ABSTRACT

The Central Provident Fund (CPF) is a compulsory national social security scheme to provide working Singaporeans with retirement income. It was founded on the principles of self-provision and self-reliance where citizens set aside money for their retirement. The high CPF contribution rates became a concern for employers, due to the implications on labour cost especially during bad times. The employee CPF contribution rate for workers in the age group of 50–55 was gradually lowered from 20 per cent to 19 per cent in January 2005 and to 18 per cent in January 2006. The Public Housing Scheme was launched in 1968 to help Singaporeans use their CPF savings to buy government-built homes. Medisave was introduced as part of the National Health Plan in 1984 to help CPF members build up sufficient savings for hospitalization expenses, especially during old age.