Manpower Minister Tan See Leng on threshold for Silver Support scheme

Key Concepts

• Silver Support Scheme (SSS): A targeted support scheme for seniors aged 65 and above with low working-year incomes and limited family/financial support in retirement. Eligibility is based on lifetime wages, housing type, and household support.
• Local Qualifying Salary (LQS): A minimum salary requirement for firms employing foreign workers, intended to ensure fair wages for local workers and prevent token salaries.
• Per Capita Household Income (PCHI): Total gross household monthly income divided by the number of family members in the household, used as a criterion for SSS eligibility.
• Majula Package: A set of social support measures including Workfare Income Supplement, Earn and Save Bonus, One-off Retirement Savings Bonus, and MediSave Bonus, aimed at boosting retirement savings.
• ComCare: Financial assistance for Singaporeans needing help with basic living needs, administered through Social Service Offices.
• Flat Types (5-room, 4-room, 3-room, 2-room): Used as a tiering factor in SSS payouts, with smaller flats generally receiving higher support.
• Fiscal Prudence & Sustainability: Principles guiding the government’s approach to social schemes, balancing support with long-term financial viability.

Silver Support Scheme & Local Qualifying Salary – Clarifications and Concerns

The discussion primarily revolves around clarifying the relationship – or lack thereof – between the Silver Support Scheme (SSS) and the Local Qualifying Salary (LQS). Mr. Muhimin Abdul Malik initially questioned whether the recent increase in LQS (from $1,400 to $1,600 in July 2024) had inadvertently pushed seniors into lower tiers of the SSS, particularly those living alone whose wages were adjusted by employers to meet the LQS requirement.

The Minister repeatedly emphasized that the LQS and SSS are distinct schemes with different objectives. The LQS aims to prevent companies from hiring foreign workers at the expense of local workers’ wages, while the SSS provides targeted support to vulnerable seniors. The Minister stated, “they are not in any way interlinked… the LQS scheme as I’ve shared earlier on is aimed at working and solving our company’s needs for foreign workers.” He confirmed that the ministry does not currently have statistics on the number of seniors potentially affected by the LQS increase falling into lower SSS tiers, as the scheme wasn’t designed to track such a correlation. Further refinements to the LQS are expected in the upcoming budget.

Silver Support Scheme – Eligibility & Recent Enhancements

The SSS is designed for seniors aged 65 and above who had low incomes during their working years and now have limited family support. Eligibility is determined by a combination of factors: lifetime wages, housing type (five-room, four-room, three-room, two-room flats), and the level of household support. Payouts are tiered based on these factors, with seniors in smaller flats and with fewer resources receiving higher payments.

In 2023, the SSS was enhanced by raising the qualifying monthly Per Capita Household Income (PCHI) threshold from $1,800 to $2,300, representing a 28% increase. This change expanded eligibility to include more seniors with lower incomes. The PCHI is calculated as the total gross household monthly income divided by the total number of family members living in the same household. The Minister assured the house that the scheme will continue to be reviewed periodically.

Broader Social Support Measures

The SSS is presented as part of a broader network of social support measures for seniors. These include:

• Workfare Income Supplement: Boosts the retirement savings of lower-to-middle income working seniors.
• Earn and Save Bonus (Majula Package): Increases CPF Life payouts.
• One-off Retirement Savings Bonus & MediSave Bonus (Majula Package): Provides additional savings in CPF accounts.
• Assurance Package: Helps offset living expenses for Singaporean households.
• ComCare: Provides financial assistance for basic living needs, accessible through Social Service Offices.

Concerns Regarding Flat Type Tiering & Future Reviews

Mr. Shond raised a concern voiced by residents: discrepancies in SSS payouts between neighbors living in different flat types (specifically, five-room vs. four-room flats). Residents in larger flats sometimes receive lower support than their neighbors in smaller flats. He suggested considering merging some flat types to ensure more equitable support levels.

The Minister acknowledged the feedback and stated that all future reviews of the SSS will consider input from various sources, including parliamentary discussions, meet-the-people sessions, and dialogues with residents. He emphasized the need to balance support with “fiscal prudence and fiscal sustainability.” The ultimate goal, he stated, is to reach a point where all Singaporeans have sufficient retirement savings, reducing the need for extensive schemes like the SSS. He noted, “I hope for the day where we have done through the collective efforts of all of us here where we have done so well, we’re able to upstream ensure that every Singaporean has enough in their golden years.”

Logical Connections

The discussion flows logically from initial questions about the interplay between LQS and SSS, to a detailed explanation of the SSS’s eligibility criteria and recent enhancements, and finally to broader considerations of social support and future improvements. The Minister consistently reinforces the distinct nature of the LQS and SSS, addressing concerns about unintended consequences of the LQS increase. The conversation then broadens to encompass the wider context of social support for seniors and the government’s long-term vision for retirement security.

Conclusion

The parliamentary exchange clarified that the Local Qualifying Salary and the Silver Support Scheme are independent initiatives with different objectives. While concerns were raised about the potential impact of LQS adjustments on SSS eligibility, the Minister assured the house that the schemes were not designed to be interconnected. The SSS remains a crucial component of Singapore’s social safety net for seniors, and the government is committed to periodically reviewing and refining it to ensure it effectively supports vulnerable retirees while maintaining fiscal responsibility. The discussion highlighted the ongoing challenge of balancing targeted support with broader economic considerations and the aspiration for a future where all Singaporeans have adequate retirement savings.