CPF members above 55 may be allowed more than one withdrawal a year

CPF members above 55 may be allowed more than one withdrawal a year

The CPF Board was given more discretion in assessing such appeals and approving withdrawals from members' ordinary and special accounts, after amendments to the CPF Act were passed in Parliament yesterday.


Get the full story from The Straits Times.

Here is the transcript of the speech in Parliament:

The Central Provident Fund (Amendment) Bill 2013 Second Reading Speech by Mr Tan Chuan-Jin, Acting Minister for Manpower, 11 November 2013, 6:30 PM, Parliament

INTRODUCTION

Mister Speaker, I beg to move, "That the Bill be now read a Second time."

It is important that employers fulfil their CPF obligations to their employees. This is especially so for the lower wage and vulnerable workers, to help them save up for their retirement needs, and ensure that they benefit from Government assistance schemes such as Workfare which are implemented via the CPF system. Hence, we view non-compliance by employers of the CPF Act seriously and will take firm action against errant employers. This Bill will amend the CPF Act to support enhanced enforcement of the Act. General penalties will be increased and powers of CPF Board inspectors will be strengthened to aid investigations.

Other amendments to the Act will provide some flexibility for the CPF Board to address appeals on withdrawal frequency by CPF members above the age of 55, update pledging rules for private property and close Minimum Sum-related schemes which are no longer relevant. Various technical amendments will also be made to streamline the administration of the CPF.

ENHANCED ENFORCEMENT

Let me begin with the changes to enhance our enforcement of the CPF Act. Most employers comply with their CPF obligations, with more than 97 per cent of employers making their CPF contributions for their employees in a timely manner in a given month. However, while compliance is high, for those Singaporeans who have not received their due payments, it matters. I believe that it tends to impact the less educated and those who may be earning less, precisely those for whom the CPF contributions will help more. Since late 2012, the CPF Board has stepped up enforcement to deter errant employers who do not comply with the CPF Act. This has been complemented by outreach activities to raise awareness amongst employees and employers of their CPF rights and obligation.

The CPF Board and the Ministry of Manpower will continue to step up efforts to bring about greater compliance with the CPF Act and Employment Act to better protect employees, including under the WorkRight initiative. The review in penalties under the CPF Act will ensure that the penalties have a stronger deterrent effect on recalcitrant employers.

Increasing General Penalties

For offences under the CPF Act for which no specific penalty is prescribed, which include non-payment and late payment of CPF contributions and providing false statements, general penalties are imposed on offenders upon conviction. Currently, for such penalties, the Act prescribes a maximum fine of $2,500 for first offences and a maximum fine of $10,000 for subsequent offences. There is at present no minimum fine.

We will increase general penalties, to enhance their deterrent effect so that they are commensurate with the severity of the offences. As such, we will amend Section 61 of the CPF Act to double the maximum fine for first offences to $5,000. For offences involving payment of CPF employee contributions, we will also introduce a minimum fine of $1,000 for first offences and $2,000 for subsequent offences. All these fines apply per charge. Employers who default on their CPF contributions for months or for more than one employee can face multiple charges, and the total fine will be considerable.

In conjunction with the increase in general penalties, we will also double composition amounts, which are collected for compoundable offences, from $500 per charge to $1,000 per charge. These refer to cases where CPF Board compounds the offence by accepting the composition amount instead of prosecuting the employer if the employer has met certain conditions such as paying up CPF arrears.

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