Tan Kin Lian / Columnist
Prime Minister Lee Hsien Loong spoke at the Reinventing Retirement Asia Conference organised by the Council of The Third Age. He urged “no let up in keeping seniors at work”. He said that outmoded social attitudes and systems have to change, and that seniors should continue to work beyond the customary retirement age.
I agree.
Less energetic
Older people should continue to work, if they are productive and useful. But we have to recognise that they are less energetic, slower and more likely to fall sick. They cannot be expected to work as productively as younger people.
Older people should be allowed to work at a slower pace and part time, and to earn a proportionate wage. If their wages match productivity, it is likely that employers will continue to engage the older workers – as they bring the benefit of experience, lower training cost and greater stability in the workforce.
Fair wages
But, the older workers should not be exploited. They should be entitled to a fair wage for the work that they put in. Left to fend on their own, the seniors will be exploited by the market. If employers can get people to work at lower cost due to their desperate situation, the wages of seniors will stagnate or drop.
The trade union movement can, and should, take a stronger stand to get a fair deal for the older workers. Most of these workers were formerly the members of the trade union. There is little that the movement can do if it continues to believe that wages should be left to market forces.
Individual workers will continue to be weak. That is why they need a trade union to help them get fair wages through collective bargaining. There is a role for the trade union movement to play a more active role.
Saving for retirement
A better protection for the older workers is financial independence. During their working life, they should set aside sufficient savings to meet their financial needs during retirement.
If they have sufficient savings at the customary retirement age, they are financially independent. They do not have to work if they do not get satisfactory working conditions and wages. These people can continue to work for pleasure, to keep active, and to benefit society. A supplementary income is a bonus.
Unfortunately, many of our older workers are not financially independent. They are not able to save sufficiently or to invest their savings wisely during their working life.
The wages of our lower income workers are inadequate and had stagnated during the past decade. This is due to the absence of a minimum wage policy, a pro-business environment and reliance on market forces. It has led to a widening of the income gap. The fruits of economic growth are not fairly shared among the population, leaving people at the lower income groups in a worse position.
The cost of living increased significantly during the past decade. Although the official statistics calculated inflation at a modest level of 2 percent for most years, the actual inflation rate felt by most people were much higher, as they see it daily in the consumer prices, taxes and levies. The inflation rate escalated to 7 percent in 2008.
High cost of living and inadequate wages result in less money available to be set aside as savings for the future. Many people reduce their savings due to this squeeze.
Poor return on savings
The return on savings has been poor. For risk-adverse savers, the interest rate on bank deposits dropped to below 1%, which was grossly inadequate to cover the actual inflation rate.
Those who invested in life insurance and structured financial products received a poor return relative to the risk. The financial institutions were able to take away a large margin on these products to earn a big profit. In good years, these products gave a modest return to the investors. In bad years, the investors suffered the full impact of the losses. The investors have also been exploited by the market.
During the global financial crisis, more than 10,000 risk adverse investors had their hard earned or life savings completely wiped out on their investments in the credit linked notes, which were marketed to them as safe investment products. These investors were not risk takers, as they were not given a high return on these notes. To earn a modest return of 5%, they had to lock up their savings for 5 years.
Disappointed seniors
It is a bad mark on Singapore’s success story that so many seniors do not have sufficient financial security, in spite of a lifetime of hard work and prudent savings.
This is directly attributed to the economic strategy of reliance on the free market and inadequate protection for workers and consumers.
It is quite sad that many seniors have to work to earn a low income just to survive. They have to work hard and long hours, in spite of their weakened health. Apart from the low wages, they have to suffer indignity as well.
The Prime Minister quoted the example of hotels favouring older women attendants to clean rooms. But they tend to drop out due to pressure from their children. “This is a delicate matter of face and status,” the PM said.
There is no need for people to suffer indignity, if they receive fair wages. If the room cleaners are given adequate wages, they will have greater dignity and will even receive the encouragement of their children!
In some countries, refuse collectors earn more than office workers. If this situation applies in Singapore, there will be no shortage of locals wanting to work as refuse collectors.
Positive Government policies
It is time to review this failed strategy – which has resulted in many seniors facing the financial insecurity of retirement.
We need positive Government policies to make a change to improve the lives of the working people. They need to have fair wages and a fair return on their savings.
We need stronger regulations, trade unions and consumer associations to safeguard the interests of workers and consumers in the free market environment.
Tan Kin Lian
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y cant we go back to pension scheme like the past?
i tink the elderly shld b allow to sit back and relax in their golden years. is it fair to encourage the elderly to cont working aft 65?
i saw this report here:
http://theonlinecitizen.com/2009/01/singaporeans-ranked-lowest/
it seems that CPF is not enough…something is not right w our CPF and govt shld review n rectify its policies in order for plp to retire ‘deservingly’ when they are old. unless its the elderly’s choice to cont working for their own enjoyment.
Agree with most of what you share here Mr Tan. Only I have a niggling feeling about unions being the cure all and solve all-. I came across this great article Mr Tan. Pls do read it and give us your opinion.
http://dotseng.wordpress.com/2009/01/10/ah-kong-ah-ma-are-going-back-to-work-the-great-
The writer seems a bit idealistic, but what he says seems to make sense. For your information.
Nice site! bye
Loyalty is a “very cheap words” nowsdays. Who pay you higher, you go and prositute yourselves to them to meet end needs. That is life in Singapore, aren’t we rule by money, control by money and why foreigner came to Singpore cause of money. Do you think they are loyal, don’t be stupid!!!
But pls believe in fair competitions, so everyone of us will do our best at the lowest possible costs. Prices are always guide by the Power of Demand and Supply and this forces is almost equivalent to God’s Power.
Pls comment if you think otherwise!
If I were a company and is told to re-employ or extend their retirement to 65, then I will consider relocating and getting younger and cheaper labour!…………let the older ones retire gracefully, as with modern day stress will take a toll on older workers that are slow, aging and sometimes can be useless (sorry if it is too strong a phase)….By extending or employing older workers, the young and mid careers employees chances of advancement/promotions will be stifled and surely, some will run away so who is going to help us?…..maybe relocate to Vietnam, Laos and Mynmar all promising markets.
With today’s high demand from companies like “MULTI-TASKING” etc. so where does UNION define what is to be done and not to be done or is it all yes-man!
Ah Kong and Ah Ma will be exploited in that sense ! I’ve seen an old female Cleaner worker in her 60′s in my condo….slightly handicapped and limping, was working tirelessly until she fell and was terminated!
old need to work to survive due to high costs of living, most of which are directly caused by fees, exorbitant utiliities, transport, rents, etc. they want their cpf nest egg but denied. every once a while they throw a few crumbs in form of workfare.
when the top makes noise to tell people to work longer, the actual minions are busy at telling those reaching retirement age – we will cut your salaries and you are entirely at our mercy whether or not to re-employ you at our terms. fair?
or else they are letting in anybody skilled or unskilled to replace you with cheaper wages and forced to work bucket shop hours. then they are holed up in hole of calcutta until one died from chickenpox. of course MOM is not aware of all these abuses.
Many older people, who lost their previous jobs, find it difficult to get another full time job. They should consider working part time, and close to their homes.
I carried out a survey in my blog. Many people replied that part time job is an interesting option. They are willing to try out a part time job paying an hourly rate.
The survey results are shown here:
https://www.blogger.com/comment.g?blogID=11702093&postID=7496499617035387583&isPopup=true
I will be getting someone to develop an internet portal to help people to find part time jobs near their homes. The employers should also consider this type of flexible work force, with a competitive wage structure. The employer will not be burdened with a fixed cost.
After working part time, the older worker may be offered a full time job by the employer, if there is a good fit.
Prime-Aged Citizen Mr Lee Tock Kong spoke at the Reinventing Fair Renumeration Asia Conference organised by the Council of The The Wise. He urged “no let up in paying the seniors fair renumeration so as to keep them at work longer and retire with dignity when they finally have to retire”. He said that outmoded social attitudes and systems have to change, and that seniors should continue to be paid fair and equitable wages for their contributions and work no matter whether they have past their customary retirement age or not. He added that two good examples are MM Lee and President Nathan, who are well rewarded with the world’s highest salaries and perks for their continued contributions beyond their retirement age, while at the same time still enjoy drawing their pensions happily.
Lee Tock Kong, PPA (Pegawai Pandai Angkat )
Prime-Aged Citizen of Sin City.
In Marriage the Church couple take the Marriage Vow like ……”For better or for worst…blar blar blar…..till death do us part!
Now in Working Life, we cannot chose to retire when a mandatory Act is enforced to work till 65 and some may say……….I’ve no choice but to work until death do us part?
I agree that with the topic of that article, i.e. we should continue to better take care of senior citizens. I prefer funding them through better social welfare policies.
This is my current thinking:
Minimum wage
a) Firstly, I’m guessing that it is not so much of an issue that the wages of senior citizens are “unfairly suppressed”. By unfairly suppressed, I mean whether they are paid below the market rate. So in terms of economic distribution, the situation should be already fair generally. Another way of looking at it is that if there is a shortage of senior citizens workers.
b) Rather, the issue I believed is that although the wages are at market rate, it is considered to be lower than what is desired, i.e. it is a social welfare issue, not an economic profit redistribution issue.
c) It may seem that pro-business policies is at fault. But to artificially suppress pro-business policies to give senior citizens a wage advantage above the market rate is to upset economic balances. By pro-business policies, I do not mean policies that give companies an advantage; rather I mean policies that creates a more “efficient” market place, i.e. there is no option that can benefit both producers or CONSUMERS.
d) Imposing a minimum wage may create market inefficiencies, i.e. either companies or consumers absorb the cost. Of course, the impact might not be much. If it’s not much, then it is an effective policy which is also easy to implement. But we probably need actual and local statistics make the case more convincing. Internationally, it is still controversial among economists, so information another country is probably not very useful.
e) Suppose now we agree that senior citizens are given their fair economic share of profits but lacking in social benefits. I personally rather made up using a better social welfare policy which can come in both monetary and non-monetary forms. This I believe is also more transparent.
f) Also, i also hope that we can ease the social stigma of working “after retirement”. Senior citizens should not need to work to survive, but choosing to work should not be associated with disgrace.
Pro-business policies and social welfare
g) I prefer separating economic polices from social welfare policies. I prefer policies which generate as much fair economy activity as possible. Fair as in fair to both businesses and consumers. Then, tax the economic activities to redistribute social welfare to senior citizens. I think this is more transparent, and it can be done without conflicts.
h) In other words, I think we should create an environment that businesses like to stay because they make profits, and consumers are happy because they are getting what they want at the lowest possible price. And corporate and personal income taxes, GST, and other taxes are used to fund social welfare. In this way, we can narrow down the discussion to one place: social welfare policies.
I agree that with the topic of that article, i.e. we should continue to better take care of senior citizens.
Generally, I don’t think (except in some specific cases) senior citizens are economically exploited per say. I think the problem lies in that even though being paid at “fair market rates” and working very hard, it may not be enough for them to sustain a “desirable” standard of living. The direct reason is that, for some of them, the total economic production throughout their lives could not accumulate enough wealth (which is not a disgrace).
“Pro-business” policies are not at fault. By pro-business policies, I do not mean rules that give businesses advantage. What I mean is policies that create a more “efficient” market, to both businesses and CONSUMERS. I don’t think it is productive trying to blame anyone. Rather, they need more social welfare support. It’s a question of where the money comes from and how best to use it.
In other words, I think we should create an environment that businesses like to stay because they make profits, and consumers are happy because they are getting what they want at the lowest possible price. And corporate and personal income taxes, GST, and other taxes are used to fund social welfare.
WIth a separation of economic and social welfare policies, the channel to help senior citizens becomes more direct and transparent. So, all discussions can be focus on getting more budget (from tax revenue) or formulating better policies to better utilise the funds. This makes discussion less complicated.
I agree that with the topic of that article, i.e. we should continue to better take care of senior citizens.
Generally, I don’t think (except in some specific cases) senior citizens are economically exploited per say. I think the problem lies in that even though being paid at “fair market rates” and working very hard, it may not be enough for them to sustain a “desirable” standard of living. The direct reason is that, for some of them, the total economic production throughout their lives could not accumulate enough wealth (which is not a disgrace).
“Pro-business” policies are not at fault. By pro-business policies, I do not mean rules that give businesses advantage. What I mean is policies that create a more “efficient” market, to both businesses and CONSUMERS. I don’t think it is productive trying to blame anyone. Rather, they need more social welfare support. It’s a question of where the money comes from and how best to use it.
In other words, I think we should create an environment that businesses like to stay because they make profits, and consumers are happy because they are getting what they want at the lowest possible price. And corporate and personal income taxes, GST, and other taxes are used to fund social welfare.
WIth a separation of economic and social welfare policies, the channel to help senior citizens becomes more direct and transparent. So, all discussions can be focus on getting more budget (from tax revenue) or formulating better policies to better utilise the funds. This makes discussion less complicated.
(Note: I have to use another nickname, because my comment, exactly duplicated above, is in moderation. I don’t know if TOC blacklisted me, but I don’t see anything wrong with my comment)
Many jobs available to the oldies are actually physically not suitable for them.
Besides general cleaning, those hotel room cleaners need to change the bed sheets of at least 10 rooms per shift. Anyone know the weight of an eight inches thick Q-size mattress?
It is also heart aching to see fragile elderly workers (some as old as 70) washing slippery toilets, clearing crockery, doing over night guard duties etc.
It is not purely because of “face”that many people disapproved of their parents doing the above works
Where is Job safety in Old Age?……………surely as one ages, safety is of paramount importance and must be upheld.
We are the babyboomers born in the early to mid forties and at that point in time age 55 was the norm to retirement……..no questions asked or ever discussed to work beyond…..and it seems that it turn out to be that way whereby 3 of my so called friends passed away at age 65…..so I wonder how to continue working till age 65….it is a touch and go age? Irrespective of what salary is offered as everything has got it’s shelf life or EXPIRY Date!
With unemployment reaching dizzy heights, who on earth wants to employ older workers???………let the young be employed first thing first and older workers take a back seat as things are not looking bright these days
The New World Order “Work Till You Drop Dead”……………….all due to World Financial Woes! Never trust anyone but your survival instinnct and save for the rainy day