As ageing populations continue to pose a challenge to governments worldwide, policymakers are struggling to balance delivering adequate financial security for their retirees while keeping it sustainable for the economy.

Measuring 34 pension systems worldwide, the Melbourne Mercer Global Pension Index shows that the Netherlands and Denmark (with scores of 80.3 and 80.2 respectively) both offer A-Grade world class retirement income systems, topping the index globally.

In Asia Pacific, top performing countries are Australia, Singapore, and New Zealand, scoring 72.6, 70.4, and 68.5 respectively.

Zooming in on Singapore, the retirement income system is mainly based on the Central Provident Fund (CPF) which covers all employed Singaporean residents and permanent residents.

Commenting on how the Singaporean system could continue to grow and improve its Index score, Garry Hawker, director of strategic research for growth markets, Mercer, said: “The overall index value for the Singaporean system could be further increased by reducing the barriers to establishing tax-approved group corporate retirement plans; opening CPF to non-permanent residents; and increasing the age at which CPF members can access their savings that are set aside for retirement, as life expectancies rise.”

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