All CPF policies are implemented by the PAP without any real consultation with citizens. CPF rules have been continually tweaked and is now too complicated for many CPF members to understand.
One rule which has gone unnoticed is the Minimum Sum (MS) rule which requires 50% in cash even if a member has already set aside 100% in the HDB flat.
Eg. (CPF MS currently $148,000)
CPF member has already used $148,000 to pay for his HDB flat. When he turns 55 this year, he will still need to set aside an additional $74,000 in the Retirement Account (50% of MS).
This makes no sense as he is now effectively setting aside $222,000 ($148,000 + $74,000) from his CPF savings. (a CPF member who does not own a HDB flat has to set aside only $148,000 from his CPF for retirement)
So how could a citizen who after having met the CPF MS (through housing) be told that the amount is still insufficient? How can the PAP turn around and tell us that in order to ensure retirement adequacy, we need to help ourselves further by setting aside even more cash? This is nonsense.
Since Singaporeans have the highest retirement savings in the world, the only conclusion for this sad state of affairs is the CPF system is broken.
Who decided on the CPF MS 50% rule? PAP. Who decided on the MS? PAP. Who decided on the maximum use of CPF for housing? PAP. Who decided to increase the MS at an insane rate of 6% for the last 20 years? PAP.
In short, the PAP is the rightful owner of all the problems related to our national pension scheme. But it has refused to own up, insists on zero transparency and accountability and penalises CPF members by legislating a perpetually higher MS which fewer CPF members are able to meet.
The PAP, in collaboration with the mainstream media, has misled CPF members into thinking the government has been helping us. A government which sincerely wants to help would have increased the CPF rate of returns, increased salaries of workers, reduced the MS amount, etc.
Has the PAP helped CPF members by simply tweaking CPF rules with the stroke of a pen? The answer is clearly no.
– Most CPF members have already set aside the MS of $148,000 in the form of their HDB flats.
– The MS 50% cash requirement is in addition to the $148,000.
The CPF MS 50% is a rubbish rule designed to trap CPF members’ savings to benefit the GIC. CPF members must not allow the government to suka suka keep tweaking CPF policies to deprive us of our hard earned retirement savings.