Instead of having national insurance, Singapore has compulsory saving. Rather frustratingly, they got this system from us. It now takes the form of payments into the Central Provident Fund. Employers and employees both pay into the accounts for each individual. This is a personal fund and one gets statements showing how much is in one’s fund. The saving is matched by investments. So it is very different from the British system where you pay your national insurance but you have no personal fund. You are also not imposing a burden on the next generation.
One of the advantages is that when money is taken out of your earnings for your pension, you feel it actually remains yours — even though you can’t spend it straight away. It does not feel like money down the drain
Excerpt from article in The Spectator here. The article follows a visit to Australia, New Zealand and Singapore made for the research for a new book.