No, you need not cancel your work pass. If your LTVP/LTVP+ application is approved, your work pass will be automatically cancelled when you collect your LTVP/LTVP+ card from ICA.
If you wish to continue working in Singapore, you need to indicate that you want a PLOC when applying for your LTVP/LTVP+ with ICA.
If eligible, MOM will issue you a PLOC which will allow you to work in Singapore in most jobs. There is no administrative fee for the PLOC application.