Effectiveness and Sustainability of the Pioneer Generation Package and Merdeka Generation Package

Parliamentary Question by Dr Lim Wee Kiak:

To ask the Deputy Prime Minister and Minister for Finance since the introduction of the Pioneer Generation Package and the Merdeka Generation Package (a) how much of the budget set aside has been spent under each package respectively; (b) how many citizens have benefited from these packages and of which, how many recipients are still alive; and (c) how has the rise in inflation impacted on the budget for these packages.

Parliamentary Question by Mr Liang Eng Hwa:

To ask the Deputy Prime Minister and Minister for Finance (a) how many seniors have benefitted from the Pioneer Generation Package and Merdeka Generation Package respectively; (b) how much money has been disbursed so far under each of the Packages; (c) whether the funds set aside for both Packages are adequate to meet future disbursements; and (d) whether projected surpluses, if any, can be used to enhance the benefits of both Packages.

Parliamentary Reply by Senior Minister of State for Finance, Mr Chee Hong Tat:

1. Mr Speaker, may I have your permission to take the next two questions together, as they pertain to the Pioneer Generation (PG) Package and Merdeka Generation (MG) Package?

2. We introduced the PG Package and the MG Package in 2014 and 2019 respectively, to honour PG and MG seniors for their contributions in the early years of Singapore’s nation-building. About 450,000 PG seniors and 500,000 MG seniors have benefited since the inception of the respective PG and MG packages. As of 30 September 2022, there are about 340,000 PG seniors and 480,000 MG seniors.

3. We established the PG Fund and MG Fund to set aside monies upfront for these packages. This ensured the Government honours our commitment to PG and MG seniors regardless of future economic or fiscal circumstances. $8 billion and $6.1 billion were set aside at the inception of the PG Fund and MG Fund respectively. We sized the funds based on the projected lifetime cost of the benefits in the PG and MG packages, after accounting for inflation and interest accrued.

4. In recent years, we have enhanced the PG and MG benefits such as the introduction of the Additional Participation Incentives for PG and MG seniors who join CareShield Life by 31 Dec 2023, and higher annual MediSave top-ups for PG seniors from 2021 onwards. The government will continue to review holistically our schemes and subsidy framework, and update the key parameters where needed, to ensure the affordability of healthcare for Singaporeans, including for PG and MG seniors. As at 31 March 2022, $3.04 billion from the PG Fund and $0.72 billion from the MG Fund have been disbursed.

5. MOF and MOH review the sufficiency of the PG Fund and MG Fund every year. As at 31 March 2022, there is a balance of $6.16 billion in the PG Fund and $5.72 billion in the MG Fund. The Government will monitor the situation and if necessary, we will top up these Funds to honour the commitments to our PG and MG seniors.

6. This is part of our efforts to prepare Singapore for an ageing society, and why the Government needs to ensure we have sufficient fiscal resources to support and care for our seniors.