5.

One of the areas studied by the IMC on the Ageing Population is financial security. The IMC has recommended that financial security should comprise a basic needs Central Provident Fund model, and a complementary private sector system to encourage Singaporeans to supplement their CPF savings by contributing voluntarily to private funds. The Government agrees with this recommendation.

6.

We will introduce a Supplementary Retirement Scheme (SRS), which allows Singaporeans to contribute voluntarily over and above their CPF savings. Contributions to SRS will be accorded tax deductions at the time of contribution, with tax being payable only when the savings are withdrawn. Participants will have considerable flexibility in investing their savings.

7.

The voluntary SRS contributions can only be made by employees, subject to a percentage cap based on their salary. Employers shall not contribute. SRS will not be an additional cost to business.

8.

The Government's intention is to allow foreigners who are working in Singapore to also participate if the scheme can be useful for their retirement.

9.

As the SRS is a complex scheme, details of the scheme will take time to work out. Views from the private sector will be sought on the implementation aspects. We expect to implement the scheme by next year.