April 23, 2013
As Singaporean Retiree Numbers Grow, Costs Become Increasing Burden
Singaporeans can now boast living the most number of years after leaving the workforce, according to the Global Sunset Index of 68 countries compiled by Bloomberg.
According to the report, 41 percent of more than 1,0000 Singapore residents surveyed by HSBC Holdings Plc said that they have not saved for retirement. It is the third-most expensive Asian city to live in and the sixth most globally, according to an Economist Intelligence Unit ranking published in February. Nearly half of its residents cite living costs as the reason for their inability to save.
“The Singapore government is one of the richest in the world but yet the people don’t feel they are rich,” according to Singaporean Richard Mui, whose career ended in 2010. At age 54, Muy cannot afford to pay his father’s medical bills. He has made S$4,000 ($3,240) in the past six months as a taxi driver, a full S$8,000 less than he made at a digital-storage device company before he was put out of a job due to a corporate takeover.
The country has enjoyed immense economic success, emerging as Southeast Asia’s only developed nation after gaining independence nearly half a century ago. Its policies have always emphasized self-reliance over state-funded welfare, according to the Bloomberg report, but Prime Minister Lee Hsien Loong is now facing pressure from the poor and elderly to increase social spending.
By 2030, Singapore’s elderly will triple to 900,000, according to the National Population and Talent Division. According to the Singaporean government, about half of Singaporeans aged 65 today are expected to live beyond 85, and a third beyond 90.
A disparity between income and retirement savings has arisen because the government has always encouraged citizens to own their own homes, pushing ownership rate to 90 percent. However, after investing the bulk of their savings into homes, many retirees struggle to make ends meet.
“It’s becoming a country where only the very rich will age in a very dignified way,” said Theresa W. Devashayam, a researcher at the Institute of Southeast Asian Studies in Singapore, who has also published papers on the nation’s policies for the elderly. “The inflation is just impossible to catch up. When you think you’ve saved enough, things keep going up and then you just find you still do not have enough.”
Singaporean Kwan Fook Chuen, who is forced to work two cleaning jobs from 8 a.m. to 1 p.m. to make S$74 a day, is “among the worst off in a system that emphasizes self-reliance,” according to the report. He is a former drug addict who is currently battling prostate cancer, but must make enough to afford rent and medical bills.
“The emphasis is no more on the people,” Richard Mui said. “I feel that the government is not improving our lives.”
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