Low-income elderly to get payouts every quarter
TODAY file photo
SINGAPORE — From the first quarter of next year, eligible Singaporeans aged 65 and above will receive quarterly payouts under a new permanent scheme to supplement their retirement savings and income.
First mooted by Prime Minister Lee Hsien Loong during last year’s National Day Rally, details of the Silver Support Scheme — the latest addition to the Republic’s social security system — were announced yesterday during the Budget statement.
The scheme aims to support the bottom 20 per cent of Singaporeans aged 65 and above, with a smaller degree of support extended to cover up to 30 per cent of seniors. Eligible seniors will receive between S$300 and S$750 every three months. The average recipient will get S$600 every quarter.
About 150,000 seniors are expected to receive the payouts. An eligibility assessment will be done automatically.
A majority of those living in one- and two-room Housing and Development Board (HDB) flats is expected to receive the payouts, and a smaller proportion of those living in larger HDB flats will qualify for the scheme.
In his Budget speech, Deputy Prime Minister Tharman Shanmugaratnam noted that those who have been homemakers for a good part of their lives will qualify if their families are not well-off. He stressed that the scheme — which is estimated to cost the Government about S$350 million in the first full year of implementation — aims to supplement incomes in a “modest but meaningful way”. “It should not substitute for other sources of income,” he said, citing family support and other Government initiatives such as the Lease Buyback Scheme and the Silver Housing Bonus.
Together with Workfare, the Government will be spending about S$1 billion a year on what Mr Tharman described as a system of progressive social support. “The costs will, however, rise in the next decade as more Singaporeans turn 65, while many below 65 remain in the workforce and hence qualify for Workfare,” he added.
Mr Tharman said that along with Workfare, which tops up wages of lower-income Singaporeans during their working years, the new scheme makes up the fourth pillar of social security. The other three pillars are the Central Provident Fund system, home-ownership and the healthcare financing framework.
Mr Tharman, who is also Finance Minister, noted that Workfare similarly supports the bottom 20 to 30 per cent of Singaporean wage earners. “Silver Support is hence not only for the neediest of our elderly,” he said, adding that there is Public Assistance for the truly needy who have no other sources of support.
To decide on eligibility, the Government will look at three factors in combination: An elderly person’s lifetime wages, the level of household support he or she receives and the type of housing he or she lives in.
“We cannot look at any one of these factors on its own. For example, it would not be fair to look only at housing type ... Some seniors who live in larger flats had low wages for most of their lives and hence limited savings, and may be living with children who themselves do not earn much,” he said.
On the timeline, Mr Tharman said the Government cannot rush the implementation of “a major scheme for the long term”. “We have to properly identify those who are eligible and develop the necessary systems to implement the scheme,” he said.
The Ministry of Manpower will provide more details closer to the roll-out.
In the interim, the Government will introduce an extra GST voucher bonus this year for Singaporeans aged 65 and above living in HDB flats. This group will get an additional S$300 this year and a total of S$900. “This will be helpful to these older seniors, while we work out the details and implementation of the permanent Silver Support Scheme ... This additional payment in the meantime will cover a larger group than Silver Support,” Mr Tharman said.
READ THE FULL BUDGET STATEMENT HERE
Other documents on Budget 2015 available on the Budget 2015 website.
