Budget 2018: Why should we be productive in old age?
This year’s Budget announcement saw a S$550 million increase in health and social services spending. It sparks a long-standing debate over how the government should support the ageing population as the proportion of seniors grow. Beyond financial support, an important aspect to ageing well is mental well-being.
What we do after retirement becomes an important discussion. Retirement gives some the reason to rejoice as they look toward the end of full-time employment. For others, it means a sense of loss as they try to grapple with their self-identity and find meaning beyond their jobs.
It is a personal decision. But, it is also one that has far-reaching implications on Singapore’s society and economy. These implications are further impacted by our increasing life expectancy.
Our population is inevitably becoming a pyramid where seniors form the base and young people form the tip. Dr Phua Kai Hong, Lee Kuan Yew School of Public Policy, shared with me that the weight of supporting seniors will eventually become too heavy for young people to bear. According to a recent Institute of Policy Studies study, the ageing population will cause a drag of 1.5 percentage points on per capita gross domestic product (GDP) growth every year till 2060, if fertility rates remain at current levels.
As the number of ageing citizens grow to form a bigger percentage of our economy, the lives that they lead will play a defining role for Singapore.
How can our economy continue to support the needs of an ageing population? The government announced that taxes will be raised as spending on social services increases. While it is important to have safety nets to build an inclusive society, is it a sustainable approach to simply rely on government spending? Dr Phua believes that we need to find a better balance between financing our seniors’ needs and striving for growth. We need to implement growth-oriented policies where we nurture a pool of productive seniors. Growth-oriented policies refer to the effective allocation and use of resources to facilitate economic growth.
Toward growth-oriented policies
Some may question if we are moving towards a welfare-oriented approach in building an inclusive society. In this argument, they reference initiatives such as the Pioneer Generation Package and the increasing government budgets dedicated to healthcare.
Dr Phua believes that while many governments are torn between a populist welfare state and a market-centric approach, Singapore has managed to find a sweet spot in balancing collective welfare with a personal responsibility. The CPF system places the responsibility of saving for retirement on the seniors themselves. Singapore was a pioneer in institutionalising personal savings.
Christopher Ghee, Senior Research Fellow, Institute of Policy Studies shared in a previous interview that relying solely on individual savings to finance old-age consumption may accentuate income and wealth inequalities. Dr Phua believes that as Singapore progresses into a city with a high proportion of seniors, we should seek a balance in providing for the needs of our citizens and striving for competitive growth. To achieve this, we should look at seniors as a valuable resource that will drive our economy forward.
How do we get to becoming growth-oriented?
To become growth-oriented, Singapore needs to prepare its seniors for an ever-changing world and inculcate a culture that embraces them as we tap into their abilities.
In a series on the elderly in Singapore, Channel NewsAsia featured 69-year- old Mr Ong Hock Soon, who works as a hawker-assistant six days a week and lives in a rental flat. He had declined welfare assistance several times and said that he prefers to support himself.
A trip to any hawker centre will also reveal many elderly men and women in back-breaking roles such as cleaning tables. Some may choose to work out of self-dignity, but are these really the roles that they find meaningful in their golden years?
Dr Phua feels that Singapore needs to refine government policies for the aged who want to work out of self-dignity. Greater resources should be dedicated to retraining and finding niche interest areas so that they can contribute at a greater capacity and find fulfilment after retirement.
Alasdair Yee, program assistant at a Senior Activity Centre in Bukit Merah said, “I think the biggest issue in ageing is finding new roles after retirement. I have met some seniors who are happily engaged and volunteering, and on the other hand I have also encountered those who find themselves useless and just pass time at home. In my experience, it is quite a common challenge for the aged regardless of their financial status.”
A culture that embraces seniors
For seniors to be happily engaged after retirement, we need to build a culture that embraces them. How are senior employees treated in the workplace? There are many who expressed their concerns on ageism in the workplace. In a 2015 survey by Singapore’s Ministry of Manpower, 65% of those laid off were aged 40 and above. While there are laws in place to prevent age discrimination at the workplace, Dr Phua questions how strictly these laws are being enforced.
He also shared that while we protect our seniors, we need to enable companies to remain competitive. Dr Phua said, “There needs to be a greater balance between unions and laws. This balance will help to protect seniors’ jobs and not impede a company’s strive for growth. More flexible schemes need to be devised to enable seniors to contribute in a meaningful way to the economy without imposing additional wage costs.”
Looking at ageing differently
We may also need to change the narrative on ageing in Singapore. We need to tell more stories of seniors doing well so that we can shape the lenses in which society views seniors.
Cai Yinzhou, Founder, Cassia Resettlement Team, feels that the collective wisdom of seniors need to be better harnessed. This could be in the form of mentorship programmes where seniors take up a role in guiding the younger generation.
Barack Obama, Former President of the United States of America, said that the future belongs to the young people with an education and the imagination to create.
While there is much truth to this philosophy even in Singapore’s case, let’s not forget the seniors. If we find a way to tap on their limitless potential, we may open the door to an undiscovered treasure trove of resources that will drive the nation forward.
Christel Goh is an Assistant Manager at the Lee Kuan Yew School of Public Policy.