Singapore: Lowest pensions spending in the world?

October 24, 2014

We refer to the OECD paper on pensions spending.

OECD countries’ pensions spending?

It states that “Public spending on old-age benefits averaged 7.8% of GDP in 2009, compared with private pension benefits of an average of 2.2% of GDP in the same year (in the countries for which data are available over the period 2004-10).

Public spending on old-age pensions is highest – greater than 10% of GDP – in Austria, France, Germany, Greece, Italy, Japan, Poland, Portugal and Slovenia. By contrast, Australia, Iceland, Korea and Mexico spend 4% of GDP or less on public old-age pensions.”

Singapore does not spend any money?

– As Singapore’s CPF system is essentially contributions by the people – does it mean that our government pensions spending is almost zero?

Annual contributions exceed withdrawals?

Also, annual contributions has and continues to exceed total annual withdrawals.

Implicit tax on CPF?

Moreover, we are the only country in the world which keeps excess annual returns – estimated to be about 3% – to itself, at the expense of the pension scheme’s members.

S Y Lee and Leong Sze Hian

 

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About the Author

Leong
Leong Sze Hian has served as the president of 4 professional bodies, honorary consul of 2 countries, an alumnus of Harvard University, authored 4 books, quoted over 1500 times in the media , has been a radio talkshow host, a newspaper daily columnist, Wharton Fellow, SEACeM Fellow, columnist for theonlinecitizen and Malaysiakini, executive producer of Ilo Ilo (40 international awards), Hotel Mumbai (associate producer), invited to speak more than 200 times in about 40 countries, CIFA advisory board member, founding advisor to the Financial Planning Associations of 2 countries. He has 3 Masters, 2 Bachelors degrees and 13 professional  qualifications.