It was reported in the news today (4 Jul) that CPF members can now withdraw money from their own CPF, but only if they are “severely disabled” and are at least 30 years old.
For these “severely disabled”, they are now allowed to withdraw cash from their Medisave account in CPF, starting in 2 years’ time in 2020. However, this is contingent on them or their spouse to have at least $5,000 in their accounts.
This is the first time members will be allowed to withdraw cash from Medisave since it was set up in 1984 as part of Central Provident Fund contributions to help defray hospital bills.
Those with at least $5,000 in their Medisave accounts will be able to withdraw $50 a month while those with $20,000 or more will be allowed to withdraw $200 a month. Fifty dollars a month is roughly equivalent to buying 20 packets of chicken rice for a month at $2.50 per packet.
The magnanimous Health Minister Gan Kim Yong explained, “When a Singaporean is facing severe disability and, at the same time, facing financial difficulties, I feel that we can afford to be more flexible.”
Indeed, with the CPF rules now relaxed by the Minister and with the extra $50 a month coming from one’s own savings, the “severely disabled” can now afford to buy, say, an extra 20 packets of chicken rice a month.
MP Chia Shi Lu, head of the Government Parliamentary Committee for Health, also added, “I am glad that these Medisave monies will be disbursed in cash for better flexibility for patients and their families.”
In 2020, the mandatory insurance scheme, CareShield Life, will also be kicking in. It is compulsory for people aged 40 years and younger. Under this scheme, those who are severely disabled will get a minimum of $600 a month for life.
Will those who withdraw money have their application for social assistance rejected?
Earlier last month, Sports advocate and politician, Jose Raymond shared a story of a 59-year-old male Singapore who is both visually handicapped and has kidney failure who has had his application for long-term financial assistance rejected by the Ministry of Social and Family Development (MSF).
It was revealed through a letter from MSF that the reason for the rejection of the application is due to the monthly pay-out that the blind senior receives from his Central Provident Fund (CPF) owing to his medical condition.
“The MSF needs to explain its rationale for using the prevailing Public Assistance rate for rejecting someone like the resident above, who is visually handicapped and who cannot earn any other income because of his medical condition.” wrote Mr Raymond and added, “Our citizens need to lead dignified lives.”
In the response to the story, MSF said in a Facebook post that the Social Service Office (SSO) made an assessment of the resident’s needs.
“To determine how much further assistance he required, the SSO considered his sources of income, money received and support provided by family, friends and the community.”
In response to MSF’s post, Mr Jose Raymond said that the MSF has not responded to the core issue. “Why is one’s CPF being treated as income when it assesses social assistance needs, which was stated in its rejection letter?”
Given the above case study, one will wonder if social assistance application will be cut off or denied for those who are allowed to withdraw up to $200 as such withdrawals might be deemed as a source of income by MSF.