improvement.
Ranking seventh globally, Singapore retains its highest ranking in Asia for the fourth consecutive year, and sees a healthy increase in both the adequacy and sustainability scores.
Its overall score rose to 67 this year from 64.7 last year, moving it closer to the A grade, which is given to pension systems that score above 80.
Still, it is work in progress for Singapore. Neil Narale, Singapore Mercer Marsh Benefits leader for Mercer, noted that while Singapore's retirement income system remains among the best in Asia and saw a significant improvement in score from 2015, it is not yet the best globally.
"Creating incentives for corporate retirement plans, opening CPF to non-residents and continuing to increase the labour force participation rate as life expectancies rise will improve Singapore's score in the future," Mr Narale said.
"However, Singapore is on the right track, having implemented enhanced guaranteed investment returns for older members and the introduction of the Silver Support Scheme to help low income retirees in 2016," he added.
The MMGPI prides itself as the world's most comprehensive comparison of global pension systems, and this year it covered close to 60 per cent of the world's population, measuring 27 systems against more than 40 indicators to gauge their adequacy, sustainability and integrity.
It included diverse countries across the Americas, Europe and the Asia-Pacific regions, this year examining Malaysia and Argentina for the first time.