COS 2015 Debate: MOM – CPF Retirement Account (MP Lee Li Lian)

By MP for Punggol East SMC, Lee Li Lian
[Delivered in Committee of Supply on 9 March 2015]

CPF Members who have reached 55 years of age, will see a portion of their Ordinary Account and Special Account savings transferred to their Retirement Account to meet the Minimum Sum.  After setting aside the Minimum Sum cash component, funds from the Retirement Account can only be used to pay for these individuals’ housing mortgages.

[i]An article in Yahoo Finance dated 11 Feb 2014, discussed the top 3 complains Singaporeans have about their CPF accounts.  One of the complaint is ‘it is nearly impossible to access your Retirement Account (RA).’

I have come across such cases during my MPS, where residents above 55 years are unable to pay their housing loans through their Retirement Account because they have insufficient funds left over and above the Minimum Sum, and they struggle to find additional funds to pay off their housing loan installments in cold hard cash. Some of them do not even think that they stand a chance to get CPF board to allow them to use their monies in the RA and hence do not even want to try to appeal.

I have also come across residents who wish to appeal to use their CPF RA for the purpose of funding their children’s tertiary education. This will become more and more common as Singaporeans get married and have children later.  Many of them will have school-going students when they reach age 55.

I acknowledge that it is important to set aside sufficient funds for retirement. At the same time we must recognise that there are immediate financial concerns that warrant exceptions to present rules. Managing housing mortgages and cost of education are financial concerns that are important to many Singaporeans. I urge the Minister to consider allowing CPF members to use their Retirement Account to continue to pay for their outstanding mortgage loan and tertiary education of their children even if they do not meet the Minimum Sum so as not to create sudden additional financial burden to them. After all, to many of these Singaporeans, how can they possibly think about a comfortable retirement when they are still struggling with home loans and ensuring their children have a good education?  We can look at this easing of the restriction specifically for repayments of existing loans by taking a minimum number of years back.


[i] https://sg.finance.yahoo.com/news/ex-cpf-employee-exposes-3-160000084.html