Govt urged to do more to improve CPF returns

Govt urged to do more to improve CPF returns

SINGAPORE - Two Members of Parliament want the Government to take the lead in helping Singaporeans to earn higher returns on their Central Provident Fund (CPF) savings.

The call was made by Mr Zaqy Mohamad (Chua Chu Kang GRC) and Nominated MP Tan Su Shan, who is a senior bank executive.

Mr Zaqy has proposed that the Government initiate and lead an investment plan that will offer higher interest rates and take into account inflation.

He made the call in a wide-ranging speech which kicked off the debate yesterday, thanking President Tony Tan Keng Yam for his address on the Government's directions in the second half of its term.

Mr Zaqy called for better communication of public policies and retirement adequacy, among other things. By improving returns on CPF savings, the Government can reduce unhappiness with the "changing goal posts" of the minimum sum, he said, referring to the increases in the minimum sum requirement to meet longer lifespans and rising costs.

The CPF system has recently come under fire online, as the minimum sum is set to increase from $148,000 to $155,000 from July 1. It is set to go up again in July next year but the amount has not been determined.

The criticism prompted Manpower Minister Tan Chuan-Jin to defend the national pension fund in a blog post on Sunday.

In her speech, NMP Tan suggested having regular savings plans that are tied to bonds or fixed-income unit trusts that pay regular dividends.

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