Up CPF rates? Timing is important, says MP Zaqy Mohamad
Member of Parliament for Choa Chu Kang GRC Zaqy Mohamad has welcomed the labour movement's call to up CPF rates for older workers.
However, he says caution should be exercised when it comes to the timing of its implementation and the quantum of the increase.
Mr Zaqy was speaking to 938LIVE on NTUC's suggestion to increase the CPF contribution rate for older workers by one to two percentage points this year.
While he acknowledged that this move could make older employees unattractive to employers - as manpower costs would go up - Mr Zaqy feels this concern can be mitigated.
"This is a question of tempo, of increase. It may well be something that where this is phased gradually and the impact is not going to be felt, especially when the economy is on the uptrend. If it's on downtrend, then it makes sense to give subsidies. At the same time, let's not forget the Budget has to be balanced as it also means using taxpayers' monies to subsidise the additional percentage points."
But Mr Zaqy adds that he empathises with the older workers and the increment would be helpful for them.
"We also need to look at welfare of local workers, especially senior workers who might find themselves disadvantaged - many may carry on their housing home commitments into their 50s, 60s. As you move along, there may be, in the near future, premiums we pay for using CPF, and even in old age this is where they will need their CPF savings more than ever. We are slowly reversing some of these policies to look at CPF adequacies. Some of the cuts in the past may not have worked in their favour."
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