Wednesday, October 12, 2011

Higher retirement age for private sector? Possible.

The government has increased retirement age from 58 to 60. But that’s for the civil servants. The private sector still has to keep 55 as its retirement age.

Like most of us, our Human Resources Minister, Datuk. Dr. S. Subramaniam feels the retirement age should be raised in private sector too.

He was quoted by The Star newspaper as saying that the current retirement age of 55 was set many years ago when the life expectancy of Malaysians was around 55.

“Now, it is around 75, so we can’t keep the retirement age at 55,” said Dr Subramaniam at a press conference after launching the Malaysian Employers Federation (MEF) national conference 2011.

Earlier in his speech, he said Malaysia was “lagging behind” in terms of its retirement age requirement compared with other countries in the region such as Thailand, the Philippines and Singapore.

He said representatives of employers, employees and the Government were currently in discussion to decide on a new retirement age for the private sector.

He added that the MEF had agreed in principle to the proposed rise in the retirement age, but had some reservations that needed to be addressed.

“The Private Sector Retirement Age Bill is currently being drafted. The Act will give us the power to stipulate the retirement age for the private sector,” said Dr Subramaniam.

He said that currently, the Em- ployment Act only stipulated the retirement age for the government sector.

“Now that the retirement age for government workers has been extended, people will expect the private sector to follow suit,” he said.

Prime Minister Datuk Seri Najib Tun Razak announced that the retirement age for the civil service would be raised from 58 to 60 years when announcing Budget 2012 last week.