The CPF Medisave Account Minimum Sum (MA MS) has increased at an insane rate since it wasintroduced in 1984. The government says that the yearly increase is to adjust for ”healthcare inflation”. But the “healthcare inflation” was clearly government-induced through the privatisation (corporatisation) of our public hospitals.
Our highest consumer price index (CPI) since MA MS was introduced was only 6.6% recorded in 2008. However, the MA MS increased more than the highest inflation rate in 22 years!
The increase in MA MS has nothing to do with the increase in the cost of living. If fact, there is no yardstick and the PAP can suka suka increase MA MS by any amount. (see table and chart below)
1 – The MA MS increase hit double digit in 1985, 1991, 1992, 1993, 2000 and 2001. (inflation nowhere near its increase)
2 – The difference between the CPI and MA MS increase during these 6 years ranged between 7.7% and 10.5%.
3 – In 3 years when the CPI was negative, the MA MS continued to increased.
4 – The largest increase when the CPI was negative was in 1986 – the MA MS increased by 9.1%, CPI minus 1.4%.
| YEAR | MA MS | MA % INC | CPI | YEAR | MA MS | MA % INC | CPI |
| 1984 | 5000 | 2000 | 19000 | 11.8 | 1.3 | ||
| 1985 | 5500 | 10 | 0.5 | 2001 | 21000 | 10.5 | 1.0 |
| 1986 | 6000 | 9.1 | -1.4 | 2002 | 23000 | 9.5 | -0.4 |
| 1987 | 6500 | 8.3 | 0.5 | 2003 | 25000 | 8.7 | 0.5 |
| 1988 | 7000 | 7.7 | 1.5 | 2004 | 25500 | 2 | 1.7 |
| 1989 | 7500 | 7.1 | 2.4 | 2005 | 27500 | 7.8 | 0.5 |
| 1990 | 8000 | 6.7 | 3.4 | 2006 | 28000 | 1.8 | 1.0 |
| 1991 | 9000 | 12.5 | 3.4 | 2007 | 28500 | 1.8 | 2.1 |
| 1992 | 10000 | 11.1 | 2.3 | 2008 | 29500 | 3.6 | 6.6 |
| 1993 | 11000 | 10 | 2.3 | 2009 | 32000 | 8.5 | 0.6 |
| 1994 | 12000 | 9.1 | 3.1 | 2010 | 34500 | 7.8 | 2.8 |
| 1995 | 13000 | 8.3 | 1.7 | 2011 | 36000 | 4.4 | 5.2 |
| 1996 | 14000 | 7.7 | 1.4 | 2012 | 38500 | 6.9 | 4.6 |
| 1997 | 15000 | 7.1 | 2.0 | 2013 | 40500 | 5.2 | 2.4 |
| 1998 | 16000 | 6.6 | -0.3 | 2014 | 43500 | 7.4 | |
| 1999 | 17000 | 5.9 | 0.0 |
From the chart below, there is obviously no correlation between the upsized MA MS and inflation.
Corporatisation of public hospitals
The only reason for the double digit MA MS increase in the 1980’s appears to be in anticipation of the ‘restructuring’ (privatisation) of all public hospitals in the 1990’s. When public hospitals are operated as government-owned corporations, costs always escalate and the government must have already factored this into the MA MS increase. (see chart above)
It is a fact the PAP government makes money off its citizens whenever possible. Public housing, public transportation, community club tuition, etc
The PAP’s MO has remained unchanged:
1 Increase prices at its whim because there are no checks in Parliament.
2 Offer some subsidies but ensure the system is complicated.
3 The subsidies are splashed across the mainstream media to gain political mileage. (eg Medishield Life)
4 Citizens will resign to their fate after some time and adjust to the system.
Channel CPF into GIC
As is evident, there is no logic for the huge increase in healthcare savings. The MA MS doubled thrice:
– 6 years from 1984
– 8 years from 1990
-11 years from 1998
And why did the government also increased the total CPF Medisave balance by $19 billion during the last 4 years?
The actions of the government do not make any sense. If healthcare inflation needs to be checked, the solution is to bring down costs and not make citizens pay. And pay.
Conclusion
The MA MS initial huge increases were meant to support the privatisation of our public hospitals. The annual increase has no correlation with inflation, no yardstick and is based on the whims of the government. Subsequent increases appear to channel billions into GIC for state investment.
No democratic government is able to pull a fast one on its citizens in such a manner. The insane increases in the MA MS, coupled with the OA MS, have already robbed Singaporeans of our retirement savings. The government has to be a limit of tolerance has been breached.
Phillip Ang
*The writer blogs at http://likedatosocanmeh.wordpress.com/