More Evidence that Temasek Holdings Takes Our CPF to Invest!

I had asked Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam, “Secondly, Temasek Holdings has said that they do not invest our CPF, is it possible to know if in the past Temasek Holdings had invested our CPF?“

The Finance Minister had said, “No. It has never managed CPF funds.”

However, the Finance Minister went on to admit that, “Temasek started off with a set of assets which were transferred by the Government at time of inception. I don’t have the exact figure in my head – but about $400 million dollars worth of assets in the form of a set of companies.”

A speech given by the Minister for Labour and Communications in 1982 further revealed:

CPF savings form a large portion of Singapore’s savings. These savings are used for capital formation which means the construction of new factories, installation of new plant and equipment, expansion of infrastructure such as roads,’ ports and telecommunications, the building of houses and so on. These facilities coupled with Singapore’s economic and political stability have in turn attracted large amounts of investments each year. These again go into the setting up of more businesses, factories and enterprises.

Leong Sze Hian and I were able to trace how which infrastructure that CPF was invested in, and how they were then transferred to Temasek Holdings.

Temasek Holdings Has Access to Our CPF

Today, I have new evidence for you.

In the book, ‘Reforming Corporate Governance in Southeast Asia‘, it was explained that, “The second issue meriting consideration is Temasek’s utilization of Singapore’s reserves. The country’s reserves have been managed by the Government of Singapore Investment Corporation (GIC). In April 2004, a constitutional amendment that allowed the government to transfer reserves to key statutory boards and companies, and the transfer of reserves among them with the approval of the president, was introduced. Temasek Holdings has acknowledged that it can access the reserves (Temasek Holdings 2004). Both Temasek’s chairman and chief executive also have to annually certify its statement of reserves and past reserves to the president.”

According to the government, “The reserves refer to the total assets minus liabilities of the Government and other entities specified in the Fifth Schedule under the Constitution” and “Fifth Schedule entities refer to key statutory boards and Government companies that are listed in the Fifth Schedule under the Constitution. Examples of Fifth Schedule entities are CPF Board, MAS, HDB, GIC and Temasek.”.

THUS IT IS EVIDENT NOW THAT OUR CPF IS INVESTED IN THE RESERVES, WHICH CAN BE ACCESSED BY TEMASEK HOLDINGS.

The government might claim that:

An occasional misperception is that the Government made the Constitutional amendments in 2002 and 2004 to allow for the transfer of Past Reserves between Fifth Schedule entities and the Government so as to be able to conceal investment losses. This is wrong.

We have explained that a transfer of funds cannot be used to hide investment losses.

The government might also claim that:

An occasional misperception is that capital injections can be used to improve the reported returns performance of Temasek. Capital injections can enable Temasek to increase the size of its portfolio, but do not improve investment returns.

However, the evidence points to the fact that Temasek Holdings indeed has access to the reserves and Singaporeans’ CPF!

It is no wonder that at one point, the government did put on their website that, “Our reserves are managed by three agencies – the Government of Singapore Investment Corporation (GIC), Temasek Holdings (Temasek) and the Monetary Authority of Singapore (MAS).”

However, after I exposed this in 2012 and 2013, the government deleted this information from their website and replaced it:

In fact, as Associate Professor Linda Low had revealed, “since the late 1970s, CPF’s reserves as part of public sector surplus have been co-mingled with other investments either domestically by Temasek Holding Ltd or abroad by the Government Investment Corporation of Singapore (GIC).

And in fact, the CEO of Temasek Holdings, Ho Ching, and the Singapore Prime Minister Lee Hsien Loong’s wife, had in fact said in 2009, that, “While the Minister for Finance (Incorporated) is our formal shareholder, we recognise that the ultimate shareholders of Temasek are the past, present and future generations of Singapore.”

Indeed, the book ‘Reforming Corporate Governance in Southeast Asia’ had illustrated how the citizens of Singapore are the rightful and ultimate shareholders of Temasek Holdings, as Ho Ching herself has admitted.