Parliament: CPF replies that throw up more questions? (part 1)

We refer to the article “CPF remains ‘key pillar’ of Singapore’s social security system: Tan Chuan-Jin” (Channel NewsAsia, Jul 8).

Half of active CPF members met Minimum Sum?

It states that “Responding to a query by MP Gan Thiam Poh, Mr Tan said that half of active CPF members met the Minimum Sum in 2013, including 15 per cent who used their properties to support up to half the Minimum Sum. About one-fifth of the entire cohort who turned 55 in 2013 had balances above the Minimum Sum that were not withdrawn, possibly to enjoy the “risk-free returns on their CPF savings”, Mr Tan suggested.

23% inactive CPF members?

The article “CPF issue: More meeting CPF Minimum Sum due to wage growth, policy improvements” (Straits Times, Jul 8) said “For inactive CPF members, many of whom have not worked regularly, he revealed that 23 per cent of Singaporeans who turned 55 in 2013 were inactive CPF members, while the remaining 77 per cent were active members or self-employed.”

– In the past, I understand that the disclosure of the Minimum Sum statistics had always referred to inactive CPF members, i.e. those who did not make any CPF contributions for more than 3 months.

Did not really answer NCMP’s question?

The subject reply in Parliament in our view, did not really answer NCMP Mrs Lina Chiam’s question which asked for the number of active and inactive CPF members at age 55?

How come now talk about self-employed?

Allow us to explain. The reply now talks about another category – the self-employed at age 55.

Since no  breakdown was given, we do not know how many of the “77 per cent who were active members or self-employed”, were active members and self-employed.

For example, if we assume that about 17 per cent of the 77 per cent were self-employed – then, 60 per cent were active members.

Only 30% of age 55 met Minimum Sum including property pledge?

So, since “half of active CPF members met the Minimum Sum in 2013, including 15 per cent who used their properties to support up to half the Minimum Sum” – does it mean that only about 30 per cent (half of 60 per cent) were able to meet the Minimum Sum including the property pledge, and only about 15 per cent (30 minus 15 per cent who pledged property) met it entirely with cash?

Only 1 in 7 met Minimum Sum in cash?

Hence, does it mean that only about 1 in 7 Singaporeans who reached 55 last year, were able to meet the Minimum Sum entirely with cash, without pledging property?

“Key pillar of social security system”?

If so, arguably, has our CPF failed in being “the key pillar of Singapore’s social security system”?

S Y Lee and Leong Sze Hian

About the Author

Leong
Leong Sze Hian has served as president of 4 professional bodies, honorary consul of 2 countries, an alumnus of Harvard University, authored 4 books, quoted over 1500 times in the media , has been a radio talkshow host, a newspaper daily columnist, Wharton Fellow, SEACeM Fellow, columnist for theonlinecitizen and Malaysiakini, executive producer of Ilo Ilo (40 international awards), invited to speak more than 200 times in over 30 countries, CIFA advisory board member, founding advisor to the Financial Planning Associations of Indonesia and Brunei. He has 3 Masters, 2 Bachelors degrees and 13 professional  qualifications.