Previously, we grouped temporary and informal workers together. The term informal workers is somewhat difficult to define, but includes:
We identified a flexible fund sponsored by the government, the financial services industry or labour brokers as a potential solution. The fund sponsor would have to deal with three key challenges:
The government’s latest proposal to offer non-retirement, tax-free savings accounts may offer one part of the solution. It requires solutions to be simple and cost-effective, fully transferrable between providers, and to pose no penalties for noncontinuous contributions. But as most informal workers are also low-income earners, is a tax incentive attractive enough to stimulate savings in this segment?