1 Singapore’s Changing Age Structure: Issues and Policy Implications for the Family and State Angelique Chan Department of Sociology National University of Singapore

2 Singapore’s Demographic Dividend The post WW2 baby boom cohort and the State’s rapid march through the demographic transition, produced a demographic dividend for Singapore. The late 1970s and the 1980s were characterized by very high levels of economic productivity as Singapore capitalized on a large work force (the baby boomers) and enabling policies in the areas of public health, family planning, education, and the economy. The late 1970s and the 1980s were characterized by very high levels of economic productivity as Singapore capitalized on a large work force (the baby boomers) and enabling policies in the areas of public health, family planning, education, and the economy.

3 Singapore’s demographic transition In the late 1950s, Singapore’s Total Fertility Rate (TFR) was 6 children per woman. By 1975, efficient family planning policies achieved a TFR below replacement level of 1.9. Current TFR is 1.26 (2004). Pro-natalist policies having little effect.

4 The closing of Singapore’s demographic window of opportunity Singapore’s population is aging rapidly. At present, life expectancy is 76.9 for men and 80.9 for women (2003). Currently 7% (235,000) of the population is aged 65 and above. By 2030, increase to 19% (796,000). Old age dependency ratio will increase from 1:10 to 3:10. Appropriate policies must be put in place before the demographic window closes.

5 What has Singapore done? Since 1982, the Government has been aware that an aging population will pose social and economic issues. Various policy recommendations implemented, e.g., changing the Central Provident Fund (CPF) contributions for older persons, legislation on minimum standards for old age homes, increasing elderly dependants’ tax relief, legislation on filial piety. On 1 st January 1999, retirement age changed from 60 to 62.

6 Most recently In 1998, Inter-Ministerial Committee on Aging (IMC) formed to address six main areas: financial security, employment, housing, health, social integration, and cohesion and conflict. I discuss what policies the government has in place to prolong the demographic dividend or reduce the negative impacts of population aging as the demographic window of opportunity closes. My focus is on financial security, employment, living arrangements, and health.

7 Financial Security Central Provident Fund established Mandatory, individual save-as-you-go scheme. Special (retirement) account: minimum sum, $80,000 (as of July 2003). Yields monthly annuity of $613. CPF has highest coverage of any retirement plan in Asia Highly efficient savings mechanism for Government. Contributes between 16% and 30% to gross national savings rate. Only 24% of individuals in 1999 can meet minimum sum after withdrawals for housing, investments, and other schemes (e.g., children’s education).

8 Most older Singaporeans have little or no CPF savings

9 Old age and economic security Today, most older adults (59+) rely on children for financial support: 79% Chinese 79% Chinese 63% Malay 63% Malay 44% Indian 44% Indian Government policy: Old age financial security is an individual responsibility. Family expected to care for older members who cannot care for themselves. 1996: Parental Maintenance Act.

10 Family under stress Policies to assist families to take care of older adults financially need to be set in place. Increasing longevity, delayed childbearing, lower fertility, and increasing rates of non-marriage, create a situation where middle-aged adults are stretched financially and emotionally to care for older parents and young children. Unmarried adult children hard pressed to provide financial security and care to older parents.

11 Recommendations of the IMC A basic needs CPF model Basic living expenses, medical and housing needs Basic living expenses, medical and housing needs Step up contribution rates for the Special account Step up contribution rates for the Special account Opportunities to remain employed Allow private sector financial investment Strong public education program “Take Charge, Start Early.” “Take Charge, Start Early.”

12 Employment Data from 1999 show 16% of older adults (59+) employed, and 5% looking for work. Older males are 3 times more likely to work compared to older females. Older adults continue working to continue an active life (28%), to combat boredom (26%) or because of financial need (25%). Older workers face employer discrimination in hiring.

13 Foreign talent As Singapore’s old age dependency ratio rises, recruiting foreign professionals to meet shortfalls in manpower. Currently make up 9% of the professional workforce. Between 1991 and 2000 contributed 37% to Singapore’s gross domestic product. Foreign professionals often granted permanent residence to maintain population levels and boost human resource productivity. Response of local population mixed. Public concern about growing competition for diminishing numbers of jobs.

14 IMC recommendations on employment Policy: Help older Singaporeans to remain employable by: Retraining Retraining Educating employers and employees Educating employers and employees Provide information, training, and job placement services Provide information, training, and job placement services Increase employment opportunities, e.g., promote flexi-time, part-time work. Increase employment opportunities, e.g., promote flexi-time, part-time work.

15 Living arrangements Singapore has one of the highest co-residence rates in Asia. In 1999, 78% of older adults (60+) live with at least one adult child. Government policies encourage co-residence both as a moral obligation of adult children to older parents and an attractive financial arrangement. Co-residence thought to promote older adult well-being.

16 Living arrangements, by type among Older Singaporeans (59+) in 1999

17 Living arrangement policies Policies to encourage co-residence include tax incentives and priority housing. Recently, government has focused on creating more housing options for older adults who choose to live alone or with a spouse only, e.g., studio apartments in HDB estates that have been retrofitted with elder-friendly features (such as non-slip flooring, wheelchair access). Government promotes “aging-in-place.”

18 Will the high levels of co-residence in Singapore last? Consistent and far-reaching government programmes encouraging family support, in addition to high housing costs and lower marriage rates may result in the maintenance of high co-residence levels. However, co-residence should not be equated with older adult well-being. Need to understand what is going on within the household. In many cases, older adults are living with children because their children have not yet moved out of home.

19 Health Care Most older adults (60+) have medical insurance accounts (Medishield), however, the amounts in these accounts vary widely. Older Singaporeans are on average in good health; 50% report good health, 37% report fair health, and 13% report poor health. Rates of functional disability (in Activities of Daily Living) range from 4-10% depending on the age group. Hypertension is the main reported chronic health problem.

20 Recent policy initiatives Eldershield. Develop private nursing homes Develop multi-task care staff Harness VWOs to provide more care.

21 Specific attention needs to be paid to: Gender differences in health status, approaches to preventive medicine, and health-seeking behavior. E.g., women suffer from more chronic diseases and are more likely to seek medical treatment compared to men. Ethnic differences in the above. E.g., older Indians are significantly more likely to report poor self-assessed health and at least 1 chronic condition compared to older Chinese. Older Malay women are least likely to report a chronic condition or a functional disability compared to older Chinese women.

22 Conclusion Singapore’s rapid demographic transition and the demographic dividend it produced spurred the State’s economic development. Today, as Singapore’s population ages, increases in the old age dependency ratio could hamper economic growth. Population aging also poses extreme challenges to families charged with caring for older adults.

23 Employment and financial security Employment: Government policies to extend the number of years an older person can remain employed may lower the old age dependency ratio. Financial Security: Similarly, policies to increase individual financial security in old age may decrease the level of dependence of older adults on family members and society.

24 Living arrangements and health Living arrangements. Expanding housing options for older adults while continuing to promote co-residence may enhance family support. Health. Policies to cater for increasing health care costs at older ages, such as Eldershield, may better prepare older Singaporeans to meet their health care needs over time and decrease reliance on family members.