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Singapore Budget 2012

>> Tuesday, February 21, 2012

Deputy Prime Minister and Minister for Finance Tharman Shanmugaratnam announced the following initiatives relating to financial planning during the FY2012 Budget Statement in Parliament on 17 February 2012:

- Increase in CPF Contribution Rates for Older Workers

Lower CPF contribution rates for older workers were introduced to help improve the employability of older workers. Now, the same CPF contribution rates will be maintained for all workers up till age 55, rather than age 50. This move will encourage more workers to work longer, but at the same time, it may discourage employers to employ older workers.

In my opinion, it is definitely a good move as CPF is also used for housing loans and a decrease in contribution after 50 can have a significant impact, especially when loans nowadays stretch till most are 60s.

- Enhancement to SEC

It is good, more help for the lower wage earners. However, still no measures seen to address the sandwich class.

- One-off Medisave Top-up

Good news, bad news. A gift is a one off deal to offset the increase in premiums. However, the increase is most likely to be permanent.

- Silver Housing Bonus and Enhanced Lease Buyback Scheme

Out of all the measures, this one seems to be the most beneficial in my opinion.

Although one of the objectives stated is fair and inclusive, it seems there is an overall bias towards the older population and lower income only. It is probably meant to address the graying population issues and to assist the needy. Well, for the rest of the Singaporeans, we probably will need to wait for election year to hear inclusive good news.

4 comments:

financialray February 21, 2012 at 6:23 PM  

I think the government is making a BIG mistake when it is not doing enough to encourage young couples to have children.
Offer $20-50k to top up their CPF for each child they have so they can pay off their mortgage or buy their dream condo.
Increase the parental relief. Couples married but choose to have no kids so they can travel round the world and keep pets. They see life with kids as tough and not fulfilling.
Increase the childcare leave eligibility till child is 12 or primary 6. Parents are stressed about the children's education.

Lau February 22, 2012 at 8:56 AM  

Yes. Since gov is encouraging the birth rate to improve, budget should have been catered for things like u mention or at least minimally tax rebates or some small gesture at least.
They are targeting a segment of the population who are their existing loyalist. Wonder how this will help win votes.

financialray February 22, 2012 at 11:24 AM  

Why do Singaporeans stay in Singapore ? This is the question to pop up as early as 10-20 years down the road. We stay if we can identify with Singaporeans. Our habits, our lifestyle, our language, our culture etc.
What happens when I grow old and the people around me are from China, Philippines, Burma, Indonesia, Korea. These include your sales people, healthcare workers, waiters/waitress, managers.
By then it is no different to migrate when few Singaporeans are left in a greying population.
Yes, it maybe impossible to make the local population grow but I am sure nobody wants more foreigners to dilute the local population.
The government must at least try or seen to be trying.
Otherwise, it will be too late and IRREVERSIBLE.
LKY has seen the problem and he thinks it can be mitigated partly by immigration. Well, he also asks Singaporeans to have more babies. But where is the government show of support?
Wait till the problem is overwhelming and this marksthe end o the era of a once successful nation under LKY.

farmland investments February 27, 2012 at 10:11 AM  

That's a great idea. France has a very generous maternity leave program. Since they have implemented it, birth rates have gone up quite a bit. I think some of the Scandinavian countries have similar programs. In rich countries, decisions about children are frequently economic, and this must be taken into account in government policy.

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