(This article was edited and first published in the 'Hammer', issue: 0902)
During the 2009 Budget Debate on 13 February, Non-Constituency Member of Parliament Ms Sylvia Lim asked the minister to review the Minimum Sum payout for elderly Singaporeans who do not have much savings in their CPF and who may not be covered by CPF Life.
A case in point: Mdm A
Ms Sylvia Lim quoted the real-life case of Mdm A, aged 69, a needy and elderly Hougang resident who had applied for welfare assistance from Hougang Constituency Committee (HGCC) in 2008.
Below is an excerpt of the interview we had with Mdm A:
HGCC Welfare (HW): Mdm A, are you staying by yourself?
Mdm A: Yes, I am staying alone. Although I have siblings, we have not been contacting each other as they have their own families.
HW: Mdm A, are you still working?
Mdm A: No, I am not. I retired early 26 years ago.
HW: Where does your income come from?
Mdm A: I receive $297 per month from my CPF but this is not been enough for me. Do you know I am currently getting less then those under the Public Assistance scheme? They are receiving $360 per month.
HW: Have you tried applying for the PA assistance scheme?
Mdm A: No, I have not. I was told that people who still have CPF savings to draw down are not eligible for PA assistance. As I do not have much in my CPF and this savings must last 20 years as required by law, I am given so little of my own money to survive on every month. The Government should allow people like us to withdraw more from our own CPF savings or to top up our minimum payout amount to match that of a PA recipient, which is $360 per month.
We did a brief calculation on her monthly expenditure based on her income of $297 a month from her CPF savings. After paying for rent, conservancy and utilities charges, she is left with about $130 per month or $4.40 per day for meals and other expenses.
Without factoring in medical expenses, this amount is hardly enough to subsist in Singapore. It saddens us to know that she has to skip her meals at times to save some money for emergency use.
People of this age group were once contributing to the growth of our country. Now that they are in their twilight years, they should be enjoying life rather than worrying everyday about how to make ends meet.
As suggested by NCMP Sylvia Lim, the PA allowance is a useful reference point to determine the floor payout of the Minimum Sum in our CPF since the Ministry of Community Development, Youth and Sports states that this allowance is “calibrated to provide for the basic living needs of PA recipients”.
So if the Government thinks that $360 per month is what a PA recipient needs for basic subsistence, then how can someone like Mdm A survive on just $200?
NCMP Sylvia Lim’s speech in Parliament
Below is an extract of Ms Sylvia Lim’s parliamentary speech:
“I would like to ask the Minister to seriously consider allowing elderly Singaporeans who do not qualify for CPF Life and PA to draw down on their CPF savings an amount equivalent to the PA allowance every month. We should not make these people worry about how to make ends meet every day in their old age.
I am not asking the government to fund the basic living needs of these elderly Singaporeans. I am only asking the government to allow these people to draw down on their OWN CPF savings an amount that can sustain their basic living needs as determined by the PA allowance.
The government may worry that these elderly Singaporeans will exhaust their CPF savings in less than 20 years. Well, if these elderly Singaporeans outlive their CPF savings, they can join the PA scheme after that. After all, the PA scheme is designed for ‘Singaporeans who are unable to work owing to old age, illness or disability to get government support’.”
The government’s response
Unfortunately Mr Gan Kim Yong, Acting Minister for Manpower, rejected the call for the government to fine-tune the Minimum Sum payout for this group of needy elderly Singaporeans.
He said: “The Minimum Sum Scheme is designed to allow members to receive monthly payouts that will last for 20 years. Increasing the withdrawal amount must mean less for the member in future. That means their savings will not last 20 years; it will be much shorter. Already, many members currently receiving the floor payout of $297 a month would not have enough savings to last the intended 20 years. In fact, with longer life expectancy, we should stretch the payout period further. Raising the floor payout would be irresponsible as it would mean that their savings would run out even faster. By then, these members may be less able to work to support themselves even if they wanted to.
The Minimum Sum is also not the only asset that CPF members have. In fact, some of them have withdrawn a significant portion of their CPF savings when they reached 55 years old. Many would have substantial housing equity in their HDB flats as well and may be eligible for the Lease Buyback Scheme. They can also seek help from their family members, such as through the Minimum Sum Topping-Up Scheme which we have just liberalised further. Those who still face difficulties can approach the CDCs, which will assess their situation and see if they are eligible for financial and other assistance.”
Conclusion
As Mdm A’s case has shown, the CPF floor payout for elderly and needy Singaporeans needs to be raised to help needy Singaporeans.
Mdm A does not have substantial housing equity in her HDB flat as it is a rental flat. She cannot rely on her siblings either, as they have their own families to take care of. Ironically, Mdm A has sufficient money in her CPF to help her live decently in her twilight years. She has the means to be self-sufficient but the government is not giving her the opportunity to do so. In fact, the Government is making her life difficult by not allowing her to withdraw her own CPF money so that she can subsist at the same level as that of a PA recipient.
Mr Gan had said: “The CPF system is premised on self-provision and self-reliance.” Isn’t that what Mdm A is hoping to do with her own CPF savings?
During the 2009 Budget Debate on 13 February, Non-Constituency Member of Parliament Ms Sylvia Lim asked the minister to review the Minimum Sum payout for elderly Singaporeans who do not have much savings in their CPF and who may not be covered by CPF Life.
A case in point: Mdm A
Ms Sylvia Lim quoted the real-life case of Mdm A, aged 69, a needy and elderly Hougang resident who had applied for welfare assistance from Hougang Constituency Committee (HGCC) in 2008.
Below is an excerpt of the interview we had with Mdm A:
HGCC Welfare (HW): Mdm A, are you staying by yourself?
Mdm A: Yes, I am staying alone. Although I have siblings, we have not been contacting each other as they have their own families.
HW: Mdm A, are you still working?
Mdm A: No, I am not. I retired early 26 years ago.
HW: Where does your income come from?
Mdm A: I receive $297 per month from my CPF but this is not been enough for me. Do you know I am currently getting less then those under the Public Assistance scheme? They are receiving $360 per month.
HW: Have you tried applying for the PA assistance scheme?
Mdm A: No, I have not. I was told that people who still have CPF savings to draw down are not eligible for PA assistance. As I do not have much in my CPF and this savings must last 20 years as required by law, I am given so little of my own money to survive on every month. The Government should allow people like us to withdraw more from our own CPF savings or to top up our minimum payout amount to match that of a PA recipient, which is $360 per month.
We did a brief calculation on her monthly expenditure based on her income of $297 a month from her CPF savings. After paying for rent, conservancy and utilities charges, she is left with about $130 per month or $4.40 per day for meals and other expenses.
Without factoring in medical expenses, this amount is hardly enough to subsist in Singapore. It saddens us to know that she has to skip her meals at times to save some money for emergency use.
People of this age group were once contributing to the growth of our country. Now that they are in their twilight years, they should be enjoying life rather than worrying everyday about how to make ends meet.
As suggested by NCMP Sylvia Lim, the PA allowance is a useful reference point to determine the floor payout of the Minimum Sum in our CPF since the Ministry of Community Development, Youth and Sports states that this allowance is “calibrated to provide for the basic living needs of PA recipients”.
So if the Government thinks that $360 per month is what a PA recipient needs for basic subsistence, then how can someone like Mdm A survive on just $200?
NCMP Sylvia Lim’s speech in Parliament
Below is an extract of Ms Sylvia Lim’s parliamentary speech:
“I would like to ask the Minister to seriously consider allowing elderly Singaporeans who do not qualify for CPF Life and PA to draw down on their CPF savings an amount equivalent to the PA allowance every month. We should not make these people worry about how to make ends meet every day in their old age.
I am not asking the government to fund the basic living needs of these elderly Singaporeans. I am only asking the government to allow these people to draw down on their OWN CPF savings an amount that can sustain their basic living needs as determined by the PA allowance.
The government may worry that these elderly Singaporeans will exhaust their CPF savings in less than 20 years. Well, if these elderly Singaporeans outlive their CPF savings, they can join the PA scheme after that. After all, the PA scheme is designed for ‘Singaporeans who are unable to work owing to old age, illness or disability to get government support’.”
The government’s response
Unfortunately Mr Gan Kim Yong, Acting Minister for Manpower, rejected the call for the government to fine-tune the Minimum Sum payout for this group of needy elderly Singaporeans.
He said: “The Minimum Sum Scheme is designed to allow members to receive monthly payouts that will last for 20 years. Increasing the withdrawal amount must mean less for the member in future. That means their savings will not last 20 years; it will be much shorter. Already, many members currently receiving the floor payout of $297 a month would not have enough savings to last the intended 20 years. In fact, with longer life expectancy, we should stretch the payout period further. Raising the floor payout would be irresponsible as it would mean that their savings would run out even faster. By then, these members may be less able to work to support themselves even if they wanted to.
The Minimum Sum is also not the only asset that CPF members have. In fact, some of them have withdrawn a significant portion of their CPF savings when they reached 55 years old. Many would have substantial housing equity in their HDB flats as well and may be eligible for the Lease Buyback Scheme. They can also seek help from their family members, such as through the Minimum Sum Topping-Up Scheme which we have just liberalised further. Those who still face difficulties can approach the CDCs, which will assess their situation and see if they are eligible for financial and other assistance.”
Conclusion
As Mdm A’s case has shown, the CPF floor payout for elderly and needy Singaporeans needs to be raised to help needy Singaporeans.
Mdm A does not have substantial housing equity in her HDB flat as it is a rental flat. She cannot rely on her siblings either, as they have their own families to take care of. Ironically, Mdm A has sufficient money in her CPF to help her live decently in her twilight years. She has the means to be self-sufficient but the government is not giving her the opportunity to do so. In fact, the Government is making her life difficult by not allowing her to withdraw her own CPF money so that she can subsist at the same level as that of a PA recipient.
Mr Gan had said: “The CPF system is premised on self-provision and self-reliance.” Isn’t that what Mdm A is hoping to do with her own CPF savings?
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