Daily Lessons from Life 25 May 2014 - CPF Misconceptions Clarified and New Political Party

"CPF misconceptions clarified - CNA 25 May 2014

SINGAPORE: Manpower Minister Tan Chuan-Jin has clarified some of the misconceptions about CPF (Central Provident Fund).
His comments, made in a blog post on Sunday, come days after allegations that the government is misusing CPF money.
"CPF is a scam", "It's how the government cheats you of your money", "And it's raising the Minimum Sum to keep you from taking your money" - these are some of the talk that has surfaced online, said Mr Tan.
In his blog post, Mr Tan made three points:
CPF helps Singaporeans retire;
The money belongs to Singaporeans; and

The Minimum Sum is increasing because Singaporeans are living longer, which means there's a need to spread out payouts."

AND

"Tan Jee Say launches new political party - TODAY/CNA 25 May 2014

SINGAPORE: Mr Tan Jee Say, a former presidential candidate, has announced the formation of a new political party, Singaporeans First, which pledges to put "Singaporeans at the heart of the nation".

At a press conference on Sunday, Mr Tan announced the formation of the party and unveiled his 11-man team, which include ex-grassroot leaders, architects and former members of the Young PAP.
Outlining the party's proposed manifesto, Mr Tan said he plans to submit the party's registration latest by Monday.
The party has pledged to "put Singaporeans at the heart of the nation" and will focus on "policies to build a fair society, strong families and esteemed people".

Mr Tan said the party plans to contest in at least two Group Representation Constituencies (GRCs) in the next General Election.

Among the party's proposals are to remove the Goods and Services Tax (GST) and raise social spending.

It also wants "stronger safety nets", for example, in the form of "affordable and comprehensive healthcare insurance".

Mr Tan had contested the 2011 General Election with the Singapore Democratic Party in the Holland-Bukit Timah GRC and his team secured 39.9 per cent of the vote.
"Very specific, we want to remove the GST, because GST is unfair, it imposes an unfair burden on the lower and middle-class of Singapore. I have estimated the surpluses to be quite a lot.
"We don't have to take the principal amount, we can take the returns," said Mr Tan."

Interesting developments indeed.

Lessons for me are:

1. Minister Tan Chuan Jin, and I like the man as he seems genuine and sincere, clarification of the 3 misconceptions are perhaps NOT what Mr Roy Ngerng's blog about CPF was talking about entirely. CPF cannot be a scam as some of us did manage to get some money out above the minimal sum after hitting 55 years old. It is, in a sense, forced saving as the government see that the retirees who will live much longer will NOT be able to manage their money well; and also NOT to burden the finance of the state in future years SHOULD these old citizens become dependent on the state to fund their daily living after squandering their hard earned CPF money!;

2. 'Singapore First Party' is interesting. It can be seen as a 'right-wing' political party as it put the interests of Singaporeans first. It will appeal to many Singaporeans, who, rightly or wrongly, feel that their lots had not improved or made easier despite the miraculous progress achieved by Singapore economically. Still, I am NOT sure abolishing indirect tax like GST is the way to go! Taxing higher income earners up to a certain level DO create disincentive for they to work harder, so it is important to be careful with this personal income tax approach IF GST is abolished. A better way will be to have GST exemption on some, maybe 10-20 really essential daily items, that the ordinary folks MUST consume?;

3. With increasing political awareness by more and more Singaporeans, the NEED to EXPLAIN any doubts or squash any RUMOURS quickly, clearly and without being seen to be 'bullying or overly defensive' by the government will be absolutely critical.

One controversial topic had already been stirred up is the: how is CPF being used and IF the investment agencies entrusted with the CPF is making a lot more return, what is the 'reasonable' return to CPF owners? (assuming CPF is indeed being channelled to these investment agencies of the nation).

In this regards, Minister Tan's explanation in item 1 above probably missed the mark. I really feel that our government need to explain better as Singaporeans are, after all, more educated than in the past and are seeking to-the-point answers. Singaporeans are interested in what the government do for them. They want a prosperous, harmonious, just and fair and safe Singapore to live, raise their kids, grown old and die here eventually after 'spending their CPF money on a happy and comfortable retirement.