An unofficial history of the CPF?

My regular insider ES sent me some very interesting historical information about CPF.

… In a speech on CPF at the Pasir Panjang Forum on 31 October 1982 – the Minister for Labour and Communications said “Capital Formation: CPF savings form a large portion of Singapore’s savings. These savings are used for capital formation, which means the construction of new factories, installation of new plant and equipment, expansion of infrastructure such as roads, ports and telecommunications, the building of houses and so on”.
So, arguably Temasek Holdings’ 15 per cent annualised return from its inception was derived significantly from the state assets built up with our CPF in the early years.

… When Singapore became independent in 1965, the CPF Ordinary Account(OA) interest rate was 5.25 per cent。It increased gradually to 6.5 per cent in 1974, and remained at this rate until February  1986. In 1986, we started to peg the CPF interest rate to the banks’ interest rates. It then declined more or less gradually to 2.5 per cent in July 1999, and has remained at this rate until now.

So, arguably, 1986 may have been the turning point for Singaporeans – which may have resulted in the lowest real rate of return (on the CPF Ordinary Account)  of all national pension funds in the world since 1999.

Why was the policy changed in 1986 to peg the CPF rates to the banks’ rates, which I understand no other national pension fund in the world does?

 

Leong Sze Hian

 

 

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8 Responses to “An unofficial history of the CPF?”

  • Chris Bong:

    It all boils down to sheer arrogance. I got 70% of the vote, I own the parliament so I can do what I bloody well please. What can you do about it except to just suck it up. Dumb Singaporeans.

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  • Purity of virtue:

    The vanguard PAP were men bound to the principle of “noblesse oblige”. Once LKY had retired these founding father democrats “en masse” during the mid 80s, has there since been a party which walks with the people for the sake of the common Singaporean?

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  • Bapak:

    In a speech on CPF at the Pasir Panjang Forum on 31 October 1982 – the Minister for Labour and Communications said “Capital Formation: CPF savings form a large portion of Singapore’s savings. These savings are used for capital formation, which means the construction of new factories, installation of new plant and equipment, expansion of infrastructure such as roads, ports and telecommunications, the building of houses and so on”.
    =======================================================================

    If this is true, now they said money not enough to build infrastructure including T5 means confirmed CPF is kosong already.

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  • N.Jungne:

    I pay HDB with CPF Ordinary Account. I still earned .0.25%% with the Balancd. At that time my thought was the Government took good care of us, but not now

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  • oxygen:

    SOLD ALL MY ST IPO shares on listing debut over S$4 per share, sucker morons who bought that off me waited the next 20 years to recover his capital. And if he/she didn’t exited then, he/she waited another to recover his/her capital.

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  • oxygen:

    Ooops typo error there, sorry

    oxygen: And if he/she didn’t exited then, he/she waited another to recover his/her capital.

    should be read as

    oxygen: And if he/she didn’t exited then, he/she waited another 18 years to recover his/her capital.

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  • INDIAN malay INDIAN president:

    truth be told. from us true blue 30% Singaporeans. not from the FAKE news from pap Ljs and pap Cbs.

    this is the truth. if not for Mr Roy Ngerng’s persistent pursuit of CPF matters, 70% sheep today still being exploited by pap Ljs and pap Cbs. an example would be the FAKE agony pap puts on when pap announces each time CPF rates at 2.5%/4.0% will be maintained for the next quarter. since Mr Roy Ngerng, and these days under Mr Phillip Ang, pap suddenly does not even seem to announce anymore. BECAUSE pap realizes citizens, especially 70% sheep, know 2.5%/4.0% are daylight robbery when even next door cow boon wan malaysia easily double the 2.5%/4.%.

    although sued by pap clown, even though pap clown does not sue own blood brother and own blood sister but Mr Roy Ngerng since not same blood as clown, we happy to stick a $100 here and there for Mr Roy Ngerng. actually we have also stuck S$100, the first one, to Mr Lim Tean account to right all the CPF wrongs.

    anyway, we are grateful to folks such as Mr Roy Ngerng, Ms Han HH, Mr Phillip Ang, Mr Leong, and such. in dying Qing dynasty, it was the fearless few peasant leaders who broke the dowager dam and see how prosperous China is today. so let us 30% become 40% become 51% to set free Singapore from pap FAKE news so that our future generations can enjoy a better life, like the China Chinese today are enjoying due to the hardwork of the few peasant leaders at the time of dying Qing dynasty.

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  • C'est la vie:

    *****
    History will show, for sure, in perhaps half a century from now:

    “The greatest and most brazen heist by a Government on it’s own people ………… ever” !!!
    ***
    *****

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