Singapore in Brief

CPF Provides Fair Returns: Tharman

Deputy Prime Minister Tharman Shanmugaratnam defended the rate of return of CPF in parliament. He said that while the CPF does not give the highest returns, it provides fair returns, one of the safest returns in the world.

 

“Few systems offer a minimum rate – 3.5% on OA, 5% on SMRA. The returns are guaranteed by one of the few remaining AAA-rated governments in the world. On top of guaranteed rates, the Government subsidises CPF through the Budget.”

 

Mr Shanmugaratnam also insisted that the CPF system, on the whole, prepares Singaporeans well for the future.

 

“For several years, the OA has earned 2.5-3.5%, well above the market rates. In fact, the OA has earned more than what the 10-year SGS earns. The SMRA is pegged at a slightly generous 1% above the 10-year SGS, and the returns have been enhanced over the years. Two-thirds of CPF members earn the full 5% on SMRA. We have shielded members from the risk of low market interest rates.”

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