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SINGAPORE: The GST hike and the plight of low income workers came under the spotlight again in Tuesday's session of the Budget debate.
Labour MP Halimah Yaacob said these workers need a retirement income the most. Yet under present policies, they are the ones least likely to be able to save for their retirement.
For instance, lower CPF contribution rates for older low-wage workers under the Workfare Income Supplement was meant to make them more employable and raise their take-home pay.
But this means they have little CPF savings to meet the Minimum Sum of $40,000 to join the CPF Life Scheme.
MP Halimah said: "I understand that it is a perennial issue of balance - between fulfilling today's needs and saving for tomorrow. But it also shows that while a defined contribution retirement scheme has generally worked for us, moving ahead, there are difficulties with such a scheme because there is very little social risk pooling. I urge the government to pay attention to the retirement needs of low income workers as they are the ones that need a retirement income the most but under the present policies are the ones that are less likely to be able to save for their retirement."
Like Mdm Halimah, MP for Ang Mo Kio GRC Lee Bee Wah also called for more to be done for older women who may not have accumulated enough CPF savings to take part in CPF Life.
She also called for the government to consider lowering the income tax rate to 15 per cent so as to help Singaporeans cope with the cost of living and to also attract foreign talent.
But she praised the Budget for being a 'bountiful' one, in particular, the scrapping of estate duty, increased education funding and incentives to encourage more R&D investments by companies.
Mdm Halimah too noted that the most important part of the Budget is the investments the government is making in the people.
To that end, she also urged the government to consider giving every Singaporean an Individual Learning Account which they can use to upgrade themselves.
This can be topped up every year if there are Budget surpluses.
Tuesday's session also saw some MPs calling again for a cut of the GST, given the Budget surplus.
MP for Marine Parade GRC Dr Ong Seh Hong said the government should not encourage the wrong expectation among Singaporeans that a Budget surplus means more 'hongbaos'.
Instead, he said, they should be looking at how the Budget can 'maintain the country's competitiveness'.
He added that he supported the Finance Minister's policy of keeping the Budget 'prudent, pragmatic and forward-looking'.
Finance Minister Tharman Shanmugaratnam will be responding to the MPs in Wednesday's session. - CNA/ir
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