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Asia is rapidly ageing and there is a need for governments to adjust social security expenditures accordingly to facilitate better management of socioeconomic shocks by the individual/household and society as a whole. This article examines the ageing and retirement arrangements in Singapore and argues that they provide a very limited ability for the individual/household to mitigate the effects of an adverse socioeconomic shock. A major contributor to this is the limited social risk pooling resulting from a continued focus on mandatory savings to a defined-contribution scheme for ageing and retirement-financing needs, age and gender biases in existing policy designs, and low real rates of return to mandatory savings balances. More fundamental reforms are needed if Singapore is to be able to better manage the impact of adverse socioeconomic shocks. This includes introducing a budget-financed universal social pension, and a realignment of the mandated returns to the contributions and balances under existing retirement financing arrangements. Otherwise, there is potential for socially-destabilizing and -detrimental outcomes to emerge in the medium- to longer-term. [ABSTRACT FROM AUTHOR]

This paper analyses the multi-pronged approach of Singapore to managing prolonged low fertility which has led to population ageing, labour force shortages, increasing elderly dependency ratios and feminization of the elderly population. This approach has emphasized high growth, and has given priority to becoming an attractive business location over providing adequate and equitable retirement and health financing; and has pursued policies designed to generate high levels of net immigration. The chosen policy priorities have created a dilemma centring on ensuring its business competitiveness on the one hand, and meeting its residents' needs and expectations on the other. In spite of a lot of measures to boost fertility levels (official total fertility rate was 1.29 in 2007, a rate at which population becomes half in 45 years), as well as high net immigration, population ageing is expected to accelerate after 2010. This, along with high income inequalities (Gini coefficient was 0.52 in 2005), will make continuation of current policy priorities even more challenging for the policy makers. While the future policy developments are difficult to predict, greater political contestability is likely to hasten the path towards policy priorities which give greater weight to the needs and expectations of the current Singapore residents, even if it leads to lower (but more sustainable and socially cohesive) growth. [ABSTRACT FROM AUTHOR]

This article analyzes Singapore's asset-enhancing policies to finance retirement. These policies have been pursued through reliance on the mandatory savings pillar administered by the Central Provident Fund (CPF). The analysis suggests that emphasizing physical assets such as housing and the inappropriate design of a preretirement financial investment scheme has created distortions in the economy, has limited policy flexibility, and has led to inadequate and inequitable retirement financing. The article suggests a shift to a multitier strategy to address the above shortcomings. [ABSTRACT FROM AUTHOR]

In recent years, insights from behavioral economics, which incorporates observed behavior of homo-sapiens into analytical framework, have been increasingly applied to a wide range of issues. This framework which borrows from psychology and other disciplines has challenged many of the explanations of human behavior based on the traditional concepts of economic rationality. This paper analyzes the relevance of such insights for retirement financing in Asia. Rapid individual and population aging have made achieving social security in old age among the major challenges facing Asia. The paper focuses on the extent to which the mandatory savings schemes, which enable retirement savings to be separated from other types of savings, and are consistent with psychological theories of savings, prevalent in many Asian countries. The paper concludes with suggestions for enhancing retirement income security in Asia. [ABSTRACT FROM AUTHOR]

This paper analyses the formal retirement protection systems in five economically successful, rapidly industrializing, and globalized economies of Southeast Asia: Indonesia, Malaysia, the Philippines, Singapore, and Thailand. It finds that while there are major differences in the formal retirement protection systems of the five countries in terms of coverage; contribution rates; scope and nature of preretirement schemes; investment patterns, practices, and performance; replacement rates; administrative and compliance efficiency; and regulatory structures, the main common feature (with the exception of the Philippines) is aversion to social insurance and predominant reliance on individual provision through publicly mandated and managed provident funds. While these systems do minimize the fiscal burden on the State and thereby help maintain international competitiveness, they provide socially inadequate levels of retirement protection and are weak in ensuring efficiency of the saving-investment process. Moreover, several design and institutional features prevent full realization of many of the advantages of the provident funds found in these countries. They may, therefore, benefit by following the worldwide pension reform debate more closely, particularly concerning design and institutional and regulatory structures for mandatory defined-contribution schemes. [ABSTRACT FROM AUTHOR]