CPF (Amendment) Bill 2023 passed in Parliament: Key changes to note

Starting 1 April 2024, non-residents’ participation in CPF schemes will be ceased. 

The CPF (Amendment) Bill 2023 was passed in the Singapore Parliament on Monday (6 November 2023), with changes made to support the retirement, housing, and healthcare needs of residents.

In an update on Monday, the Central Provident Fund Board (CPF Board) highlighted the following changes which have been made to the Bill:

1. Closure of CPF accounts of non-residents’ (non-Singapore Citizens and non-Permanent Residents)

Noting that the core purpose of the CPF system is to support the retirement, housing and healthcare needs of residents, the Board shared that starting 1 April 2024, non-residents’ participation in CPF schemes will be ceased.

In line with this, non-residents will have to transfer their CPF savings to their bank accounts by 1 April 2024, failing which their CPF accounts will be automatically closed, and any remaining savings will cease to earn the prevailing CPF interest rate. The remaining savings can still be transferred to their bank accounts at any time after that.

This was first announced in March 2023, and CPF Board is now making the necessary legislative amendments to support the automatic closure of CPF accounts. The Board has also advised non-residents to refer to the CPF website should they require more details.

In a speech in Parliament on Monday, Senior Minister of State for Manpower Koh Poh Koon addressed as a query raised on whether this cessation will cause businesses and employers to turn away from Singaporeans since employers do not have to pay additional CPF contributions for foreign workers. 

In response, SMS Koh reiterated that qualifying salaries for Employment Pass (EP) and S Pass holders are in place as a lever to ensure that non-residents are not under-cutting wages of residents. Qualifying salaries are benchmarked against local wages, inclusive of employer CPF contributions.

"The EP and S Pass qualifying salaries are benchmarked to the top one-third of local professionals, managers, executives and technicians (PMET) and associate professionals and technicians (APT) respectively. Based on the way we benchmark the wages of EP and S Pass holders, there is no wage cost advantage for employers to hire foreign professionals." 

2. Streamlining the administration of CPF schemes to improve service delivery

Under the Bill, to align with industry practices for wills and intestate distribution of assets, the Board will allow nominees and beneficiaries under the relevant intestacy laws to access deceased members’ CPF information, with effect from February 2024. Members no longer need to explicitly authorise the Board to disclose their CPF information to these individuals upon their demise.

This enables nominees and beneficiaries under the relevant intestacy laws to settle post-demise matters relating to the deceased members’ CPF accounts with greater ease and transparency.

CPF Board clarified that members' CPF information will continue to remain private and confidential while they are alive; and members may refer to the Board's FAQ page more details.

Responding to queries on this aspect, SMS Koh detailed: "On who will receive the deceased member’s CPF information, Mr Yip Hon Weng asked whether the disclosure of deceased member’s information is limited to one person or all of the next-of-kin, beneficiaries and nominees. Mr Don Wee also asked whether the information would be disclosed to a next-of-kin who is neither a nominee nor a beneficiary under the relevant intestacy laws.

"All nominees and the deceased’s beneficiaries under the relevant intestacy laws will be allowed to access the deceased member’s CPF information. To be clear, if a family relation is not considered a next-of-kin under the relevant intestacy laws, they will not be allowed access to the deceased member’s CPF information."

He continued: "Mr Saktiandi Supaat asked what percentage of CPF members gave consent to CPF Board to disclose information after death, when making their nominations of the persons entitled to receive their CPF monies upon their death. Mr Yip Hon Weng also asked whether the amendments entail information being accessed by those not intended by the deceased member.

"Today, nine in 10 members who make nominations have already authorised all their nominees to access their CPF information upon members’ demise. Hence, for the vast majority of these members today, the amendments are in in fact aligned with their intentions.

"Being able to access the deceased member’s CPF information and nomination details without requiring explicit authorisation by deceased members is aligned to industry practice for wills and intestate distribution of assets by the Public Trustee. It is intended to provide convenience to settle deceased member’s post-demise matters. It also ensures transparency so that all nominees and beneficiaries under the relevant intestacy laws are assured that the deceased members’ CPF monies have been fully accounted for."

Finally, the SMS also noted that in general, only details that will help nominees or beneficiaries under relevant intestacy laws settle the deceased member’s post-demise matters will be disclosed. This will include details of the deceased’s participation in CPF schemes but exclude details of the relationships between nominee and the deceased, as well as information on the deceased’s witnesses to the nomination.

In addition, with the amendment, the Board may continue with certain transactions, which typically arise or follow from obligations preceding the member’s demise. These include monies due to the member (e.g., refund of CareShield Life premiums to the member's MediSave account after death) or payments due to third parties (e.g., refunds to employers if there were excess CPF contributions made).

3. Notices and service methods

To facilitate more convenience, the CPF Board will be sending out more electronic documents henceforth, and this includes selected hardcopy notifications such as the Notice of Contributions issued to self-employed persons. That said, members can still request for hardcopy notifications if preferred.

In addition to the above, to align with the legislation governing other public sector agencies, changes to the Notice to Attend Court document can now be made without having to amend the subsidiary legislation. A sample copy of the “Notice to Attend Court” document will be made available on the Board’s website for easy access in the event a member needs to verify the legitimacy of any notice served.

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Photo: Screenshot of live stream, MCI YouTube