While the minimum S$15 fee for administrative costs imposed in processing un-nominated Central Provident Fund (CPF) monies is understandable, it is less clear as to why there is a need for a schedule of charges by a percentage based on the amount CPF monies, said Workers’ Party (WP) Member of Parliament Louis Chua.
In a Facebook post on Tuesday (20 Apr), the Sengkang GRC MP shared the story of a close friend of his who had lost his father recently and was in the process of carrying out financial and legal procedures, including CPF-related matters.
Mr Chua said his friend was informed that his late father had not made a nomination for his CPF monies, meaning that the monies had to be transferred to the Public Trustee. It was only then that the family could make an application for the monies to be distributed among them.
At this point, Mr Chua highlighted: “What is less commonly known, however, is that the fees charged by the Public Trustee are based on a percentage of the CPF money, with a schedule of fees involved.”
He went on to illustrate this with an example.
“If the amount of CPF money is $10,000, the fees would be $159 and if it’s $100,000 it would be $834,” said the MP.
Mr Chua also included several images in his post, showing the question he had raised in Parliament on 5 Apr on the matter when he asked how the minimum fee of S$15 and schedule of charges is determined.
In response, Law and Home Affairs Minister K Shanmugam responded that the fee is used to cover the cost of administering un-nominated CPF monies.
The Minister said, “This includes resources expended to trace a deceased’s next-of-kin, identify all eligible beneficiaries, and establish the familial relationship between beneficiaries and the deceased.”
In his post, Mr Chua had then encouraged the public to ensure that they promptly make their CPF nominations, which can be done online.
CPF nomination can be done online
Essentially, a CPF nomination allows a person to specify who will receive their CPF savings, and how much each nominee receives, after their death. This would ensure that your loved ones can receive your CPF conveniently. It is important to note that CPF savings cannot be included in your will, which is why it is important to ensure nominations are done.
CPF nominations cover the Ordinary, Special, MediSave and Retirement Accounts, as well as unused CPF LIFE Premiums and Discounted Singtel shares. It does not cover property bought using CPF savings, payouts from Dependants’ Protection Scheme (DPS) or investments made under the CPF Investment Scheme (CPFIS).
According to the CPF website, parents can nominate their children with special needs to receive the CPF savings due to them on a monthly basis. Also, beneficiaries will receive the CPF savings due to them in cash via cheque or GIRO, unless you specify otherwise.
CPF also notes that you should consider if you want to authorise someone to receive your CPF information upon your death. If you do specify someone, the CPF Board will disclose your CPF statement in and after the year of your death as well as your nomination details to that person if they request it.
CPF also recommends that you inform two witnesses of your intention to make a nomination.
The nomination can be done either online via my cpf Online Services using your SingPass, or in-person at CPF Service Centres. If you wish to do it in person, you should make an appointment beforehand as nomination services are only available on an appointment basis.
In his post, Mr Chua said: “Saying goodbye to our loved ones is never easy. While we are still fortunate to be in good health today, one of the things that we can do to help our loved ones upon our demise is to make a CPF nomination online.”