Bhutanese men boast with pride how active they are at 60 years or beyond, and perhaps women too. There may be a sexual connotation, but it does indicate that 60 is not an old age. Linking this with the decision to increase the superannuation age by one to three years across various rungs of the civil service, is a good decision.

Increasing the superannuation age, going by the civil service commission, the biggest employer, was in consideration of the substantial increase in the life expectancy to 70.2 years, the expectations of higher returns on human capital investments and the current human resource gaps.

The age of retirement in Bhutan is one of the youngest in the world. It is not only in the civil service. An elected leader, notwithstanding his leadership or wisdom, cannot serve beyond 65 years. Many who superannuate are absorbed back in the system indicating that they still have the energy and the potential to serve.

There had not been much discussion on the RCSC’s decision, at least in the public domain nor were there protests on the decision to increase the superannuation age like in some countries whose limit was already higher or older.

Many would welcome it as it means a few more years of guaranteed monthly salary and increased benefits on the pension. It is true that increasing the superannuation age by a few years, especially when life expectancy has increased significantly, would benefit the employer and the employee. In our context, the civil servants.

However, the current trend is quite the opposite of what many might think. Hundreds, if not thousands, resign before they become a part of the pension system. In Bhutan, it is 20 years and many retire to find new opportunities after taking the lump sum pension benefits. It may not be entirely the fault of our pension system, where people fear getting into the “Pension system” and resigning before serving 20 years.

Those aware of the pension system feel that the move is to save the pension system as it is becoming inviable because of the demographic change and therefore the burden on the government or the National Pension and Provident Fund.  It may not be the case, but increasing the superannuation age will have consequences. This is typically true in Bhutan where every decision made for the civil service is replicated in other sectors.

Hiring and firing employees, for instance, even in the public corporation and state-owned enterprises is rare, perhaps a legacy of the trend in the civil service. The decision to increase the superannuation age is welcomed mainly by those who want to cling to their jobs for a few more years, notwithstanding the contributions.

The civil service decided on increasing the retirement age. That is fine. They should not impose it on other sectors. If hiring and firing based on performance is a missing trend in the country, public corporations and SOEs made to follow the same rule could affect performance.

As a small and close-knit society, it is hard to fire people even if they are a burden to the company. The RCSC’s decision has already become a reference point for others – employees in corporations and SoEs.