Singapore’s retirement age will be raised from 63 to 64 on July 1, 2026, providing workers who wish to continue working with extended protection, according to Minister for Manpower Tan See Leng. The re-employment age will also be increased from 68 to 69. Companies will be required to offer eligible staff re-employment until the new age, with adjusted terms if necessary, or employment assistance as an alternative. The decision, which was reached through consensus among the Ministry of Manpower, unions, and employers, comes after the Government’s previous announcement in 2019 that the retirement age would be raised to 65 and the re-employment age to 70 by 2030.
The timeline for implementation was determined in response to calls for businesses and workers to have sufficient time to prepare. The move aims to address current challenges in the labor market, including falling birthrates and an ageing population. Minister Tan emphasized the need to sustain productivity over the next decade to avoid economic decline.
To create fairer workplaces and attract more individuals to the workforce, the Manpower Ministry will adopt a multi-pronged strategy. Legislation expected to be introduced in 2024 will discourage discrimination based on age, race, and disability and provide greater protection for platform workers. Additionally, guidelines for flexible work arrangements between employees and employers will be published this year.
Minister Tan highlighted the importance of assisting employers in job redesign and employee training. The establishment of four new jobs transformation maps, including generative Artificial Intelligence and sustainable finance, will aid businesses by mapping out new career pathways. Under the Career Conversion Programmes, employers will also receive increased payroll support, with maximum salary support for mature or long-term unemployed workers raised to $7,500 per month and $5,000 per month for other CCP participants.
Furthermore, efforts are being made to address the underrepresentation of Singaporeans in global corporate leadership roles. The Workforce Singapore agency will support the Overseas Markets Immersion Programme, enabling local employees to gain international experience through overseas postings.
To assist jobseekers who face repeated rejections, a financial scheme is being developed to provide temporary support during their job search. Plans to professionalize skilled trades, starting with electricians, are also being explored. However, there are no current plans to legislate retrenchment benefits for specific trades, as this could pose risks to financially disadvantaged businesses.
Responding to concerns about retirement adequacy, Minister Tan highlighted positive trends in CPF savings, with over 70% of active CPF members having set aside the Full Retirement Sum by age 55. Various schemes and top-ups have been introduced to boost retirement savings for older, lower-wage workers, homemakers, and caregivers. Minister Tan emphasized that the CPF’s purpose is for retirement, housing, and healthcare.
Lastly, Minister Tan addressed the closing of the Special Account (SA) for workers aged 55 and above. Despite protests, this move will only affect around 8,400 members, less than 1% of the affected population, who will not be able to fully transfer their SA savings into their Retirement Accounts (RA). Close to 720,000 CPF members have withdrawable balances in their SA, with a median balance of approximately $2,000. Minister Tan noted that the difference in interest rates when moving these funds to the Ordinary Account (OA) is approximately $3 per month, and assured that the OA interest rate will be reviewed periodically.
In summary, the increase in Singapore’s retirement age and re-employment age aims to provide longer statutory protection for workers who wish to continue working. The move is part of broader efforts to enhance the employability of local workers, ensure retirement adequacy, and create fairer and inclusive workplaces. The Singapore Government is taking measures to support businesses in job redesign and employee training and is exploring ways to boost CPF savings and enhance global leadership opportunities for Singaporeans.
