WP Rep Luis Chua: It’s time to rethink the CPF savings account formula

SINGAPORE: Labor Party MP Louis Chua (Sengkang GRC) said in a Facebook post on Tuesday, May 30: Special and Medisave accounts will rise from 4.00 percent to 4.01 percent, according to the CPF Board of Directors’ announcement on May 29.

He wrote that the general account interest rate has not changed, adding: “I have argued in Congress that the formula for OA has not changed since 1999. It is time to at least reconsider this formula and at least take the interest rate into account better.” The current nature of time deposit and savings deposit rates for three local banks, even if we want to ignore inflation in our formulas. ”

And Chua acknowledged that the increase in special and Medisave accounts “isn’t too much to say”, but at least “to ensure the lowest possible interest rate return for Singaporeans, Singapore’s interest It’s pegged to the 10-year Treasury yield.” You need long-term retirement savings. ”

He said interest rates at local banks over the past three months were “calculated to be … 0.66%, so interest rates for ordinary accounts are still the same.”

“It is clear that the interest rates are significantly higher than the 0.66% calculated by the CPF,” said Chua, referring to the fixed deposit and savings account rates of Singapore’s three largest banks, including UOB One and OCBC 360. . Or DBS Multiplier his account.

In addition, Chua said inflation was 5.7% last month, but even core inflation The change in prices for goods and services, excluding the food and energy sectors, was 5%.

“Even if inflation falls … it is quite possible that it will settle at higher levels than in recent history,” he wrote.

“I hope the government can review the CPF OA formula in a timely manner so that Singaporeans’ retirement savings can keep up with inflation, or at least reflect market interest rates. increase. #MakingYourVoteCount #workers party #CPFsg #retirement planadded GRC MP Sengkang. /TISG

WP’s Louis Chua: Inflation is a problem for many, not just low-income Singaporeans

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