Tuesday, December 23, 2008 11:34
Recession, but MRA and food inflation up?
In Main Stories, Uncle Leong, Uniquely Spore • 1,792 views • 29 Comments
Leong Sze Hian / Columnist
Sudden jump in Medisave Required Amount (MRA)
I refer to the article, “$18,000 required in Medisave from Jan 1” (TODAY, Dec 10).
CPF members who turn 55 and are able to meet the Minimum Sum (MS) requirement – which is $106,000 currently – will still need to set aside a sum in their Medisave Accounts when making a withdrawal. From Jan 1, the sum to be set aside will be raised from the current $14,000 to $18,000.
Introduced in 2004, the Medisave Required Amount (MRA) was scheduled to increase by $2,500 each year until it reaches $25,000 on Jan 1, 2013.
The increase of $4,000 is 60 per cent higher than the original scheduled increase of $2,500.
Why the sudden huge jump in the MRA? What criteria was used to determine the MRA?
As such quantum changes affect the amount of CPF that we can withdraw at age 55, I would like to suggest that it be subject to parliamentary debate and approval.
At its current rate of increase at $4,000 a year, does it mean that the MRA will be $34,000 by 2013, instead of the originally announced $25,000?
Since from Jan 1, 2013, the MS of $134,000 (after inflation adjustment as projected by the Longevity Insurance Committee’s Report) and the MRA must be retained at age 55, does it mean that those with less than $168,000 ($134,000 MS + $34,000 MRA) will only be able to withdraw $5,000 at 55?
With the recession, retrenchments, wage cuts, and high inflation, this unexpected huge increase in the MRA may affect those who turn 55 next year and in the future, as they may have less to withdraw from their CPF to help them tide over these difficult times.
According to the Longevity Insurance Committee’s report, 60 per cent are projected to have at least $67,000 in their CPF at age 55 in 2013.
So how many Singaporeans have less than the total required sum of $168,000 at age 55 in 2013?
Food inflation despite the recession
I refer to media reports that food prices are still continuing to rise despite the recession, and media reports about Malaysia’s Domestic Trade and Consumer Affairs Minister’s success in visiting and getting hawker stalls and hypermarkets to reduce prices to help Malaysians with high inflation and the current recession. For example, about 4,500 Indian and Indian Muslim restaurants in Malaysia this week dropped their prices, as well as several hypermarket chains.
I also refer to media reports that HDB will not be deferring any of its upgrading projects. However, may not one of the causes of inflation be the upgrading of hawker centres?
After upgrading, the total rental, service and conservancy fees (S & CC), refuse fees, etc. typically increase by more than double for the existing stallholders. For those new stalls that are put up for tender, the rental can be 10 or 20 times more.
Is it any wonder, then, why food prices have gone up so much?
I think we may need to weigh the benefits of the policy of upgrading all hawker centres by 2010, in light of high inflation, recession and retrenchment, against affordability, given that the annualised median wage change was only about 3.2 per cent per annum from 1999 to 2008.
In this connection, food inflation and the overall Consumer Price Index (CPI) was 11.5 and 8.9 per cent respectively, over the last 17 months till October.
We may need to balance much higher rentals and prices against the need for “re-painting, [re-designing] for better ventilation, improved seating capacity and toilets”.
Since $4.7 billion of public construction projects have been deferred to ease inflationary pressures, why not defer the hawker centre upgrading too?
After all, isn’t rapidly-rising food inflation something which affects almost everyone, and thus, is more important and urgent to deal with?
For example, in the Bugis Albert Centre market upgrading, as less than half the original 380 stalls – 170 of them – have moved into the temporary centre, how many of the other 210 stalls have given up their livelihood, because the increased rental and other costs that may have made their businesses no longer viable?
How many would give up because they would not be able to afford the $5,000 to $9,800 (monthly $312.50 to $612.50 over 16 months) for the temporary centre?
Some of the hawkers who moved to the temporary centre have reported a drop in daily takings by more than 40 per cent.
Some hawkers in upgraded hawker centres have also reported a drop in business relative to higher costs.
There is the argument that the hawkers would be better off after upgrading, for if the hawker centres are not upgraded, they would become more run-down and customers would patronise other food places. This may be true, but on the other hand, people may avoid them because of the higher prices or cook at home instead.
Will there still be affordable food (relative to the recent past), when all the remaining 54 food centres are upgraded by 2010?
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29 Comments
All rounder
Sad
Its during the difficult times when true leadership shines. I still remember how strongly they argued and justified their million dollar salary increase but now all their great policies seem to have failed the test during difficult times. The ones who are bleeding the most are the people while these highly overrated clowns are giving excuses after excuses and making dumb statements to cover their asses.
Richard Tan
I agree with All Rounder, PAP till now still never look into the overall issues from the Financial Crisis, how to help Singapore Citizens to go through it. Their best idea are to cut our salary only, and not also lower down anything to lower down our living standard.
And still threaten us on other issues like transportation cost, S&C and now CPF MRA. What is this government? Good? or BAD?
redbean
they have locked up about $30k of my CPF in my medisave for several years. i have questioned them several times if they are violating their own regulations when the max amount required is $18k at this point in time.
could someone clarify on this or should this be raised in parliament as well?
pigscanfly
why is the goal post being shifted all the time? liddat, how to plan for retirement?
btw, there is also this automatic eldershield inclusion thingy. when you hit 40, you will get a letter telling you that now you can enjoy a “hassle-free” option to join eldershield. if you don’t do anything (ie don’t check your mail, letter is lost in transit etc etc), your money is automatically taken FROM you for payment.
wow~ i like this kind of first class “service”.
moshedyan
as usual
our government are licensed highway robbers
what so good about increasin our medicsaves
when i being a chornic sickperson
cannot utilised my whatever balances in it?
till i am dead
even when i dropped dead
i cannot used the balance medicsaves to buy my OWN coffin
it just a piece of paper to be transfer to my next of kin into his medicsave
not on his hands hor…
till today
i have yet to see the leftover medicsaves from my belated pop
may he rest in peace
from the cpf board
and yes
miss cpf ceos
take note
my belated pop
is still DEAD more than 5 years ago
still acting blurred dumb and deaf as well?
lobo76
On upgrading.
It does provide jobs (not necessarily for Singaporeans), and should somehow help the economy. I tot govt injecting funds/projects is sorta a solution for a declining economy?
However, increasing the rental is a bad idea …
sginc
When they increase prices, they will come out with 101 stupid reasons to justify for it. Remember how the public transport fare hike does not have direct connection with fuel price, as bluntly put out by the stupid Lim?
Overclock Singapore
Uniquely Singapore, another unique way to save singaporeans from recession from pumping $$ into healthcare funds. Reuters, welcome to asiaone.
Who_r_they_working_for_anyway?
Sg healthcare is getting absurd and the policies makers need to stop freewheeling and take a real good look to see if they are meeting the needs of the people.
The gahmen has all the figures of the citizen’s Medisave amounts, their average savings rate, annual healthcare costs and projected increases in future healthcare costs.
Instead of finding means to REDUCE or at least keep healthcare costs unchanged, it seems to me that they are still driving ahead with their own agenda of providing a swanky healthcare system that will eventually be beyond the means of the average Singaporean.
No matter how often the minister of health steps forward to proclaim how “affordable” healthcare is in Sg, those of us at the paying end know otherwise. As the saying goes “It is better to die early than to pay the high healthcare bills in Sg.”
So whenever I see huge plasma screen TVs or fully air-conditioned wards, perhaps it is time for the Ministry of Health to change their mindset. Instead of building the most modern, expensive, beautiful hospitals, can they build more basic buildings and provide less frills so that the average S’porean can readily afford instead of modern expensive hospitals that average S’poreans will find it hard to pay for?
After all, the average Singaporean goes to the polyclinic and hospital to get treated, not to get a visual treat. If we wanted that, we’d pay to enjoy the surroundings of Shangri-la Hotel instead.
Are the providers of healthcare here really reading the needs of the people accurately? Or are they projecting their assumptions and agendas onto their projects?
Are hospitals here meant to be showcases for the Ministers and scholars to show off to the world and get promoted? What about having hospitals places to provide a basic level a basic level of healthcare for all citizens?
As we take the first steps into a recession, perhaps Khaw and Co should reflect on their role and responsibilities to the middle and lower income citizens.
Is it time to have a healthcare system that does away with all the bells and whistles so that the extra costs will not add to the people’s financial burden especially during these trying times?.
Lastly, does anyone know if the cost of land that the hospital or polyclinic is imputed into our healthcare bill? If so, what is the basis that the hospital land is priced at?
SZ
well, the goal post is shifted as and when they need it, usually when the kitty is in need of $$$?
how much more shit must we endure from them? we are like getting endless shit for the past few years?
ronin
I have a friend who owns a hawker stall. He told me that the govt renovated the hawker centre where his stall is 3 times during the past 5 years. Each renovation takes a couple of months, at least. During the renovation periods, he has to rent a temporary stall at market rate, while at the same time, pay the loan instalment for his stall taht is undergoing renovation. The alternative is to go without any income during the periods.
Many hawkers complained, but govt turned a deaf ear!!!
SZ
12) ronin
turning a deaf ear is what they are well-versed in, ain’t it? and appeal or voice out that we have is usually met with that…
MMSMPMMC
Keep so much of our money, put in nice way is they take care of our money and invest for more returns but then cannot reveal to us the actual amount in the reserve.
Like that the whole thing is looking so ex-NKF. Keep sucking in all the funds and yet no tansparency to the public.
Let us manage our own money. Keeping a minimium amount for MR is good enough. When I retire I want to withdraw my own money to use it on my own. If they are afraid the the old folks is too senile to manage his own money then take a mental test to access the level of mental and grant the equal amount of CPF retirement fund allowed to withdraw.
Keep all our money and yet all the secrecy. F!
tiredsingaporean
I dont think so the garment have enough money now to pay those citizens their cpf withdrawal so they keep coming up with reasons after reasons to delay the payments. Can you imagine what is the total combined lost by these elites up till now is like? it’s billions of taxpayers monies, dont even adding up those multi-millions that they have put aside to provide for their obscene salaries. Now you people know why they keep saying its secrecy becos if they were to tell the truth, then they know damn well its time their entire party will collapse. Singaporeans have to keep up that fighting spirit now and cannot afford to let them continue to misuse our money anymore. If they prefer to help themselves instead of the citizens, then we singaporeans have to do what is right and just for ourselves now and protecting our nation from all these money greed leaders, which will only make the people suffer further in many more years to come, and thats our childrens.
Zeitgeist
Notice how quiet the Pinky Clown Prince Mee Siam Mai Hum Prime Minister Lee
Sien Loo had been recently? The people are in trouble, He is suppose to take the lead, a task for a country’s leader. Where is he? No balls? Or worry that the stress is going to cause the cancer to return? Millions of dollars salary woh…. Or since whatever the government is going to say are all excrements, let the well fed pets do it and take the heat?
lemans
With regards to food inflation, the key factors contributing to the increase is
(1) Higher prices of ingredients (mostly imported) and (2) the rental of premises
While we could agree that there is no much we could do with inflation from imported items, surely the authorities ( of course HDB & URA) should be responsible for pushing the rental to such an extent it could not be viable for the stallholders to absord, and have to pass on the layman (you and me).
The issue of food inflation is serious, but has been given a lip service so far.
Why? Because (1) There is not enough lobbyist around to champion the cause for the general public and consumers (2) The mainstream media is not covering this topics so they dont have to ask the Ministers (who dont have the answers) to tackle such issue.
My question is: If the World Class team cannot address the food inflation issues that’s affecting the low and middle-income singaporeans, how could the Team tackle other more pressing issues? Shouldn’t we expect 1st Class solution from a World Class team?
If I pay for a rolls royce, I expect the best, no 2nd grade.
SZ
15) tiredsingaporean
“then we singaporeans have to do what is right and just for ourselves now” you have my support on this. if this is to continue, imagine what will happen to the next gen?
and hi 17) lemans! the rise in import cost is partly due to the gahmen need to increase export, and that’s usually done at the expense of import cost *depreciation of SGD for export”
Talk to my face of caring not
Ok, i am convinced already.
There is only 1 thing left for me to do.
My decision is carved in stone.
Tan Ah Lan
As long as the people all accept this system,
I am sure there will be no change to the system.
we should not complain.
we accept the system.
we as in the majority.
wah, even must say thank you to the majority lor.
knn! kampong news networkz.
There is an urgent need to stop blatant inflation today, to cater for tomorrow. Once things get out of hand, its hard to make amends.
tiredsingaporeans
Singapore wants to become a secretive money haven and our puppies do not agreed to the Organisation for Economic Cooperation and Development’s (OECD) standards of transparency and exchange of information.
I hope OECD will continue to put more pressure on this issue. While the rich gets richer every year even in bad times, the poor and the middle class people will be suffer. This world is now nothing but a huge playground for monopoly of businesses among a bunch of dirty political crooks.
aiyoyo
aiyoyo
army got teach ma day1 – take cover!
so maybe due to this, need many reasons to take cover ma…
but if those PEOPLE do in this way,
commoners how huh? who help commoners? commoners help themself?
aiyoyo
Lee K K
I think Singaporeans, as usual, will continue to accept. MRA or no MRA.
blanket_party
Extract from Singapore to keep money rates low as economy sags
dated Dec 23, 2008
http://in.reuters.com/article/asiaCompanyAndMarkets/idINSP24212320081223
Singapore’s central bank is likely to flood the local money market with liquidity in the coming months as it prepares to let its currency weaken to head off a sharper economic slowdown, analysts said on Tuesday.
By flooding the money market with S$ to weaken our currency, imported goods that are sold in Sg will become relatively more expensive for the Singaporeans.
That is because we need to import most of our necessities from overseas and will be paying with a currency that is likely to be worth less in future.
So as the citizens are in the midst of battling recession and suffering declining wages and job opportunities, our monetary policy is weakening the purchasing power of the people.
What a double whammy.
David
To cure the root of these unhappiness, a new govt should be elected. We need to reverse all these endless suffering endurance.
tiredsingaporeans
As long as the present ruling party is in power, there will be no end to suffering. As long as singaporeans still keeping mum in regards to whatever the ruling party does to them, there will be no end to suffering.
As long as the intended GRCs are still in force till next GE, there will be no end to suffering.
As long as the ole man is still alive and kicking, there will not only be no end to suffering, infact! expect more to come . . . . . . soon!
Common Citizen.
The PAP garment is no more what it used to be in the 1960s and 1970s, where the heart if for the people.
Over the last two decades or more, IT has become the exploiter of the people, making use of the people to hold on to and prolong IT’s power, only paying lip-service and dishing out cursory peanuts and sweeteners to pretend to show IT still has a heart for the people. From the meaningless and misleading words of the present bunch of incompetent and self-over-rated world’s highest paid millionaire-aspirant ministars, we can easily sense their insincerity and hypocrisy.
It is very obvious that we are all now left by ourselves to fend for ourselves. The superficial measures that they are taking a merely cursory short-term fire-fighting actions to blur our eyes in order to tie them over once again. They do not really have any long-term measures to ensure our quality of life in the long run.
Therefore, in the next GE, we should all register a loud and clear response to these self-serving and self-enriching lot of elitists and hypocrites. May the force be with all of us, the common people in the next GE.
tiredsingaporean
Looking forward to see more screw ups and the fall of the elites that really wakes the whole nation up. So, may the force be with us all and calamities and curse be upon them this new year 2009. Live to see these criminals deminishing themselves one by one soon.
While the smart elite at TM can quote increasing 1.5% in GST to get ALL of us on free transport, yet the World Class team is not able to come up with a collective ideas to resolve and lower all these taxes, CPF MS, CPF MRA, Town Council S&C and ERP so that the overall cost of living (remember: it is NOT standard of living, don’t get mixed up and fooled) can be reduced during these trying times.
Somehow there is a mis-connect and cherry pick to select issues, to divide and conquer and to confuse the general public for what is proper and right. There is transparency at the top echoleons but not to the voters.