SINGAPORE: The Government will fund up to 75 per cent of the increase in Central Provident Fund (CPF) contributions for lower-income platform workers in the first few years, Senior Minister of State for Manpower Koh Poh Koon said in Parliament on Wednesday (Mar 1).
Starting from the second half of 2024, platform workers and platform companies’ CPF contribution rates will progressively rise over five years, at about 2.5 percentage points per year for workers and 3.5 percentage points per year for companies.
Platform workers earning up to S$2,500 per month and who increase their CPF contributions will be eligible for the transition support.
In the first year, the Government will pay 75 per cent of the additional contributions. This will be reduced to 50 per cent of the increase in the second and third years, and 25 per cent in the fourth year, which is the last year of this transition support.
MOM said more details on implementation will be shared at a later date.
The support will help ease concerns that platform workers have about the impact of the CPF changes on their take-home pay, Dr Koh said during the Ministry of Manpower’s Committee of Supply debate.
Singapore has about 73,000 platform workers, with more than 16,000 delivery riders and the remaining private-hire and taxi drivers.
Last November, the Government accepted a series of recommendations by the Advisory Committee on Platform Workers, one of which was to align the CPF contribution rates of platform workers and companies with those of employees and employers.
Platform workers who are below the age of 30 at the start of implementation
Dr Koh said the Manpower Ministry strongly recommends that older platform workers opt in to receive additional contributions from platform companies.
“Like employees, platform workers who earn between S$50 and S$500 a month will also be able to receive CPF contributions from the platform companies without having to make CPF contributions on their own,” he said.
Platform workers aged 65 and older will receive more in their overall pay package because of the companies' contributions without having to increase their own CPF contribution rates, which are lower for that age group.
Once the CPF contribution rates of platform workers have been fully aligned with that of employees, Workfare payments for these workers will also be permanently increased to match those of employees.
Introduced in 2007, the Workfare Income Supplement provides lower-income Singaporeans with cash payouts and CPF top-ups to encourage them to keep working and saving for retirement.
Currently, platform workers who earn
Platform workers also receive 90 per cent of the Workfare payouts in their CPF accounts and 10 per cent in cash.
From the second half of 2024, all eligible platform workers, whether they increase their CPF contribution rates or not, will receive Workfare payments monthly.
In the fifth year of the CPF transition, when the government funding will have tapered off, platform workers who have aligned their CPF contribution rates will receive the same amount of Workfare payouts as employees. The ratio will also be adjusted to match that of employees – 60 per cent in CPF and 40 per cent in cash.
Eligible platform workers can receive up to S$4,200 per year, an increase from up to S$2,800 per year now.
Both measures “mitigate the concerns in take-home pay while ensuring platform workers receive a significant boost in their retirement savings”, Dr Koh said.
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Starting from the second half of 2024, platform workers and platform companies’ CPF contribution rates will progressively rise over five years, at about 2.5 percentage points per year for workers and 3.5 percentage points per year for companies.
Platform workers earning up to S$2,500 per month and who increase their CPF contributions will be eligible for the transition support.
In the first year, the Government will pay 75 per cent of the additional contributions. This will be reduced to 50 per cent of the increase in the second and third years, and 25 per cent in the fourth year, which is the last year of this transition support.
MOM said more details on implementation will be shared at a later date.
Related:
The support will help ease concerns that platform workers have about the impact of the CPF changes on their take-home pay, Dr Koh said during the Ministry of Manpower’s Committee of Supply debate.
Singapore has about 73,000 platform workers, with more than 16,000 delivery riders and the remaining private-hire and taxi drivers.
Last November, the Government accepted a series of recommendations by the Advisory Committee on Platform Workers, one of which was to align the CPF contribution rates of platform workers and companies with those of employees and employers.
Platform workers who are below the age of 30 at the start of implementation
Dr Koh said the Manpower Ministry strongly recommends that older platform workers opt in to receive additional contributions from platform companies.
“Like employees, platform workers who earn between S$50 and S$500 a month will also be able to receive CPF contributions from the platform companies without having to make CPF contributions on their own,” he said.
Platform workers aged 65 and older will receive more in their overall pay package because of the companies' contributions without having to increase their own CPF contribution rates, which are lower for that age group.
RISE IN WORKFARE PAYMENTS
Once the CPF contribution rates of platform workers have been fully aligned with that of employees, Workfare payments for these workers will also be permanently increased to match those of employees.
Introduced in 2007, the Workfare Income Supplement provides lower-income Singaporeans with cash payouts and CPF top-ups to encourage them to keep working and saving for retirement.
Currently, platform workers who earn
Platform workers also receive 90 per cent of the Workfare payouts in their CPF accounts and 10 per cent in cash.
Related:
From the second half of 2024, all eligible platform workers, whether they increase their CPF contribution rates or not, will receive Workfare payments monthly.
In the fifth year of the CPF transition, when the government funding will have tapered off, platform workers who have aligned their CPF contribution rates will receive the same amount of Workfare payouts as employees. The ratio will also be adjusted to match that of employees – 60 per cent in CPF and 40 per cent in cash.
Eligible platform workers can receive up to S$4,200 per year, an increase from up to S$2,800 per year now.
Both measures “mitigate the concerns in take-home pay while ensuring platform workers receive a significant boost in their retirement savings”, Dr Koh said.
Continue reading...