HDB Director of Branch Operations, Ms Lim Lea Lea, wrote to ST Forum today (17 Sep) in reply to public enquiries of asking the Government to make the HDB lease buyback scheme (LBS) more “senior-friendly”.
The LBS is a monetisation option for elderly household living in HDB flats. Through this scheme, the elderly will be able to tap on their flat to receive a stream of income in their retirement years, while continuing to live in it.
Essentially, the elderly sell part of their flat’s lease back to HDB. The proceeds from selling part of their flat’s lease will be used to top up their CPF Retirement Account (RA). They can then use their CPF RA savings to purchase a CPF LIFE plan, which will provide them with a monthly income for life.
“Under this scheme, seniors use part of their proceeds to top up their CPF Retirement Account and join CPF Life to receive a monthly income stream for life,” Ms Lim wrote.
“The CPF top-up requirement seeks to strike a balance between channelling the proceeds towards a retirement annuity on the one hand, and cash proceeds on the other.”
She added that elderly who take up LBS need to top up their CPF savings to reach the current Full Retirement Sum.
“This amount varies with households and it ensures that their monthly payouts are adequate to meet their basic living expenses. The qualifying age of 65 for LBS allows seniors to immediately receive their monthly CPF payouts when they take up the scheme,” she said.
However, it appears that HDB is now willing to lower the age requirement for LBS for elderly currently under duress.
Ms Lim said, “Nevertheless, HDB is prepared to exercise flexibility on the age requirement, especially for those who are in ill health or financial difficulties.
The willingness of HDB to lower the age requirement to qualify for LBS reflects the current dire situation our elderly are in. Many just do not have enough money to retire comfortably in their twilight years, as the PAP government doesn’t believe in any pension scheme for our elderly. Many have no choice but to continue to work till their last breath in Singapore.