I would like to seek 2 clarifications on the Bill.
First, the new S2 (1B) defines ‘dormant account’ as one where a member has reached a prescribed age, prescribed circumstances exist, and he has not responded to the Board to confirm that he is alive. According to the new S 13 (7B), this dormant status would trigger off a count-down towards a transfer to General Moneys, where the member’s moneys will not attract interest payments.
There will be some concern about ensuring that elderly and frail CPF members, including those with stroke, dementia or who are illiterate, are not unfairly deprived of interest because they did not respond to the Board’s request. What sort of due diligence will the Board exercise before making the transfer to General Moneys? Would there be a link-up to nursing homes, welfare homes etc to account for those in care? Will there be personal visits by CPF Board officials to the member’s last known address?
Secondly, under Clause 16(a), the new S 27L(1A) provides that CPF members who have already paid premiums for CPF Life annuities when they reached 55, will be required to pay additional premiums just before they reach draw-down age (to be 65). These additional premiums will only be told to them 2 months before they reach draw-down age.
At age 55, the member would have made his selection of CPF Life annuity plan based on the premium and projections told to him then. To require him to pay additional premiums just before draw down age seems to be a retroactive requirement, since he cannot change his annuity plan unless he gets special permission then. Should the member not be given a choice whether or not to pay the additional premium?
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Webmaster’s note: This speech was delivered in the Parliament on 16 Aug 2010



