Gaps in retirement income system cannot be fixed with small tweaks

Ng Kok Hoe of our research team is over at Academia.sg with a new post on Budget 2020. Drawing on the insights of last year’s MIS report, he asks, how well do recently announced measures address gaps in the retirement income system?

The MRSS signals a continuation in the prevailing thinking: that retirement income should come mainly from individual savings. The design of the scheme reflects an implicit diagnosis that CPF payouts are inadequate because people have the means but are choosing to save or spend their money in other ways than retirement planning.

In fact the challenges go much further than that.

For older people who are lifetime low-wage workers, there will be no spare resources for voluntary CPF savings and so no opportunity to benefit from the MRSS. Instead, they face a stark choice between planning for retirement and meeting current basic needs like housing, healthcare and food.

Head over to read the full post!