Ensuring Long-term Sustainability of Pioneer, Merdeka Generation and Majulah Package Funds to Prevent Top-ups from Future Budgets

Parliamentary Question by Mr Yip Hon Weng:

To ask the Prime Minister and Minister for Finance following the Estimates Committee’s call for greater transparency on the sustainability of the Pioneer, Merdeka Generation and Majulah Package Funds (a) whether updated planning assumptions and stress-test ranges will be published; (b) which indicators will trigger top-ups; and (c) how does the Government plan to avoid large, delayed top-ups that may fall on future Budgets.

Parliamentary Reply by Second Minister for Finance, Mr Jeffrey Siow:

At the inception of the PG Fund in 2014, $8 billion was set aside based on estimated funds required to fulfil the commitment to PG seniors. As of 31 Mar 2026, the PG Fund had an estimated liability of $5.75 billion, compared with a balance of $4.84 billion.

The difference has arisen mainly because healthcare costs and MediShield Life premiums have increased faster than expected. There have also been enhancements to the support provided to PG seniors, including the CareShield Life Additional Participation Incentives, which have added modestly to the Fund’s liabilities.  

These estimates will inevitably change over time. We therefore closely monitor the Funds’ balances, estimated liabilities, and utilisation trends.  We do not seek to keep each Fund’s balance exactly matched to its estimated liabilities at any point.  But the Government will make fund top-ups as needed, taking into account the size of any estimated shortfall and the overall fiscal position. This approach avoids reacting to any short-term fluctuations, while ensuring that the commitments made to our seniors remain fully funded over time.

Key information on each Fund, including its balance, annual inflows and outlays, is published in its financial statements.