The following is a letter to the Today newspaper by Mr Leong Sze Hian.

I refer to “MPs: Is it really secure?” (July 21).

Since Manpower Minister Gan Kim Yong has given his assurance in Parliament that the monthly payouts will be paid for life — despite the provision in the new law which allows the CPF Board to stop CPFLife payments unless the Lifelong Income Fund is solvent — then why have this provision in the first place?

Years down the road, the law will prevail, regardless of what the minister said in a past Parliamentary debate.

Moreover, as “the minister cannot make changes at will but must base his decisions on sound actuarial principles to ensure that fund solvency will not be compromised”, is this not somewhat self-contradictory?

As how then can the fund become insolvent and thus stop payouts?

I understand that historically, no country in the world has ever had to stop pension payouts due to fund insolvency.

Even insurance companies’ annuity contracts are contractually backed by the full faith and credit, and assets of the insurance company, and are not subject to the solvency of the pooled annuity fund.

So, why is CPFLife so different?

Despite the vigorous debate, I think some Singaporeans may be disappointed that Parliament has passed a law which effectively changes the current 4 per cent guaranteed return (plus one per cent on the first $60,000) on monthly payouts from age 62, to one which can stop payouts altogether if the fund is insolvent.

When the scheme was originally announced, implementation was to have been in 2013, to give Singaporeans some time to make adjustments to their retirement planning, as the payouts will start later at age 65 instead of 62, and the payout amount may also be lesser.

Bringing it forward now by more than three years to September this year may cause financial stress to some Singaporeans, particularly the lower-income ones.

——-

Subscribe
Notify of
0 Comments
Inline Feedbacks
View all comments
You May Also Like

非法经营冷藏库,海鲜批发公司被判罚款1万2千元

一家海鲜批发公司因非法经营冷藏库,被判罚款1万2千元。 新加坡食品局发文告表示,去年7月,本地一家海鲜批发公司“Yuan Yong Fong Seafood”,被查获经营一家非法冷藏库,并在冷藏库内出售以及储存肉类与海鲜,多达970公斤,经已被食品局充公。 另一家公司“Supreme Aquarium”,也因允许无牌冷藏库在其场所经营,而被罚款2000元。 食品局提醒民众,无牌经营冷藏库,非法冷藏与储存肉类和海鲜,会构成食物安全隐患。 因此,所有肉类或海鲜储存设施都必须先经过食品局的审查,符合食品安全规格与标准,方能开始经营。 非法储存肉类或海鲜产品者,一旦罪成,可判罚款最高1万元,或监禁长达1年,或两者兼施。

How much social assistance was given to the technician who stole earth cables to sell, in order to pay for medical and school fees?

I refer to the article “Man stole copper wires from mall to…

Job placement rate increase (magically) by 2.7 times?

By Leong Sze Hian I refer to the Department of Statistics’ (DOS) Monthly Digest…

Police report filed against PAP’s Murali Pillai over “falsehoods” regarding “scurrilous attack” on his family

A police report was made against PAP candidate Murali Pillai on 8…