Global Retirement Index: ST says up 1 place, but the report says down 2 places?

retirement-ahead-sign

Did Singapore fall 2 places to drop out of the top 25 in the Global Retirement Index, or up 1 place to 27th?  

I refer to the article “S’pore in 27th spot in a global index on retirement security” (Straits Times, Sep 17).

It states that “The latest Global Retirement Index, which measures indicators like health and material well-being, has ranked Singapore at 27th place – one place better than last year.”

I looked at the 2017 Global Retirement Index report and it states that “meanwhile the Slovak Republic moves into the top 25 after Singapore drops out.

Singapore declines in overall score, falling two places to 27th because of a drop in the income equality indicator within the Material Well-being sub-index”.

S’pore dropped 2 places or up 1 place to 27th?  

So, why is it that apparently the Straits Times says that Singapore is “one place better than last year” at 27th when the report says that Singapore dropped out of the top 25 to 27th?

As to “The index of 43 nations assesses factors that drive retirement security. It considers how 18 measures across four categories – health, finances in retirement, quality of life and material well-being – affect retirees.

Compiled by Natixis Global Asset Management, the index showed that among Asia-Pacific countries, Singapore registered some of the best scores across almost all indicators within the finances in retirement sub-index.

However, Singapore shows mixed results with respect to these sub-indexes. It has the fifth-highest life expectancy of all the countries studied, yet finishes second-to-last in the insured health expenditure indicator, which measures the portion of that expenditure paid for by insurance.

Its only decline was registered in the material well-being sub-index, where its performance is a story of two halves. While it boasts the highest score for two of the three indicators in the sub-index – employment and income per capita – it has the fourth-lowest score for income equality among the surveyed countries. If its score for income equality was on a par with the other two indicators, Singapore would comfortably finish in the top five for material well-being” – since there are country reports for only the top 25 ranked countries – I could not find any country report on Singapore.

S’pore not in top 25 in 3 of 4 areas?

Similarly, since only the top 25 countries are shown in the ranking table of the four areas of measurement – I could not see Singapore in three of the four areas.

For the fourth area (Finances in Retirement) – Singapore is ranked first.

The report states that “Singapore maintains its first-place ranking in the tax pressure indicator with the lowest tax burden of all countries in the GRI. It also manages top 10 finishes in interest rates, old-age dependency, bank non-performing loans and governance. Singapore sees improvements in government indebtedness and especially inflation, two indicator scores that were holding it back from pole position in the past.

The Finances in Retirement is a particularly important index, as it reflects the strength of a country’s financial system and the ability of the government to provide for its citizens in retirement. In a rapidly graying world as evidenced by the old age dependency ratio indicator, the already challenging task for a government to provide social security benefits compounds to a much more severe challenge.”

S’pore top in 1 of 4 areas because … ? 

The reasons for this top ranking may be that since the Government hardly spends any money on CPF and thus do not need to provide social security benefits – the old age dependency ratio indicator may be very low – with the lowest tax burden of all countries in the GRI – and the ability of the government to provide for its citizens in retirement is arguably not at issue, since the Government spends relatively very little to provide for its citizens in retirement.

What are your thoughts on the above?

Leong Sze Hian

About the Author

Leong
Leong Sze Hian has served as 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), invited to speak more than 200 times in over 30 countries, CIFA advisory board member, founding advisor to the Financial Planning Associations of Indonesia and Brunei. He has 3 Masters, 2 Bachelors degrees and 13 professional  qualifications.