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What comprises the reserves and who manages them?


The reserves refer to the total assets minus liabilities of the Government and other entities specified in the Fifth Schedule under the Constitution1.

Government’s assets include:

  1. Physical assets like land and buildings;

  2. Financial assets like cash, securities and bonds.

Government’s liabilities include:

  1. Singapore Government Securities (SGS), which are issued for purposes of developing our domestic debt market and providing a risk-free benchmark against which other risky market instruments are priced off.

  2. Special Singapore Government Securities (SSGS), which are Government bonds issued to the CPF Board. CPF monies are invested in these special securities which are fully guaranteed by the Government. The securities earn for the CPF Board a coupon rate that is pegged to CPF interest rates that members receive.

  1. Fifth Schedule entities refer to key statutory boards and Government companies that are listed in the Fifth Schedule under the Constitution. Examples of Fifth Schedule entities are CPF Board, MAS, HDB, GIC and Temasek. The reserves of these entities are protected under the Reserves protection framework.

  2. Past Reserves are used to fund only expenditure directly related to the creation of land, but not for the construction of infrastructure on the land.

  3. Past Reserves are used to fund only the land component of the total compensation of the acquisition costs.

  4. The NIRC comprises up to 50% of the Net Investment Returns on the net assets invested by GIC, MAS and Temasek, and up to 50% of the investment income from the remaining assets.

  5. Investment gains/losses are always tracked by comparing the current market value of investments held against the historical purchase price for these investments. Capital injections do not increase or decrease the current market value or historical purchase prices of investments.

  6. See page 18-22 of the 2014 Temasek Review here.

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