Flexible retirement age would be fairer

An elderly man sips tea and sits on a warm afternoon in Shanghai, Feb 2, 2015. [Photo/IC]

The Ministry of Human Resources and Social Security recently said it is drawing up a detailed plan to compensate for the deficiencies of the social security fund, which will require people to work to a later age and so receive their pensions later in life. In a column for Beijing News, He Yafu, an expert in demographics, suggests it would be better to introduce a flexible retirement age system:

Different people have different health conditions. Some people might still be energetic when they reach the age of 60, while some might already suffer a serious illness. This will become a more serious problem should the authorities raise the retirement age for workers.

Therefore, a flexible retirement age system would be better. In the United States the average retirement age is 62. However, this is considered as early retirement and people retiring at this age will only receive 70 percent of the full pension that would be paid on reaching full retirement age, which varies between 65 and 67 depending on which year you were born. Of course, people can choose to retire later than normal, too, and the later they retire the higher their pension will be.

Such a flexible retirement age system allows those with better health to work longer for a bigger pension, as well as those with poor health to work for a shorter period of time but at a certain cost.

Since the government is determined to revise the retirement age system, why not adopt a flexible one? Of course we do not need to copy the one used in the US, but at least we can make it flexible so that domestic workers have choices.

A flexible retirement age system is also fairer because it follows the principle that those who work more get more income. Of course, such a flexible system might not save as much as the plan drawn up by the ministry, but in making any change the ministry should consider the interests of all members of society, not just the State.