CPF and the Self Employed
Many of the matured workers are also self-employed. Though the CPF scheme has worked well with the employer and employee relationship, there is a big group of people – the self-employed persons who are not so well covered by the CPF scheme.
The challenge remains: how can we get the self-employed persons to include the cost of building up their social safety net in a sustainable way when they seek to provide goods and services that are of economic value? So that when they work during their productive years, they will have a safety net when they grow old and get sick.
NTUC, together with MOM and the taxi companies have pioneered the Drive and Save scheme for the taxi drivers who are self-employed persons. It is a voluntary scheme. We want the taxi drivers to have their social safety net when they grow old or sick. The idea behind the scheme is to get both the drivers and the taxi companies to regularly contribute to the drivers' CPF Medisave when the drivers ply the streets for hire and taxi companies set the chargeable are. We have championed that the cost of taxi drivers' social safety net should be included in the price of taxi service provided by the taxi companies, just like other modes of public transport such as bus and rail.
Similar concepts or principles should be adopted to create a national CPF framework for all self-employed persons in Singapore. We should act now and address the potential social problems of an inadequate social safety net for self-employed persons.
Currently, the self-employed persons (about 137,000 self-employed Singaporean have trade net income below $ 6000 (MOH/CPF)) are mandated to contribute to their Medisave which can be used to pay for medical insurance to cover for their medical expenses should they fall ill.
This big group of self-employed persons are inadequately insured against unfortunate events such death, permanent disability, critical or chronic illnesses. Unlike employees, when such unfortunate things happen to a self-employed person, his or her whole family will fall into financial difficulty and experience great distress because they do not enjoy paid leave for medical or hospitalization and cost of medical treatment.
The existing National Health Programme (Medisave, Medishield & Medifund) will cover only the basic in-hospital expenses but not for the loss of income and recurring cost (stall/vehicle rents) when unable to work temporarily - 手停口停, which is a feature of the self-employed persons.
Just like the CPF dependant insurance scheme, we should set up an automatic opt-in basic life insurance scheme which can be paid by the CPF savings. This will further strengthen the social safety net of the inadequately insured self-employed persons, or for that matter all Singapore citizens under the CPF scheme.
When we can put our CPF savings to benefit all Singaporeans, it will also make it a stronger case for Government to give more generous CPF top-up during the years with surpluses.
