SINGAPORE: CPF members who turn 55 between 1 July
2012 and 30 June 2013 have to set aside a Minimum Sum (MS) of
S$139,000, higher than the S131,000 for 2011.
The CPF Board and Ministry of Manpower (MOM) said on
Wednesday that the MS has been adjusted over the years to account
for inflation, longer life expectancies and Singaporean's rising
expectations of their quality of life after
retirement.
They said that since 2004, the MS has been increased
by S$4,000 each year to reach S$120,000 in 2013, as recommended by
the Economic Review Committee in 2003.
The actual increases in MS are also adjusted for inflation each
year.
The S$120,000 target in 2003 dollars is effectively S$120,000,
adjusted for inflation between 2003 and the time the target is
met.
Doing so preserves the real value of the target.
Based on 2011 inflation and incorporating the annual S$4,000 (in
2003 dollars) adjustment, the increase in MS due this year would
have been S$12,000, which is relatively large compared with
previous years.
In response to concerns over large increases in MS in any given
year, the CPF Board and MOM said they'll spread out the remaining
MS increases needed to reach the S$120,000 target over a longer
period of four years.
This means they'll reach the target in 2015, instead of 2013.
With this change, the 2012 MS will be S$139,000, an increase of 6
per cent, or S$8,000, over 2011.
Without the change, the 2012 MS would have been S$143,000, or a
9-per cent increase, over 2011.
Changes will also be made for contributions to the Medisave Minimum
Sum (MMS) to help Singaporeans plan for their long-term healthcare
needs.
From 1 July (2012), the MMS will be raised to S$38,500, from
S$36,000 - an increase of 7 per cent.
The MMS is the amount that a person who turns 55 needs to set aside
for hospitalisation expenses in subsidised Class B2 and C wards,
subsidised outpatient treatment for selected chronic conditions and
basic MediShield and ElderShield premiums.
Members will be able to withdraw their Medisave savings in excess
of the MMS at or after age 55.
Another change - also from July - is in the Medisave Contribution
Ceiling (MCC).
It's the maximum balance a member may have in his Medisave
Account.
This is set at S$5,000 above MMS and would be increased
correspondingly to S$43,500, from S$41,000.
Any Medisave contribution in excess of the prevailing MCC will be
transferred to the Special Account if the member is below age 55,
or to his Retirement Account if he is above age 55 and has a MS
shortfall.
- CNA/ck
