Mr Louis Chua, a Workers’ Party Member of Parliament for Seng Kang GRC, has urged the government to review the Central Provident Fund (CPF)’s Ordinary Account (OA) formula. He believes that the formula should be adjusted in a timely manner to ensure that Singaporeans’ retirement savings can keep up with inflation or at least reflect market interest rates.
The Central Provident Fund (CPF) and the Housing and Development Board (HDB) have announced that the interest rate for CPF’s Special and MediSave Account (SMA) will increase to 4.01% per annum for Q3 2023. However, some netizens criticized the increase, stating that it was only a 0.01% increment and barely noticeable in small CPF balances. In comparison, Malaysia’s Employees Provident Fund (EPF) declared higher dividend rates for conventional and syariah savings.
CPF accounts of non-Singaporeans or permanent residents will be automatically closed from 1 April 2024, according to the Central Provident Fund Board. This move is to ensure that the CPF system focuses on meeting the retirement, housing, and healthcare needs of Singapore Citizens and Permanent Residents. Non-SC/PR members are advised to transfer their savings to their bank accounts before the deadline.