Release CPF savings for hardship needs Release CPF savings for hardship needs ● 王彼得 By Peter Ong I believe more and more people today are crying out "money no enough." Having "not enough money" to spend is but a small matter. What is more troubling is having no money to meet daily expenses. Imagine a family that is short on food and the basic necessities, and the breadwinner is compelled to turn to loan sharks for money. Could this happen in Singapore? I am afraid the answer is yes. And as the number of jobless increases, more and more families are likely to meet this fate. Not long ago, Mr Lim Swee Say, NTUC Deputy Secretary-General, projected that the rate of unemployment would rise to 4 per cent before the end of the year, and reach 7 per cent next year. Given a workforce of 1.8 million, the number of unemployed could exceed 120,000. Unemployment affects both the men and women, and the young and old. But the most vulnerable are those aged 40 and above. Likely to be the sole breadwinners, these middle-aged workers hail from white- and blue-collar jobs and different educational background. Generally, when women workers are retrenched, families get to lose one of their income earners. When young workers are laid off, most of them will just fall back on their parents for financial support. And when workers about to retire lose their jobs, they can dig into their CPF savings (once they reach withdrawal age) to tide them through. However, when men aged 40 and above are asked to quit, most of them run into a dead end. Men aged 40 and above are most vulnerable because they are a favourite target for retrenchment. They are also likely to be shunned in any recruitment exercise because their salary is generally higher than young new recruits due to their longer length of service. Management realises that they could lower costs if they replace these older workers with younger but lower-salaried ones. Older workers are also likely to have greater financial commitments - such as car and mortgage loans, children still attending school and, for some, elderly parents to look after. A human resource manager from a cruise company told me recently that she detected a desperate sense of "hunger and thirst" when this category of workers showed up for job interviews. She said: "Most of them have been looking for jobs for several months. Some of them are even prepared to accept half of what they used to earn because they understand that, without any job, they would have no income. Even if they had some savings, these would be depleted in a few months' time." Nevertheless, her company's stand is to recruit the most suitable candidate-not the person who is willing to work at the lowest pay-for the job. So, even though she empathised with the candidates, she had to reject them. The manager's observations have not been off the mark. Very few Singaporeans have enough cash savings. If they lost their jobs, they would find themselves in a tight spot within a few months. Well, perhaps the salaried workers are not to be blamed for being caught in this situation. Not too long ago, it was common social practice for Singaporeans to go for an overseas holiday at least once a year. For those with more cash, they would dream of owning a car or a house. There is an even greater number of Singaporeans who do not see the need to save because they are already contributing to the CPF. I, too, often heard Singaporeans complain that they found it difficult to save because of the high cost of living. So, when the economy suddenly took a turn for the worse, many Singaporeans were caught unprepared. Even economic analysts were feeling optimistic that "tomorrow will be better" just before July last year, when the financial crises hit the region. No matter what the cause, the current economic situation has led to the emergence of a large number of unemployed Singaporeans, who are becoming increasingly anxious not only because they have no jobs, but also because they have put their families in dire straits. What can be done? Some of them are prepared to "lower their social status" and sell their car and property. But prices have dropped. Worse still, it is difficult to find a buyer at this juncture. For HDB property owners, buying and selling of flats are further restricted by government regulations. Someone once told me that Singaporeans used to be "property-rich but cash-poor." Today, they are equally poor in both aspects. Recently, the newspapers had reported that many Singaporeans tried to make ends meet by terminating their insurance policies, forgoing tuition classes for their children and even ending maids' contracts. But what about the other running household expenses-the daily meals, children's school fees, electricity bills and transport costs? I am sure no one will object if we suggest that something be done to help these financially-strapped families. The issue is: how do we help them? Unemployment subsidies? We have learnt from the experiences of other countries that this form of social welfare does not work. It not only puts a strain on the country's limited resources, but also does nothing to encourage the unemployed to look for a job. So we have to be steadfast against implementing such a measure. Lately, we have repeatedly heard a lot about structural unemployment and the government's and NTUC's efforts to encourage Singaporeans to train and re-train for new higher-skilled jobs. While these efforts are welcomed, they mean little to the unemployed, whose bank savings are fast dwindling. Moreover, training requires time and the effects will not be known till much later. Last week, the NTUC announced that it will set up a thrift and loan cooperative that can provide low-interest loans to needy workers. The labour movement hopes that the cooperative can serve as the "people's bank" and reduce their dependence on loan sharks to finance their needs. This is good news indeed, as police statistics have shown that more and more Singaporeans from the middle- and lower-income groups are resorting to loan sharks for financial help in times of difficulty. But whether the loan comes from NTUC Thrift or the loan sharks, it still has to be repaid. So, why don't we allow the unemployed to use their own money - locked in their CPF savings - to finance their own needs? The CPF started off as a savings scheme for old age. This initial purpose was considered "sacred." Today, we are even able to use our CPF savings for investments. As such, it does not make sense if our savings could not to used to meet our urgent needs in times of economic difficulties. If we view the issue from a different perspective - that is, regard savings as a protection against rainy days -then we should all the more allow those in financial difficulties to use their CPF savings to help them tide over the stormy period. After all, what we are experiencing now is an unprecedented major financial crisis. Of course, we need to ensure that there is no abuse of the system once the CPF savings are opened up for this purpose. There are several ways to go about this. For instance, the account holder can only withdraw monthly a certain percentage of his last drawn salary. He can also be allowed to withdraw his CPF savings for a period that is limited to six months or a year. The CPF Board must be satisfied that the applicant has truly been retrenched by his employer, and not someone who chose to be retrenched because he does not feel like working. The authority should also consider the applicant's family background before granting him access to the funds. The applicant must be above a certain age, and has CPF savings that exceed a certain minimum level. In addition, an applicant who was paid retrenchment benefit should be entitled to withdraw a smaller sum. Times are bad now. It is perhaps the right occasion to allow CPF account holders to dip into their savings to meet their urgent financial needs. Of course, the whole purpose is to help them tide over the difficult period and the key word is "to cope with an emergency." Given that understanding, when the economy picks up or recovers, the Board can consider getting the account holder to return (with interest) what he has taken out. After all, this is a form of borrowing. The only difference is that the applicant borrows from his own savings. This way, he does not have to turn to a banker who is likely to reject his request, or resort to loan sharks and run the risk of having them knock at your door in the middle of the night demanding repayment. （The writer is a journalist with Lianhe Zaobao's Business Desk.） 用公积金解燃眉之急 这一阵子，大叫“钱不足用”的人必然许多。 钱不足用事小，现代职业教育，最可怕是口袋没钱可用了，家中断粮断奶粉，逼 得四处找大耳窿。有这样的家庭吗？我断定有，并且跟着赋闲人口的 增加，还会越来越多。 按照全国职总副秘书长林瑞生的预测，赋闲率有可能在今年底之 前攀升到4%，明年则可能是7%；以180万就业人口来算，失去饭碗的 人有可能凌驾12万。 傍边有妇女也有男性职工，脸孔从年轻到大哥都有，不外最为脆 弱的，应该是40岁以上，靠本身一份收入撑起整个家的中年人。他们 不限于蓝领，也不限于任何教育水平。 一般上，妇女被裁，可能是双收入的家庭少了一个收入来源；年 轻人被裁，也大都可以“回”家靠怙恃；快退休的人，则差不多可以 定时领公积金。但40多的男性雇员，大都无路可退。 他们的脆弱性，主要表示在3个“最”：最容易被裁、最难找工
