Sunday, October 04, 2015

Can Singapore afford the Scandinavian welfare system?

David Tan Guang Xiang asked:

Mr Tan, how about the aging population in Singapore. If we adopt the Scandinavian system, can our tax payers still support the system after 15-20 years when the baby boomers from the 60's are in their 70's and 80's.

The Scandinavian system will have its challenges. It can become more costly when the population gets older. But, it can be managed, e.g. by extending the retirement age or reducing the benefit.

The Singapore system also has its drawback, i.e. low income people having to work until they die.
The government think that they can avoid the risk of the welfare state, but it does not solve the problem. It only pushes the problem to the people.

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