During the 2016 Budget, the Silver Support scheme was unveiled
While I do applaud the efforts by the government to help the older generation cope with rising living expenses, I cannot help but feel that it is an assistance scheme not without loopholes and flawed assessment criteria.
The 3 criteria
1. Seniors who have not more than $70,000 in their total CPF contributions by the age of 55 will meet the first criterion of lifetime wages.
For those who are self-employed, they should not have an average annual net trade income of more than $22,800 when they were between age 45 and 54.
2. Those who own, and live in, a four-room or smaller Housing Board flat will meet the housing type criterion. Those who live in - but do not own - five-room HDB flats will also qualify, albeit for a smaller payout, should they meet other criteria.
3. The household support condition requires seniors to come from the bottom third of households where, on average, each member earns not more than $1,100 per month.
(taken from: http://www.straitstimes.com/business/economy/singapore-budget-2016-more-than-140000-seniors-to-get-silver-support-payouts-in)
The first criterion is a fair indicator as CPF balance would provide an initial gauge if a Senior is likely to require financial support.
Flaws of the Assessment Criteria
The second criteria of looking at housing type while good as a means of benchmark can be flawed if it does not take into consideration assets other than properties.
Criteria 3, is however, the most flawed as a yardstick for assessment. First of all, I believe that there is no law explicitly stating the conditions for household support nor parental support – in other words, the monthly monetary contributions a child must provide to the household.
This lacks clear definition and is loosely based on the household income per capita.
Hence, the children of seniors are not liable to contribute to the household despite living under the same roof. In such cases, seniors may not have adequate financial support from other members of the family even if the children are well-to-do.
Then there is the other side of the coin – where children are living away from the parents but are still contributing to the living expenses of the elderly.
This brings up my argument - unless the Maintenance of Parents Act is reviewed to include conditions of household support, this would be a very flawed criterion for the system to use as a benchmark to assess whether an elder should be included under the Silver Support scheme financial aid.
Analysis of Situations in Perspective
Case 1: An only child living with retired parents that meet 2 out of 3 criteria.
While they meet the first 2 criteria for the Silver Support Scheme (minimum CPF and housing type), the family fails to qualify due to the third condition as the child makes $3,500 (which averages out to slightly less than $1,200 per person within the household). However, SSS does not assess other circumstances, e.g. whether the parents are of good health and whether the family has any outstanding loans (housing, education).
Case 2: Elders that meet 3 criteria but also receive monthly financial support from children who live elsewhere. Since the elderly parents are the sole-owners of the 3 room flat and there is theoretically 0 household income support, it is likely they would be eligible for the Silver Support Scheme.
As we can see, for the first case, the bulk burden of the household falls upon the only child and monthly income of $3500 can hardly be called as well-to-do nor average (median income is $3,949, average income is about $4,600). Therefore, if we could weigh the two families’ financial situation, most would be inclined to lean towards the first case as the case requiring more attention.
Unfortunately yet not surprisingly, this is a very typical and common phenomena.
Cases that fall through
Under this severely flawed Silver Support Scheme, families with the only child as the sole breadwinner are penalised while those well-to-do elderly folks get additional financial support from the Singapore Government. Which is a bad way to channel funds to helping people that dont need further help.
A Badly Thought Policy
The Silver Support Scheme is a bad policy which only addresses financial help for extreme cases while the funds are being "misused" to support many elderly who choose to live away yet are supported financially by their children.
If we could postulate and make further assumptions down the road, this scheme is only kicking the can down the road, by leaving the only child with little means of planning ahead financially for the setting up a family or for his/her own retirement. At the same time, it appears that the Singapore Government is contradicting itself with a policy that does not promote nor encourage children to live with their parents.
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Actual Criteria to qualify under Silver Support Scheme.
To be eligible for Silver Support, one must be a Singapore citizen aged 65 and above, and must meet all of the following criteria:
Total CPF contributions of not more than $70,000 by age 55. Self-employed persons should also have an average annual net trade income of not more than $22,800 when they were between the ages of 45 and 54.
Live in an HDB flat that is 5-room or smaller.
Not own, and not have a spouse who owns, a 5-room or larger HDB flat or private property or multiple properties.
Live in a household with a monthly income per person of not more than $1,100.
http://www.mom.gov.sg/employment-practices/silver-support-scheme
