Yup completely agree with you that often statistics are just political tools and often do not reflect the true situation.

With regards to actual income levels, the most reliable indicator of true wage levels is probably income tax receipts (as you have pointed out) and it is truly damning that a significant chunk of our workforce does not need to pay tax due to low wages.

It is just inane to suggest that no need to pay income tax is good if the ceiling is so low as is so often trumpeted by our leadership.

I know deoxin is extremely toxic chemical BUT THIS GENERALISATION ON FALSE PRETENSE IS ABSOLUTE THALLIUM JOKE of your caterpillar intelligence.

It is a PIG’S LIES SOLD AS PANDA GIFT. Leave this hoax in your little caterpillar-size mind INSTEAD of CORRUPTING THIS susbtance-based BLOGG

THANK YOU!!

in that sense, we can generalise that:
1. OA is employEE’s contribution
2. SA + MS are the employER’s contribution
This is a generalisation, but not unreasonable one

Bcoz all OA can be used for housing (HDB) ..whatever untouched sum in CPF can be assumed as employER’s contribution part.
If you still cash in OA n u r still paying for ur flat, that cash can be used to refinance your home loan.

If you r below 40 years old, n still paying for HDB, you can try and calculate how much of CPF has gone to pay for your flat ..n how much you hv contributed to CPF (employEE’s portion) since your very fist salary.
If you hv contributed more than u hv used for your HDB (+remaining cash in OA ..which u can use to pay n refinance ur home loan), then ..u should calculate again; it’s just impossible.

In short, in most cases, for most people …the employEE’s contribution is used fully to pay for HDB.

Yes you are damn right. It is certainly a very delicate pack of cards and should be managed carefully as otherwise, like you mentioned, it will just fall apart. However, I think our government are very capable of managing the situation because they are pojectionist in nature, i.e. they have long sighted binoculars which scour the horizon for signs of trouble and take remedial action(s) before there become a reality. I think they were frightened at the spectre that Japan is now facing at its initial stage. The Japs will in all likelihood overcome this problem because their society is closely knit and patriotisn is a unifying virtue there.

But I am not sure if the same happens to the US because theirs is a consumer system and the effects will be disastrous if it happens. Though they do not have a CPF system like us they are faced with a similar problem currently, and that is their health care system which is in the process of going into capitulation. I dread to think if the latest rescue efforts that has just been endorsed by Congress fails and what the consequences will be. Probably another drubbing of the world economic system but maybe on a lighter scale perhaps.

Regards.

@G17 & Get Real

“Why hasnt anyone questioned the validity of the statistics?”

Yes, by your illustration of numbers, myself and G17 must be way off the mark. I am debating with reliance on G17 use of GDP statistics.

I agree it is fallacious to look at GDP or GNP per capita to “measure” economic income per head. Huge distortion arise? Because GDP per capita is GDP divide by population base and GDP is simply income/profit earned inside Singapore. That would include billion dollars after-tax profits of all big corporations like SIA, Keppel Corp, Sembawang Corp, Singtel, PSA, JTC, Singapore Land Authority, TH, GIC and all foreign enterprises etc etc. Do you and I get 1 cent of these earnings unless you are a shareholder and if they are listed entities. If you are NOT like me, the GDP statistic per capita is BULLSHIT “measure” of my income – in fact a DECEPTIVE MISNOMER favoured by sleazy political mindset to deceive our loyalty votes. In Singapore were the economy is so heavily skewed by big income generators as Government sector (PSA etc) GLCs and foreign MNCs (where transfer pricing distorts income flow out of the country), the wages components to Singaporean could be very small indeed. Remember with so many foreign workers getting salaries and benefit by their employment here – Singaporean citizen’s share of wages in terms of GDP is even smaller.

That explains the GDP per capita do NOT reconcile with earned income. In fact it is said that a very large proportion of Singaporean earned less than S$20K per year and don’t even submit a tax return every year.

THAT IS WHY I DON’T BELIEVE ANY OF THOSE BULLSHIT GDP STATISTIC BOAST OF INCUMBENT GOVERNMENT NOR THEIR SUPPORTERS – ignorant, innocent or deliberate distortions they might have been guilty of wrong perspective in debate on bloggs like TR or TOC.

Do you agree now???

In the sense that our current economic strutuce at large, not the CPF in particular, requires more participants to sustain itself –

YES, we are a Ponzi, ie no new players? -> house of cards fall down.

Yup ponzi’s have nothing to do with rate differentials, the rate differentials bit was about how easy it is theoretically for the CPF to fulfill its liabilities.

Wall’o'text warning

As you have pointed out how that through the simple purchase of SG bonds (a curious creation considering the govt runs surpluses, apparently they were created due to supposed demand from capital markets – wonder where that demand came from *wink wink*) the CPF should theoretically be able to meet all liabilities due to the perfect arbitrage afforded by said SG bonds.

This perfect arbitrage combined with the CPF/govt unilateral discretion in adjusting withdrawal ages arbitrarily is theoretically a perfect model, provided administration costs do not exceed arbitrage profits and no unhedged positions are taken, as they can perfectly match their cash liabilities with their asset cash flows.

Of course the above is moot if the CPF administrators take CPF monies and chuck them in other investments hoping to make a profit to pay bigger bonuses – I have no idea whether this is the case, but wouldnt be surprised if it is as evidenced by the recent resident committee funds buying minibonds fiasco.

Why i bring up the interest rate differentials is because I believe the artificially low interest rate environment here is directly contributing to asset price inflation and creating a transitory wealth effect, in effect front loading domestic consumption.

This front loaded consumption and asset price boom is very much like the US housing boom of the early mid 2000s which drove US GDP growth in that period, and we know how that turned out when the buyers ran out.

Our govt is just doing its own version hoping that by stuffing in as much immigration as possible coupled with favorable tax treatment of foreign capital we will be able to cushion/delay the inevitable pop.

The CPF’s role is in this is in setting a rate ceiling for cost of funds for domestic capital, one which is very low.

The highest “risk free” rate that domestic savers can enjoy is the CPF rate, and when 1/3 of all domestic wages are paid into the CPF, thats alotta of dough.

The CPF isnt a ponzi scheme nor is it like some of the underfunded, mismanaged and unrealistic pension systems overseas.

It is however, INDIRECTLY providing low cost capital for reinvestment, a good thing – IF labor is able to participate and benefit from the increased production from that investment.

As it stands now capital, NOT LABOR captures a disproportionate portion of increased production.

Evidence of this is rising unemployment, declining real wages and increased cost of living (including home prices), while companies are reporting record profits and increased PAPER wealth for asset owners.

Are you so cowed by PAP that you are afraid to be truly free? Rather than working in a rat cage and staying in a pigeon hole for the rest of your pathetic life?

Are you so dim witted not to see that Singapore is heading for our ice berg and the ship will eventually sink if we allow PAP to continue its disastrous course?

Only with a two or multi party system can we avoid this ice berg by way of proper acountability and transparency in parliament. 2 MPs are not going to be able to do the job. We will need at least 20% to 40% of MPs in parliament to be able to do a good job anyway.

Yes, what you see now is the glitz and the physical materialism of success. And when the shits hits the fan, maybe you will wake up, but it will be too late.

Best to wake up now and see for yourself. You guys are living in the Matrix too long that even if freedom is given to you, you will still want to run back to your rat cage again.

And so you continue to disparage and give snide remarks to the man who is seeking to free you.

The portion from employer and the portion from employee all goes into their ordinary, special, and medisave account according to the ratio specified. There is no differential bewteen the sums received from employers or employees as they are posted to their CPF accounts according to the ratios. For retirees, there is a retirement a/c from which the balances from the ordinary and special a/cs are transferred to constitute the minimum sum.

quss13

The term of “ponzi” scheme applied to the CPF system is a reference point to show how this colossal giant operates – i.e. to highlight the operating mechanism to show how it works. Ponzi scheme does not necessarily mean it is a fraud mechanism as many are led to believe. It is only fraudulent if the proceeds received are not channelled into the various instruments to generate capital growth. So in the case of our CPF scheme it is, as I have explained earlier through my several other postings elsewhere, a mechanism used by our government as an engine to fuel economic growth over the past few decades, and we have largely been successful. The only problem is, of course, its D-Day at some future point in time if the demographic trend is declining, i.e. when a smaller workforce of CPF contributors is supporting a larger portion of retires drawing upon the resources of the system. This is the very problem which Japan is already facing, a very real problem.

The government is trying to nib the bud of the problem through piecemeal effort by encouraging foreigners to take up citizenship here (to emanate an immediate effect to prop up the kitty) whilst at the same time encouraging Singaporeans to make more babies (with a longer term view owing to the gestation period before the offsprings can reach working age).

quss13, other than your missing the intended interpretation of the term “ponzi” there I think your other comments and points are relevant and certainly logical.

Regards