Chee Soon Juan said this more than two decades ago

Singapore Democrats

In 1994, Dr Chee Soon Juan wrote in his book Dare To Change: "As a nest-egg for the elderly, the CPF is woefully inadequate."

Yesterday - that's more than 20 years later - the Straits Times said the same thing. In her column, Opinion Editor Ms Chua Mui Hoong, wrote:

The Big Issue in CPF reform isn't the Minimum Sum, the CPF Life annuity payouts or even allowing lump sum withdrawals. It is that most workers have low balances in their CPF accounts, period. This is even after working decades.

This is why it is so troubling that despite the gravity of the problem, Prime Minister Lee Hsien Loong continues to tinker around the edge rather than take the proverbial bull by its horns.

His proposal to return retirees 20 percent of their savings upon retirement does nothing to resolve the problem of inadequate CPF funds. This move is symptomatic of Mr Lee's leadership – trying to appease the public while sticking to unjustified, and unjustifiable, policies.

The White Paper on Population is another example. After incurring the wrath of Singaporeans by saying that the Government intended to raise the population to 6.9 million despite all the problems that overcrowding brings, Mr Lee subsequently backed down and then gave a muddled reply that the population target would be “significantly below 6.9 million” but that “in the very long term, it should not increase beyond that”.

If the PM feels that retirees will squander their CPF savings, then why is he letting them withdraw 20 percent? Won't retirees also blow away this amount? What does this compromise achieve?

Clearly the PAP is playing politics by trying to placate the people's unhappiness while hanging on to their CPF savings - all this while ignoring the main problem which is inadequate CPF savings. 

To fix the broken CPF system and to ensure that our elderly can support their own retirement, the SDP proposes the following measures contained in our recently launched economic paper A New Economic Vision:

The Big Issue in CPF reform isn't the Minimum Sum, the CPF Life annuity payouts or even allowing lump sum withdrawals.

It is that most workers have low balances in their CPF accounts, period. This is even after working decades.

- See more at: http://www.straitstimes.com/news/opinion/more-opinion-stories/story/big-issue-cpf-not-the-min-sum-or-lump-sum-withdrawals-it-low#sthash.aZXGEqkf.dpuf

The Big Issue in CPF reform isn't the Minimum Sum, the CPF Life annuity payouts or even allowing lump sum withdrawals.

It is that most workers have low balances in their CPF accounts, period. This is even after working decades.

- See more at: http://www.straitstimes.com/news/opinion/more-opinion-stories/story/big-issue-cpf-not-the-min-sum-or-lump-sum-withdrawals-it-low#sthash.aZXGEqkf.dpufIn his 2014 National Day Rally speech, Prime Minister Lee Hsien Loong said that the Government was looking into the possibility of allowing Singaporeans to withdraw 20 percent of their CPF savings upon retirement.$CUT$

1. Return CPF savings in full. Retirees depend on their CPF funds for survival. Witholding their savings is not only unfair but also immoral.

2. Introduce ‘opt-in’ for Minimum Sum. Reitrees who want their CPF savings returned in instalments can do so voluntarily through an opt-in scheme.

3. Pay higher interest rates. CPF currently pays 2.5% interest rate. This should be adjusted upwards as GIC Return on Investment is higher.

4. Remove land cost from HDB prices. This will reduce HDB BTO prices and will mean less CPF funds used to service HDB loans, leaving more savings for retirees. (See here).

5. Lower healthcare costs. Abolish the Medisave scheme and return the funds ($43,500) to the individual’s CPF account. Increase government’s portion of the country’s healthcare expenditure from 30% to 70% to take care of the people’s health. (See here).

6. Increase social spending. Expand the budget for the Ministry of Social and Family Development to ensure that the needy and elderly segments of the population are not neglected.

7. Reduce public transport fares. Senior citizens over 65 years will have free bus and MRT rides during off-peak periods and 50% concession during peak periods. Taxi services will provide free transport for those over 80-years old for essential medical appointments.

8. Abolish GST for medication and basic foodstuff. The elderly are bigger consumers of medical treatment. Abolishing the GST for drugs as well as basic foodstuff will help them stretch their dollar.
 

Monday, 09 February 2015 SDP Print

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