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Single elderly households in Singapore need S$1,379 a month for basic needs: study

A SINGLE elderly person aged 65 and above, who lived alone in Singapore last year without a chronic illness required S$1,379 a month to meet basic needs. 

This is according to a study by the Lee Kuan Yew School of Public Policy, National University of Singapore (LKYSPP), released on Wednesday. 

The team of researchers, led by assistant professor Ng Kok Hoe from the LKYSPP, conducted focus group discussions involving over 100 participants from various backgrounds. Using a consensus-based methodology known as Minimum Income Standards (MIS), the groups came to agreement on how ordinary Singaporeans think about basic needs, and determined the household budgets necessary for older people to meet those needs.

Participants generated lists of items and services related to housing and utilities, things needed in a two-room HDB flat, personal care items and clothing, food, transport, leisure and cultural activities, as well as healthcare. Each item or service was included only if participants came to a consensus that it was a basic need, and could explain their reasons for its inclusion. 

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Based on the lists of items and services, the household budgets necessary to meet basic needs were: S$1,379 per month for single elderly households, S$2,351 per month for coupled elderly households, and S$1,721 per month for single persons aged 55-64, the study showed. 

Said Dr Ng: "This study reveals that ordinary members of society can come to a consensus about a basic standard of living in light of norms and experiences in contemporary Singapore. Such income standards can help by translating societal values and real experiences into unambiguous and substantive benchmarks that policy can aim for."

Generally, participants agreed that basic needs must go beyond subsistence to include one's quality of life. They also emphasised the importance of independence and autonomy, which means not being a burden to loved ones, and being able to exercise one's choice and preferences. 

"A basic standard of living in Singapore is about, but more than just, housing, food and clothing. It is about having opportunities to education, employment and work-life balance, as well as access to healthcare," the report stated. 

"This study reveals that ordinary members of society are able to come to consensus about what a basic standard of living in contemporary Singapore means. What they said about dignity, respect, social belonging and choice, as well as the items and budget they came up with, reveal norms and values held by people in our society today."

In the focus group discussions, participants also highlighted frequently that health and healthcare costs are very important to them. Nonetheless, the researchers noted that such costs may vary widely for different health conditions, and are difficult to capture accurately in a single study.

Therefore, the study focused on establishing a baseline that presumes no chronic health conditions, with the researchers noting that this presumption likely underestimates healthcare costs. 

"Future research can build on this study by comparing the individual budgets for healthy persons with that of persons with particular health conditions and additional needs," they said.

Comparing the household budgets against work incomes, the study highlighted that the median monthly work income of full-time workers aged 60 and above was S$2,000 back in 2017. This is about 1.5 times the budget for meeting basic standards of living among single elderly households. However, the researchers also pointed out that there are gender differences, with the median earnings of elderly women coming closer to the budget at just 1.3 times, compared to the 1.5 times for men.

Moreover, the report suggested that the overall picture in Singapore is one of heavy dependence on family contributions, with limited support from the state. In particular, the most common income source is adult children (78 per cent of elderly people reported such income in 2011), followed by wage work (21 per cent), and the CPF or other annuities (13 per cent). 

This raises a few policy concerns, the researchers said. "Due to rapid socio-economic development, current cohorts of older people have steep educational and skill disadvantages compared to younger workers. When work incomes and wage interventions fall short, some older people either do not have the means to ever retire or will be permanently dependent on public and informal transfers.

"Even among younger cohorts, lifetime wages can and do vary. With the widening of income inequality in Singapore over the past decades, people will become older with varying levels of savings."

They added that while CPF participation and savings are projected to increase with future cohorts, the basic retirement payment of less than S$800, even after the most recent reforms, is only about half of the household budget for a single elderly person, and falls significantly short of what is required for a basic standard of living.

Added associate professor Teo You Yenn from the School of Social Sciences at Nanyang Technological University (NTU), another member of the research team and author of the book "This Is What Inequality Looks Like": "To tackle inequality, it is critical to establish an agreed floor below which no one should fall. The MIS method can be usefully applied to generate societal consensus across a range of household types."

The study pointed out that currently, major public transfer schemes are means-tested and modest, with most subsidies being one-off for a limited period, or for limited cohorts. As such, access is not assured, the researchers explained. 

Furthermore, cross-generational family support is demographically unsustainable as the family size shrinks. This means that people will have either no, or fewer children as sources of retirement income, the researchers noted. 

"The reliance on adult children as sources of retirement income may moreover reinforce economic inequality insofar as supporting parents takes up a greater proportion of household costs for the lower and middle-income compared to theirhigher-income counterparts. This leaves less for other needs of younger households, such as children’s education."

Therefore, the researchers noted that overall, the gaps in people's capacity to meet basic standards of living must be urgently addressed so that older people in Singapore can achieve what the survey participants described as basic needs for "a sense of belonging, respect, security, and independence".