As I read the numerous threads and posts about the CPF mess that we are in I realised many of us have little ability to frame the key issues and address them. The end result is a confused mess.
The peasants have been so conditioned by Pappy propaganda down the years that they've forgotten what CPF is all about.
In a nutshell:
1. CPF is an individually-funded
retirement fund, not your grandaddy's slush fund.
2. CPF has
failed as a pension fund, given that more than half of all Singaporeans cannot meet the minimum sum requirement.
Its fundamental flaws:
1. ROI on CPF savings, esp. the OA, are ridiculously low and not indexed to inflation.
2. Allowing CPF funds to be used for property and other investments means that as land prices soared, CPF funds get depleted.
3. CPF contribution quantum is pegged to individual income. As S'pore's wages are among the lowest in the dev. world (no minimum wage, unbridled foreign worker influx), CPF contributions have remained stagnant for the lower income group while cost of living has sky-rocketed.
Net result:
Inadequate savings to meet old age needs
Key issues:
1. Increase
transparency and accountability as regards how our funds are invested by MAS, GIC and TH and what returns are obtained
2. Interest paid on OA must be
pegged to inflation
3. Since TCJ has acknowledged that
CPF is our money, return all CPF monies to holders at age 55 and make annuity schemes optional.
Myths:
1.
Increasing minimum sum solves the problem. Bollocks. Increasing minimum sum actually
exacerbates the problem of inadequate savings, results in low-income folks not being able to access their own savings for subsistence when they hit 55.
2.
Increasing draw-down age solves the problem. Bullshit. Again, problem is lack of savings; increasing drawdown age merely puts whatever little money is left in the piggy bank out of reach of the people who need it most.
