1. Our CPF system has served Singaporeans well. It has done this by evolving over the years, so that it responds to the needs of each generation of Singaporeans.

2. It never was a perfect scheme but, together with our HDB policies, it is regarded as one of the better retirement schemes around the world. We have to keep evolving it, and we will, to ensure that it continues to serve Singaporeans well.

3. The changes have been significant over the years.

a. In the first phase of the CPF, when Singapore was a developing country, people were largely poor and home ownership was limited, CPF was a simple scheme.

i. It reflected the times.

ii. In substance, it worked like a savings scheme for home ownership, rather than a scheme for retirement income. Most of a member’s CPF money could be withdrawn for housing. There was no Special, Retirement of Medisave account aimed at meeting spending needs in old age. Savings could be withdrawn at 55, with no requirement to ensure a stream of income for basic spending through life.

iii. Over 90% of elderly Singaporeans own their homes.

iv. Unlike many other countries, ordinary workers including lower income Singaporeans, not just the middle class or higher income group, benefited from owning a housing asset. They need not use retirement savings to pay for rentals, and most in fact have substantial assets.

v. However, many Singaporeans in that older generation are asset rich