CPF reforms carefully considered, govt can deliver: PM Lee
By S Ramesh, Channel NewsAsia | Posted: 23 September 2007 1818
hrs
SINGAPORE: The latest CPF reforms were finalised after
carefully calculating that the government can deliver on what it
has promised, said Prime Minister Lee Hsien Loong on
Sunday.
Chairing a dialogue with five other ministers for some 500
grassroots leaders, Mr Lee said any scheme devised has to be fair
to everyone.
The prime minister said a British pensions expert he met recently
had three possibilities to solve the problem of living longer and
providing for old age.
The first is to work longer and enjoy a shorter period of
retirement, the second option is to save more while working, and
the third is to choose to have less money when one grows old.
For Singapore, the CPF reform is the right thing to do as it will
benefit many, especially the low-income ones.
He said: "It's not something that is going to make a difference
overnight because we are talking about something when we grow old,
and you are talking about 10, 15, 20 years from now.
"This is something if we didn't do, it will not disturb us now, it
will not affect the next election, nobody will blame us until we
are 35 years from now, when the problem is here, then people will
say what kind of government did we have 35 years ago, (they) never
took care of us. I think it is our responsibility to do that
now."
Mr Lee said the CPF interest rate is better than that given
by the banks, and he had a tip for wives.
"All the women should tell their husbands that the government's CPF
interest rate is now very high, better than the POSBank anytime so
better take your money from your POSB (account) and put into my CPF
account," he quipped.
The extra one percentage point given by the CPF Board is something
Singaporeans will find hard to get anywhere else.
Mr Lee said: "The government is taking care of it 100-percent
risk free. The money is there, it will never disappear. People say
go with GIC, Temasek; GIC makes so much money, you should give me
the same like GIC. But GIC invests long-term they buy shares, the
stock market goes up, the stock market goes down.
"(In the) last few months, the stock market has gone down. I am
sure GIC's portfolio would have gone down. And not just your
interest is less that means your capital gets less. I was
persuaded by MOM (Ministry of Manpower) and MOF (Ministry of
Finance), against my preference, that it's better for the
government to take on this responsibility for the first S$60,000
because it's a big burden."
Measures to ensure that Singaporeans have a secure retirement go
beyond just improving the CPF system.
PM Lee explained that the various measures taken by the government
to improve the housing programmes, education system and even
Workfare all contribute to achieving that objective.
On the Longevity Insurance or annuities, Mr Lee said he is prepared
to consider various options.
"You put the money, you buy the annuity, they pay you, you die,
(but) they will continue paying your spouse until she dies. That is
something we should consider and can be an option in the scheme
which will address the needs of quite a number of old folks," he
said.
Mr Lee said the CPF changes are major and hopes the dialogue will
help community leaders better understand what the government is
doing for the country's long-term good.
- CNA/so
minus all the wayang, it's a pretty dead sure thingy 
