Ho Ching claims “we need to supplement CPF” as MOF Press Secretary implies CPF may not be enough as people live longer

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Chief executive of sovereign wealth fund Temasek, Ho Ching, is urging investors to invest in Temasek’s first retail bond to boost their retirement income.

In an interview yesterday, Ho Ching – who is also Prime Minister Lee Hsien Loong’s wife – said that Temasek realised years ago that people in Asia typically live longer with improved economic growth and that one of the key challenges is planning and funding retirement.

She added that while institutions like Central Provident Fund (CPF) exist for retirement planning and funding in Singapore, “we think we need to supplement it and companies can participate in this.”

Interestingly, just a day after Ho Ching implied that there is a need to supplement CPF, the press secretary to the Minister of Finance wrote in a forum letter that CPF is “adequate” for most Singaporeans – so long as they don’t live longer.

Press Secretary Lim Yuin Chien had been rebutting a Straits Times article that called on Ministers to speak plainly to the people. Fiercely defending the Government, Lim claimed that the PAP Government has been speaking plainly to the people for close to 60 years without obscuring the truth.

Besides pointing out that the ST writer helped to edit Lee Kuan Yew’s ‘Hard Truths’ book, Lim noted that the Government has been upfront with the people and named the Goods and Services Tax (GST) hike as an example where Ministers have spoken clearly to the people.

Lim also cast aspersions against Workers’ Party parliamentarians at this point and alleged: “Unfortunately, some opposition MPs sought to avoid debating this issue in Parliament, preferring to wait till the heat of the hustings, when emotions, rather than reason, rule.”

Lim further said that the call to speak plainly also applies to journalists and commentators. Asserting that the ST writer dared ministers to make sweeping promises, Lim said:
“”For example, he wants ministers to assure people that if they had “a full working life in Singapore, in any job… when you retire at 65, you will have enough to live a good and decent life”.
“”We will make sure it happens,” Mr Han urges ministers to say, “don’t worry about the details or how we will do it.”
“But plain speaking about adequate retirement would also entail telling people some “hard truths”.”

He then pointed out that while CPF is “adequate for most Singaporeans, and Silver Support will help top up for those who did not earn much while working”, it may not be enough as people live longer. Lim said: “However, as people live longer, their needs in old age will go up. Then, we will have to work longer, save more while working, or have less to spend in retirement.”

Lim’s careful statements seem to imply that he believes the CPF scheme is sufficient for most Singaporeans but may not be enough for Singaporeans who live longer. Those who live longer, thus, would need to supplement their retirement income to meet their needs in old age – this is similar to what Ho Ching and Temasek think.

Lim ended his letter by stating: “Politicians and journalists who advocate simplistic policies lose credibility, faith in democracy is undermined, and ultimately, voters or their children bear the cost…The easiest five words to utter in politics are: “I promise you free lunches.” But that’s not plain speech. That’s pandering and populism.”