Tuesday, February 20, 2007

Workfare Bonus

The workfare bonus is an excellent idea. It supplements the earnings of the older workers and encourages more people to work.

I wish to suggest two improvements to the current scheme:

* remove the requirement on annual value of the home
* pay the supplement monthly into the CPF account.

Here are my reasons.

If an older person works for a low income, he is likely to be in financial need. There is no need to check the type of house that he lives in, and whether he owns or rents the home. Let us also help those who are "asset rich and cash poor" to earn a supplementary income.

In many countries, older people receive a pension, and are not required to meet any means test. In our case, the older person has to work to receive a modest supplement (less than $100 a month). Let us not make it too difficult for them.

If the supplement is paid monthly, the employer can include it as part of the pay package and communicate it to the older worker. It will also encourage more employers to create jobs for older workers.


Thomas Phua's Blog said...

Mr Tan is correct in his observation that housing type should not be a criteria.

I know of people who drives Mercedes 320 and stays in a 5 Rm HDB flat.

A $1000 a month delivery driver who stays in a jumbo flat.

Some who are asset rich, but quite strapped too.

Difficult to balance across so diverse housing type.

iRis said...

I disagree with the notion that "asset rich and cash poor" constitutes poor people. Reason is simple. These group of people can sell their assets and get cash rich. Its only a matter of handling and managing their finances. They are definitely not poor, they only mismanage their finances and thus become cash poor. Poor are those who are asset and cash poor and they are the ones who are fighting for daily survival.

My 2 cents worth...

Edwin said...

My question to iris,
How would you define asset and cash poor?

What constitutes to asset rich? Anyone staying in more than a 4 room flat?

Housing for the masses aren't really that affordable these days, even with grants provided. This is especially so in mature estates, where your parents have been staying there for the past 15 years or more. Unless of course, you want to get away as far from your parent's or inlaws... ;-)

jess said...

iagree with Iris. give this kind of work fare bonus to people who need it eg the older ones who earn less. those who are really not well to do and not someone who drive a mercedes .

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