Changes in CPF Minimum Sum, Medisave Minimum Sum and Medisave Contribution Ceiling from 1 July 2012
News Release by:
Ministry of Manpower
Central Provident Fund Board
30 May 2012 —
CPF members who turn 55 between 1 July 2012 and 30 June 2013 will need to set aside a Minimum Sum (MS) of $139,000. The MS for 2011 was $131,000.
The MS has been adjusted over the years to account for inflation, longer life expectancies and Singaporeans’ rising expectations of their quality of life post-retirement. Since 2004, the MS has been increased by $4,000 (in 2003 dollars1) each year to reach $120,000 (2003$2) in 2013, as recommended by the Economic Review Committee in 2003. The actual increases in MS are also adjusted for inflation each year.
Based on 2011 inflation and incorporating the annual $4,000 (in 2003 dollars) adjustment, the increase in MS due this year would have been $12,000, which is relatively large compared to previous years. In response to concerns over large increases in MS in any given year, we will spread out the remaining MS increases needed to reach the $120,000 (2003$) target over a longer period of four years. This means we will reach the target in 2015, instead of 2013.
With this change, the 2012 MS will be $139,000, a 6% increase ($8,000) over 2011. Without the change, the 2012 MS would have been $143,000 or a 9% increase over 2011.
Medisave Minimum Sum and Medisave Contribution Ceiling
The Medisave Minimum Sum (MMS) is the amount that a person turning 55 needs to set aside for his hospitalisation expenses in subsidised Class B2 and C wards, subsidised outpatient treatment for selected chronic conditions and basic MediShield and ElderShield premiums in his old age. Regular MMS adjustments are necessary to help Singaporeans plan for their long-term healthcare needs.
From 1 July 2012,
As announced previously, any Medisave contribution in excess of the prevailing MCC will be transferred to the member’s Special Account if he is below age 55 or to his Retirement Account if he is above age 55 and has a MS shortfall.
Source: Central Provident Fund Board