By MP for Punggol East SMC, Lee Li Lian
[Delivered in Committee of Supply on 7 March 2014]
CPF proceeds are distributed according to the intestacy law if the member did not make any nomination prior to his/ her death, with the exception of our Muslim friends whose proceeds will be distributed under the Administration of Muslim Law Act [1].
The intestacy law states that when a CPF member is married, it will revoke a previous nomination. However, when a member goes through a divorce, it will not revoke the previous nomination unless the member makes a fresh nomination after the divorce or remarries [2]. Unfortunately, many CPF members are not aware of this fact.
I have come across cases in Punggol East where there is confusion amongst the immediate relatives of the deceased, uncertain about where their relation’s CPF money has been transferred to. Very often, family members approach the CPF board to understand who the beneficiaries are but are turned away as this is considered confidential information.
This allocation process may not be in line with the member’s wishes and their money may not reach the people whom the member feels need it most. For example if spouse and children are financially self-reliant, the member might have wanted to provide for their elderly parents, disabled or unemployed siblings, grandchildren or even grandparents.
I would like to suggest to the Ministry to send notices to CPF members whenever their marital status changes so as to allow members to make changes to their nominations if they choose to. This will require some additional administration but it can help to eliminate confusion and pain for CPF members and their immediate families.
Section 73 of the Conveyancing and Law of Property Act (CLPA) has generated much controversy in the past [3]. One of the contributing factors was, lack of awareness, similarly to CPF nomination, members are not aware that their beneficiaries changes according to marital status. It is timely to conduct a review of the consequences of the intestacy law and greater awareness must be generated to the public on how this will affect their CPF money.
[1] http://mycpf.cpf.gov.sg/CPF/my-cpf/Losing-Loved-One/LO2.htm
[2] http://mycpf.cpf.gov.sg/NR/rdonlyres/1966CA47-EF60-42CF-B50A-064D6A274D4...
[3] http://www.ifpas.org.sg/notes/coverage/Coverage-2009-03.pdf
Source: http://wp.sg