Written Answer to PQ on Risk Exposure of Savings Under CPF Investment Scheme Given Historic Fall in Pound Sterling

NOTICE PAPER NO. 1463 OF 2022 FOR SITTING ON 7 NOVEMBER 2022

QUESTION NO. 3663 FOR ORAL ANSWER

CONVERTED TO WRITTEN ANSWER

MP: Dr Tan Wu Meng 

To ask the Minister for Manpower in light of the recent historic fall in the pound sterling and the rise in the United Kingdom's borrowing costs, whether the Government has assessed the extent to which Singaporeans' CPF savings invested under the CPF Investment Scheme are directly or indirectly exposed to UK gilts and pension-linked funds.

Answer:

CPF Investment Scheme, or CPFIS, is for CPF members who have the knowledge and time to invest and are prepared to take the risks. The CPFIS Self-Awareness Questionnaire introduced in 2018 was designed to help prospective CPFIS participants gauge their readiness to invest their CPF monies.

Members’ investments under CPFIS are not directly exposed to risks associated with foreign products such as UK gilts or UK pension-linked funds. This is because only products listed under the Singapore Exchange or registered with MAS are included in CPFIS. Based on our estimates, only $3.1 million out of the $22.6 billion invested in CPFIS has indirect exposure to UK gilts.

Ultimately, as with all investments, members participating in CPFIS may be better or worse off, depending on their timing and selection of investments. Alternatively, members can leave their savings in their CPF accounts and earn interest of up to 6% per annum.