The current debate over the Central Provident Fund (CPF) was sparked off by Prime Minister Lee Hsien Loong's lawsuit against blogger Roy Ngerng.

For weeks following that, Ngerng's blog set the online agenda on Singaporeans' CPF funds. The issues he raised were namely:

1) It is not clear how CPF funds are managed

2) The link between CPF, Temasek Holdings and GIC is not clear

3) The CPF minimum sum is a shifting goal post and the inflexibility of CPF withdrawals is confusing

So what's the problem now?

The first two points were addressed by Deputy Prime Minister (DPM) Tharman Shanmugaratnam who assured that the money put into the CPF by Singaporeans is invested in Special Singapore Government Securities which are guaranteed by a Triple-A credit-rated Government.

The ever-increasing Minimum Sum has also been explained by Manpower Minister Tan Chuan-Jin who noted that it is increasing because Singaporeans are living longer lives and the Minimum Sum ensures that they will have a steady stream of money in their retirement.

Even with two Ministers stepping in to clarify doubts, CPF remains an emotive topic. Dissenting comments online, whether in forums, Facebook comments off mainstream media reports or on politicians' Facebook posts, seem to fall into two major camps - one, CPF is still not forth-coming with how its monies are invested; two, CPF is my money and I should be given the right to use it as I see fit.

Why are some people still unhappy with this whole CPF thing?

The reason why the topic is emotive is simple, and it is also the reason why the CPF topic will always be an issue that will be brought up in future again - it takes money away from people. Money that they feel is theirs.

CPF is a well-celebrated pension scheme by policymakers from other countries. They want to replicate it and think of it as a policy-success.

The system is simple enough, your employer gives a percentage of your salary (16 per cent) to the CPF. On top of that, you give a percentage of your salary (20 per cent) to the CPF. But the process is automated and you usually do not get to see your 20 per cent in your pay. Your employer directly credits CPF with 36 per cent of your pay.

The government then 'borrows' this money for investment. They give you a promise of 2.5% interest returns. How else should the government give you any returns? What do you think banks do to give you your 0.125% annual returns? Keep the money in Khong Guan tins?

How do we make Singaporeans feel they are getting a good deal in all of this?

So what is the one change that will quell all this angst about CPF? The crux of the problem, as noted earlier, is Singaporeans feel that their autonomy to manage their own money has been taken away.

What if, to re-frame the entire issue, the money in CPF is not theirs to begin with?

What if the Government re-framed the entire CPF to be a pension scheme funded solely by employers instead?

Right now, the money going into CPF is directly given by employers anyway. They are essentially paying for the 36 per cent going into CPF every month. Singaporeans don't put any money into their CPF directly, unless they do so voluntarily, like topping up their SRS accounts.

Employers funding pensions has a better ring rather than a pension that is co-funded by the individual Singaporean and his/her employer.

And when you use your CPF to pay for your house, with the CPF being funded entirely by your employer, it sounds like your employer is paying for your house as well.

Are employers paying more? No. Whether they co-fund with the employees or fund the CPF accounts solely, their monthly outflow to CPF is still the same 36 per cent.

So why not?

This change will not win over dissenters' hearts immediately. But perceptions can be moulded over time.

Maybe in a decade or two, the perception that Singaporeans' hard-earned money is being locked away in a pension fund with an ever-increasing Minimum Sum will be changed to one where the Singapore Government mandates corporations to take care of its employees by looking after their retirement and housing needs.

That sounds pretty kick-ass to me. Who wouldn't want to join a company which gives us a pension and pays our mortgage?

Is there a downside to this suggestion?

Aside from being a mostly band-aid solution, employers and corporations will jump at the suggestion that they are mandated to fund their workers' retirements.

But it is in my humble opinion that it is easier to convince employers that they are not paying anything more than what they are already doing so than to convince Singaporeans that a forced savings is good for them in the long run.

So the major downside is that Singapore will look like an expensive place to operate out of. But hey, EDB has been doing a great job thus far bringing in the businesses, they just need to tweak their PR spin a little.

And on the upside, you buy the goodwill, and perhaps some votes, of the Singapore workforce. You may even boost morale and productivity. In the long run of course.

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