SINGAPORE - The labour movement has called on the Government to raise the Central Provident Fund (CPF) rate for workers in the 50-55 age group in the upcoming Budget, which will be announced on Feb 21.
The National Trades Union Congress (NTUC) hopes the CPF rates will go up by one to two percentage points, bringing it closer to that of younger employees.
Currently, the CPF contribution rate for workers aged 50 to 55 is 32.5 per cent, with employers contributing 14 per cent and workers 18.5 per cent.
The rate for workers in the 50-and-below age group is 36 per cent, with employers contributing 16 per cent and employees 20 per cent.
NTUC said that narrowing the gap would help workers save more for retirement and health-care expenditure.
NTUC deputy secretary-general Heng Chee How said at a press conference on Wednesday that the tight labour market conditions and better bargaining power of workers makes it a good time to raise CPF rates.
NTUC wants employers to contribute at least one percentage point of the increase it is seeking in the coming Budget.
The lower contribution from workers - if they have to contribute at all - should go into the CPF ordinary account.
This is to ensure that the increase would not affect their cash flow and ability to meet housing payments or fund their children's tertiary education.
Mr Heng said there is also a need to do a review on overall CPF rates of workers across different age groups to ensure that Singaporeans are well-prepared for retirement.
The last time that the Government set out long-term targets for CPF was more than a decade ago - in 2003.
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