02 August 2014

English Speech by Mr Teo Chee Hean, DPM, Coordinating Minister for National Security and Minister for Home Affairs, and Member of Parliament for Pasir Ris-Punggol GRC at the Pasir Ris-Punggol National Day Dinner

Fellow Members of Parliament 

Residents of Pasir Ris-Punggol 

Ladies and Gentlemen

1. Good evening. I am very happy to see so many of you today at this year’s National Day Dinner for Pasir Ris-Punggol residents. As we come together to celebrate National Day this year, I would like to say a little about CPF Life and Medishield Life. These are two important components of the Government’s efforts to help all of us enjoy peace of mind in our golden years. 

2. For most people, the two most important concerns about retirement are: One, whether I have enough savings; and Two, whether I can afford good healthcare.

CPF

3. We put money into our CPF when we are working, to save for our retirement. The CPF system gives fair and safe returns: Most members receive 3.5% in our Ordinary Accounts, and 5% in our Special, Medisave and Retirement Accounts.  These are guaranteed, even when markets do poorly. There is a Minimum Sum set for each cohort, which will give a monthly payout for all of your retirement years. For Singaporeans turning 55 from July 2014 to June 2015, the minimum sum is $155,000. This will give $1,200 per month for life. Those with a property, need only keep half of that in the Minimum Sum – $77,500. But that means when they retire, they will receive $600 instead of $1,200 per month for life. MediShield Life

4. Large medical bills are a big worry for our seniors. The new MediShield Life will cover all Singaporeans, for Life.  It will include Singaporeans over 90, as well as those with pre-existing medical conditions. MediShield Life will also give better protection against large medical bills than the current MediShield. This includes higher daily claims and higher payouts for treatments like chemotherapy. 

5. However, this means premiums have to go up. Government will make sure that premiums remain affordable. From next year, you will receive an extra 1% of Medisave contribution from your employer. Most Singaporean families will be able to pay for their MediShield Life premiums from their Medisave contributions. There will also be transitional subsidies for the first four years, from 2015 to 2018. Lower- and middle-income families will receive permanent subsidies. All in, Government will put in close to $4 billion over 5 years for Medishield Life.

Pioneer Generation

6. We will take good care of our Pioneers, who have worked hard to build the Singapore of today. Pioneers will receive permanent MediShield Life premium subsidies. This means that their MediShield Life premium will be lower than their present MediShield premium. They will also receive Medisave top-ups of $200-$800 every year. For Pioneers above 80, their Medisave top-up of $800 per year will be more than enough to pay for their subsidised Medishield Life premium of about $600 per month. With the top-ups, younger Pioneers from 65 to 79 years old will pay about half of the MediShield premiums that they are paying today. This will give our Pioneers better peace of mind about their healthcare bills. This will also help their families, children and caregivers to have peace of mind. From 1 September, all Pioneers will receive an additional 50% off subsidised treatments at polyclinics and Specialist Outpatient Clinics, and receive special subsidies at GP clinics under CHAS. Please join me to give a warm round of applause to the Pioneers in Pasir Ris Punggol.

Fair and Sustainable System

7. Unlike pension or health systems in many other countries, our system of CPF and MediShield Life is fair and sustainable. Each of us saves and contributes to our CPF and Medisave accounts while we are working. Employers also contribute to our CPF and Medisave accounts. And Government provides CPF and Medisave top-ups when the economy does well, especially for lower-income and older Singaporeans. This increases what we have for retirement and health care. Each of us has a part to play too – by taking care of our health, and spending wisely on healthcare and housing. 

8. With CPF and MediShield Life, Singaporeans can have peace of mind for our golden years. With a fair and sustainable system, many more generations of Singaporeans can also have peace of mind. 

9. Let us work together to build a better future for Our People, so that all Singaporeans will be proud to call Singapore Our Home. I wish all Pasir Ris Punggol residents a Happy National Day.