MSM is PAP’s mouthpiece and one can expect more published propaganda on CPF to encourage the retention of retirement savings permanently in GIC. There appears to be an issue of solvency, unless of course a proper set of accounts is disclosed to Parliament.
ST senior correspondent, Goh Eng Yeow, has attempted to prop up the greatest Ponzi scheme with silly arguments in his article, “CPF topping up: A great way to save”. Goh encourages savings in the form of putting our retirement funds into CPF Special Account which is essentially a see-no-touch account until you’re almost dead; 18% of CPF members die before hitting 65.
PAP justification to not disclose our reserves managed by GIC – speculators will attack our currency during times of volatility – is all hogwash. If not publicly disclosed, why not to MPs? Can’t our MPs be trusted? Do they not represent the people? Why is information pertaining to about half a trillion dollars of reserves known to only a handful of ministers/PAP’s trusted circle?
Singaporeans have valid reasons to be deeply worried about our CPF investments having gone up in smoke.
I am all for retirement planning and am a great saver but what I am against is PAP’s non-transparency, no accountability, abuse of power to tweak CPF legislations to retain billions in CPF funds and appointing unqualified former paper generals to head CPF Board.
Since Goh’s article is merely PAP’s propaganda – lacking in facts – he had to spin a grandmother story revolving around his centenarian aunty and family members. Like the PAP, Goh tries to frame the issue and places the retirement responsibility squarely on our shoulders despite the fact that PAP is the main culprit in causing our huge retirement shortfall.
An unaddressed issue is the allocation of a disproportionate amount of CPF for housing consumption/investment. Goh conveniently forgets that CPF allocation rates are fixed by the government with the highest percentage of wages going to the OA. This is mainly used to fund housing.
Using absurd legislations to justify its action, the PAP has also creamed off half of our CPF returns for decades. (More than $60 billion during the past 20 years alone.)
It is the government’s responsibility to right the flaws of the CPF scheme but instead of questioning the government, Goh’s ‘solution’ is to channel even more money into CPF. Who is Goh trying to kid?
Billions in CPF channeled into housing for decades plays the most important role in asset inflation and consequently the prices of all goods and services. Is this not obvious to Goh? Is he afraid to question the government?
Goh’s parents are Singapore pioneers in their 80s who are still dependent on him to “foot their bills, including medical expense”. So why isn’t the government taking care of their NEEDS despite PAP’s acknowledgement of pioneers’ immense contributions? Why are tens of thousands of pioneers still struggling?
Why are our pioneers slapped with a $1000 plus MediShield insurance premium which may still require thousands in cash outlay in the event of hospitalisation?
Instead of using his parents as an example to suggest more funds to be permanently trapped in the Special Account, shouldn’t Goh instead question government policies?
Cost of living issues are singlehandedly created by PAP through its total control of Parliament, if Goh is still unaware.
Goh says his nephew actively manages his own CPF Investment Account but in Goh’s opinion, his nephew should instead top up the invested amount into the CPF SA because it pays a higher interest and is meant for retirement.
Again, why doesn’t Goh advise the PAP that it is not prudent to allocate 63% of monthly CPF contribution to housing? Why not increase the SA rate by reducing the OA rate if the government is so concerned about our retirement?
But of course this is not possible because housing prices will collapse without the support from our retirement savings. This is common sense.
Goh: “In the past 20-odd years, the only time I can recall getting a higher interest rate than the 4 per cent offered by the SA was during the 1998 Asian financial crisis …until the deposit matured one year later”. He should not try to pass off his poor recollection as facts.
According to the MAS, the average interest rate for a 1-year FD was between 4.01% and 4.82% from 1995 to 1998. Is fact checking unimportant to senior correspondents at ST?
The SA rate was an anomaly but it was not determined by market forces: PAP legislated the low rate for GIC to enjoy a lower borrowing cost. Yield curves do stay inverted at times but not for a prolonged period of 4 years.
Goh somehow couldn’t recall when long-term interest rates were much higher, eg in the 80s when US 30-year bonds yielded 15%.
Should such a scenario repeat, will there not be lost investment opportunities?
In the current low rate environment, the SA 4% seems heaven sent. However, economic fundamentals could change overnight and once money is trapped in the SA, it will severely limit one’s investment options. For example, property prices could collapse and offer a once in a lifetime investment opportunity.
Retirement savings in the OA or even if it’s invested under the CPFIS could act as a buffer in an emergency such as retrenchment. Transferring cash and CPF into the SA may result in the forced sale of one’s property.
Since 2010, SA balances have doubled to currently $79 billion. Bear in mind that PAP has a habit of tweaking legislations and once SA balances hit, say, $100 billion, goal posts may, again, be shifted. What’s there to prevent PAP from legislating SA balances into the RA where the funds remain untouchable until death?
Goh sings praises of the Supplementary Retirement Scheme (SRS) and encourages cash to be committed to GIC through CPF contributions. However, the money is locked up till one turns 62 and is obviously ring fenced for GIC’s use: PAP limits the withdrawal to $40,000 a year. Is this your money when the amount to be withdrawn is decided by PAP? More changes – of course not in our favour – akan datang when losses at GIC start to mount as the crisis unfolds.
Singaporeans have already set aside a world record 37% of wages for retirement. Why the need to have another supplementary account? And in CPF?
Why does GIC need so much money?
As an intelligent person, Goh should not be helping the PAP to trap billions in our CPF for GIC. Goh insults his own intelligence when he deems transparency to be a non-issue.
But Goh has also issued a caution that his article “sounds too good to be true”, unlike all the half-truths he propagates.
Says Goh in a final silly attempt to convince readers to transfer billions into the SA: “This delayed gratification will ensure that you don’t end up eating dog food in your golden years.”
Is Singapore not a wealthy county?
Name one instance of citizens in a wealthy country eating dog food in their golden years?
Has the Singapore government run out of funds, unable to discharge its basic obligation to take care of elderly citizens and requiring them to eat dog food?
Is Goh implying that our reserves are lost and whatever is left is unable to generate even peanuts to care for elderly citizens?
Talking cock at its best by another ST journalist.