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CENTRAL Provident Fund (CPF) members who have at least $20,000 in their Minimum Sum accounts will get the full bonus of $4,000 when they enrol in the new national annuity scheme, CPF Life.
The Life Bonus - or L-Bonus - will also be given to those with less than this amount in their Minimum Sum accounts, but wish to participate in the scheme. Such individuals, however, will receive the bonuses on a pro-rated basis, depending on the actual amount in their accounts.
From 2013, CPF Life will be compulsory for CPF members when they turn 55 - provided they have at least $40,000 in their Minimum Sum. They will get a lifelong payout every month.
Shedding more light on the L-Bonus in Parliament on Wednesday, Finance Minister Tharman Shanmugaratnam said that its main aim is to encourage housewives to opt into the CPF Life scheme when it starts.
He said family members of housewives, such as their spouses and children, will have 'strong incentive' to top up their CPF accounts and hence qualify for the lifelong payouts.
Mr Tharman was responding to points raised by various MPs during the debate on the Budget statement. MPs such as Dr Amy Khor (Hong Kah GRC), Mr Ang Mong Seng (Hong Kah GRC) and Nominated MP Kalyani Mehta had highlighted the struggles that women face in their retirement years.
They pointed out that many, especially housewives, are likely to outlive their husbands, yet they have only meagre CPF accounts to meet their retirement needs.
While the bonus will make it easier for women to join the CPF Life scheme, Mr Tharman cautioned that it is no panacea to the financial woes that many housewives face in their latter years. Family support counts too, he said.
'Government's role should not be to substitute for the responsibility of husbands and children to provide for their wives and mothers,' he said.
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