Ageing demands fresh thinking on pensions
Singapore doesn't have the luxury of time as it seeks new ways to maintain living standards. How the CPF embraces investment reforms is therefore crucial.
PENSION systems always reflect trade-offs between adequacy (of incomes), coverage (of the population) and cost (to the public and private sectors). Singapore's pension system continues to stand comparison with the better systems across the world.
The Central Provident Fund (CPF) has done a very good job over the years at balancing some of these imperatives, even as it has taken on further responsibilities beyond retirement - namely for the provision of housing and healthcare.
Among the CPF's most impressive aspects are the following: high contribution rates by global standards; individuals and employers co-contributing; a self-select option to encourage individual responsibility and choice for those with larger balances; and a basic guaranteed income stream in retirement via CPF Life.
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