DAUGHTER'S CPF PAYMENT OF PARENT'S HDB FLAT (Position upon Joint Purchase of Flat with Husband)

Mr Philip Tan Tee Yong asked the Acting Minister for Labour, where an applicant and his daughter had used their Central Provident Fund savings to jointly purchase a Housing and Development Board flat and the applicant is no longer gainfully employed, whether the CPF Board will consider allowing the daughter's part to remain with her parent's flat when she applies jointly with her prospective husband to purchase a HDB or private flat.

The Acting Minister for Labour (Mr Lee Yock Suan): Mr Speaker, Sir, one of the Government's social objectives is to incul- cate filial piety and to encourage Singaporeans to live with and look after their parents. As far as possible, aged parents should not be left to live on their own and to fend for themselves.

In the situation raised by the Member, it appears socially desirable that the daughter contributes part of her CPF savings to help her parents pay for their flat if they do not have adequate CPF savings or other financial resources. However, if this involves transfer of ownership of the CPF savings, it opens up a new policy direction of the CPF Scheme which requires further consideration. At present such transfers of CPF benefits are not allowed except under the Medisave Scheme. Other factors also have to be considered.

If the parents have no other children to look after them, it is even more desirable that the daughter and her spouse share a flat with her parents. However, this may not always be feasible. For example, the spouse may have to live with his parents.

On the other hand, the young couple may have decided to buy another HDB flat to live on their own, or because they calculate that it is good investment to own two HDB flats, one for the wife's parents and one for themselves. It would not be in the national interest to facilitate such splintering of the family nucleus. Besides being socially undesirable, it would create additional demand for HDB flats which our land-scarce situation cannot afford. It would result in more aged parents living on their own, in larger HDB flats than they need.

There is therefore no simple answer to the Member's question. At present what he is proposing is not permitted under HDB and CPF rules. However, I recognize that there are exceptional cases which could be justified on hardship or other grounds. My Ministry will study with the HDB whether such applications could be considered on a case-by-case basis, bearing in mind our social objectives. If permission is granted, a decision will have to be made whether the daughter should continue to be a joint owner in her parent's flat so that the ownership of her CPF funds utilized for the flat remains with her.

Mr Chng Hee Kok (Radin Mas): Mr Speaker, Sir, to ease the burden of such families, will the Minister agree to extend the period for reimbursement of the funds to CPF?

Mr Lee Yock Suan: Mr Speaker, Sir, I am not sure in this situation whether reimbursement is needed. What I have said is that we have to look at the possibilities, and my officers will make a study with the HDB. We do have certain national objectives and priorities. I am trying to be as flexible as possible to see whether on a case-by-case basis we could allow the daughter's CPF savings to remain with the parent's flat. We have to look into the details further.

Mr Chng Hee Kok: Mr Speaker, my question really is that in any event will the Acting Minister allow an extension of time for this CPF money to be reimbursed so as to give the family time to arrange for alternative financing and so on?

Mr Lee Yock Suan: If I understand the question correctly, Sir, I think this point has already been answered by the Minister for National Development. If home buyers have difficulties servicing their housing loans for various reasons (maybe this is one such incident) the HDB might allow extension of the loan repayment period or even in certain cases suspend the payments.

Dr Augustine H.H. Tan (Whampoa): Would the Acting Minister agree with me that this question under consideration is becoming more critical as HDB is phasing out rental flats? In trying to encourage more people to purchase their own flats, if parents do not have sufficient CPF, then it will be a great help to them if part of their children's CPF could be used for this purpose.

Mr Lee Yock Suan: Mr Speaker, Sir, I am in charge of the CPF. The problem is that a lot of the issues under CPF involve other Ministries, in this case, the Ministry of National Development. So maybe the answer should appropriately be given by the Minister for National Development.