Non-residents to pay more for public sports facilities

[Barnsley]

[]
EP's used to be able to voluntarily contribute in the same amounts as citizens but that was prohibited in 2005. Why?.

I think it was way before 2005, 2002 I think ..

Btw Singapore has been prompt in returning Cpf of those who give up SC or PR.

If they had it spent on roads etc, how could they do that ? Beats me

You are joking right?

How about the fact that there are millions paying into CPF and maybe a few hundred who give up SC or PR and claim back their CPF.

[Wd40]

I think the low taxes work here because of the high density of population and it being a small city. So more tax payers per sqft of infrastructure. Also cheap foreign labor is brought in for maintenance and upkeep of the infrastructure.

[ginger_bread]

There is a big difference between tax and CPF. Maybe the government uses both tax and CPF money to fund their expenses, I don't know, but it does not mean that the CPF money subsidizes public expenditure. Funding and subsidizing are two different concepts.

When I pay tax to the government, the money is gone forever. For someone who pays into the CPF, the money is still theirs.

[JR8]

For someone who pays into the CPF, the money is still theirs.

Without wishing to sounds overly cynical - actually simply more cautionary:

-I paid into the UK National Insurance scheme for maybe 20+ years, as after 45 years of contributions that would have funded a reasonable baseline pension, enough assuming I had nothing additionally accrued to add on top (plus it was a compulsory scheme). I don't know how long the scheme had gone on for, since WW1, or WW2, totally bullet-proof, it was considered. Yet now defunct and worth more or less nothing, so little it's not worth 10 minutes of my time checking.

- Meanwhile at work, I invested something like the maximum permitted, 10-15% of my gross career pay, on top of any bonuses which I received in the majority by way of payment in lieu with corporate stock, into buying into a corporate stock plan. Some 10-15 years into that the company essentially declared bankruptcy. All that for zero.

Maybe now you see why I got into 'slow and boring' property investing, and similarly boring stock investing. I have to do something for myself, if I eff it's up it's my fault, but it's not just going to be foisted on me. I had to because everyone else but me, so far ha..., has terminally ended up poling my finances.

Be very very careful who you simply trust with your money.

[Addadude]

^^^^ THIS.

Having said that, by all accounts, CPF has a excellent track record. (Google is a wonderful tool so you don't just have to take Roy's word for it...)

The official gahment response:

http://www.mof.gov.sg/Policies/Our-Nati ... bligations

Words from somebody who is usually quite the SG gahment critic:

http://tankinlian.blogspot.sg/2014/05/y ... -safe.html

And a quote from the FB page of Mani Sabnani, the former editor of Today - who was actually fired by the gahment for the 'ungahment-friendly' tone of some of Today's articles:

"Misconceptions on the CPF, the Minimum Sum Scheme, and the state of our national reserves are worrying...

You know, I have been thinking long and hard. And it disturbs me. There is so much misunderstanding and/or misinformation about our Central Provident Fund or CPF; whether the monies are safe; why CPF does not pay higher interest rates; why the government wants the Minimum Sum Scheme and have CPF monies actually been lost by the GIC or Temasek Holdings, the two state-owned investment entities.

Well, I don't have any special inside information on GIC or Temasek or the CPF. But from memory alone and years as a journalist covering some of these issues, I can say things are not as bad as they are made out to be. Our citizens deserve better, and that includes those who rely only on the internet for their information needs.

So here goes. A few pointers and hard facts. Hand on heart, I think these are largely correct. And this is not a defence of any entitity or the government. Just facts!

1. CPF monies are in safe hands; no risk of loss. Interest rate paid by CPF is above market rates for FDs or fixed deposits. Go check it out. The CPF interest rate is an outlier i.e unusually high for a zero-risk investment. As high as 5 per cent on the first $60,000 for some people

2. The Minimum Sum Scheme is an essential one. It should be made more flexible as planned but it should not be abandoned. The original purpose of CPF was to provide some income in old age and that is what MSS does.The withdrawal age has been pushed back for good reasons overall: Singaporeans are living longer and so total withdrawal at 55 years is unrealistic. Also vast sums of CPF money have been invested in property, and having the effect of reducing cash balances meant for retirement. Some liquidity for retirement needs has to be ensured via MSS

3. There are those who say the CPF vaults are empty and that is why the payments back to citizens are being delayed. This empty vault scare is total nonsense
Our reserves per capita are one of the highest in the world.. with GIC, Temasek and the statutory boards all holding sizeable sums. Sums that have grown over the years

4. Some online commentators, with due respect, don't understand how things work. CPF basically only buys special government bonds or securities, the proceeds of which are passed on to MAS and GIC for management. Its income is assured by returns on the special govt securities that it holds.

CPF does not invest directly in the GIC portfolio orTemasek portfolio. Why? It would be too risky to do so. But the corollary of that is that CPF cannot benefit from any windfall gains made by GIC or Temasek in certain years.

5. Another fact: our currency has been strong all these years because our foreign debt is low and reserves high, with relatively low inflation to boot. Singapore govt debt, while seemingly high, is largely domestic debt. It arises mainly because of the CPF scheme to ensure forced savings for all citizens.

It's not that the government wants to hold our money or needs it. Govt is simply CUSTODIAN of our CPF savings.

6 Another fact: GIC and Temasek have done relatively well over the longer term in investments. Yes; they lost money in some investments. But overall, over many years, tbey have been doing all right. Our national reserves are now probably in excess of $600 billion on a conservative, net of debt, basis

GIC could be more transparent?: I agree. That would silence its critics. But they have their reasons. Allowing citizens to know what exactly they hold and values arising could expose the country and its reserves to unnecessary scrutiny by hedge funds and other international market players. Better to be discreet; it is part of total defence!

7.The CPF Life insurance scheme is a good one. It stretches your Minimum Sum to ensure you receive monthly payouts ALL YOUR LIFE in return for relatively low premiums. All of us should take up that option. for our own sake!

Well, you have it. The basic facts. I'm sure there will be many views. Do comment with your own perspectives."

[JR8]

Thx, interesting article.
I wasn’t suggesting CPF isn’t ‘safe’, I suppose my point was more repeating the general warning to not put all your eggs in one basket. CPF is different in that it’s income (via GIC) is diversified by investment product, sector, and geography too. I understand the annual returns are quite modest, but that's what you'd expect from something so diversified, plus, the Fund is intended as a lifetime investment vehicle, so modest returns matter far less, as long as the eventual outcome produces the desired end goal. Another adage comes to mind – ‘It’s time in the market, not timing the market’. ‘The hare and the tortoise’ is another

re: the Mani Sabnani article. It’s probably a cultural or career-experience thing, but some of his statements are things I or my former employer couldn’t have ever suggested. You know the usual disclaimer on investment products – ‘Investing is risky. The value of any investment can go down as well as up [etc*about 20 lines]’, and so on. So this came as something of a

- 1. CPF monies are in safe hands; no risk of loss.

... 'no risk of loss' was a bit of a knock-out blow, based upon which I started to write this. I agree with much of the rest.

Nothing is ever 'too big to fail', or too safe to fail. At one point in time Lehman Brothers, Enron, Equitable Life, Marconi and many others were considered that way, and many will recall what happened to all of them. Black-swan events do happen, hopefully a wise investor never forgets that.