There has been much debate in recent weeks over the CPF scheme and how our savings are being managed by the Government. Unfortunately. the recent accounts given by DPM Tharman Shanmugaratnam has raised more questions than answers.
Such a confusion has raised the ire of many Singaporeans, and rightly so. The stewards of public funds must be transparent and consistent in their dealings.
The suspicions of the people over our hard-earned CPF savings would not have arisen if the PAP had not reneged on its promises and, worse, kept Singaporeans guessing on how these funds are being managed.
Such an approach needs to be corrected which is not a difficult thing to do. What we need is for the GIC to be fully accountable to the people and for the Government to keep its promises.
In our forthcoming economic policy paper, the SDP proposes the following:
1. Abolish the Minimum Sum Scheme (MSS) and return retirees their CPF savings.
The reason given by the PAP that retirees will squander their CPF cash and therefore the need for the MSS is a non-starter. If the Government is concerned with retirees blowing their savings, why did it establish casinos to further tempt them?
It argues that those who gamble away their fortunes at casinos are a minority. Precisely. If those who are not minded to spend their money prudently, why should the majority who do be penalised by having their savings withheld? Do we ban driving because a minority drink and drive or outlaw football because a few hooligans cause trouble at matches?
2. De-couple housing and healthcare from CPF.
The major reason why Singaporeans are left with insufficient retirement funds is because the PAP gives Singaporeans no choice but to use what is their retirement money to pay for their HDB flats and hospital expenses.
The SDP plan ensures that HDB flats are sold without the inclusion of land cost (see here) and that the Government stops profiting from healthcare (see here) In this way, our CPF savings are left unmolested for retirement.
3. Require the GIC to submit annual reports to Parliament.
All the confusion and allegations stem from the fact that the public is not given full accounting of GIC's transactions. The veil must be lifted by requiring the body to open its books - including all investment activity as well as extracts of the GIC’s financial accounts - for scrutiny and questioning by Parliament.
4. Hold the GIC publicly accountable for its actions.
The Corporation shall give an account of its funds, management costs, investment strategies (including strategies on socially responsible investments), a projection of value creation and risk management of these strategies. These can then be tracked and its managers held accountable for their decisions.
5. Ban ministers/former ministers from GIC leadership.
The current practice of having ministers helm the GIC is undesirable and must be discontinued. Instead, the management team of the GIC should be appointed to limited terms by the President subject to a public confirmation process conducted by Parliament.
The SDP in Parliament will push for the above measures to be enacted.