PERCENTAGE OF SELF-EMPLOYED PERSONS NOT MEETING MEDISAVE CONTRIBUTION OBLIGATIONS IN FULL IN PAST FIVE YEARS

During the pandemic period, a number of my parliamentary colleagues and I noted that a good number of Singaporeans decided to take up self-employed jobs; especially as gig workers (“SEPs”). These jobs offer flexibility and reasonable wages. One concern I had was how do we motivate our SEPs to ensure they keep aside sufficient funds in their Medisave balances for the payment of medical bills in future. The big difference is that, for employees, contributions are done automatically on their behalf by their employers whereas this is not the case for SEPs. I therefore filed a question with the Minister for Manpower asking how many SEPs did not meet their MediSave contribution obligations in full in each of the past 5 years. The Minister’s response was an eye-opener; 25%! I do think that this issue has to be addressed sooner rather than later. I note that in 2020, MOM/ CPF started a Contribute-As-You-Earn scheme with a small group of SEPs which appears to be working well to address this problem. I hope that the scheme will be extended to cover all SEPs in the private sector so that we can bring down the % before long. My question and the Minister’s answer may be accessed below.

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Mr Murali Pillai asked the Minister for Manpower (a) in each of the past five years, what percentage of self-employed persons (SEPs) did not meet their MediSave contribution obligations in full; (b) what is the corresponding dollar value of the shortfall in MediSave contributions by SEPs for each year in the same period; and © what steps are being take to enhance the number of SEPs subscribing to the Contribute-As-You-Earn scheme to allow them to make MediSave contributions as they earn.

Dr Tan See Leng : Over the last five years, the percentage of SEPs who did not keep up with MediSave contribution obligations based on declared incomes1stayed at around 25%. Over the same period, slightly more than half of these SEPs had less than $3,000 in outstanding MediSave liabilities each year.

In 2020, the Government piloted the Contribute-As-You-Earn (CAYE) scheme with a small group of SEPs who contract with the Government, to help them meet their MediSave obligations by making small and regular contributions as they earn. Almost all the SEPs in this group participated and made CAYE contributions. Following the pilot, the Government is studying the feasibility of extending the CAYE scheme to SEPs in the private sector.

Note(s) to Question No(s) 72:

1 Based on figures as at end December of each year, and include SEPs who (i) have not fully paid up their MediSave contributions, and (ii) are not on GIRO installment plans of 12 months or less.