Mr Lee said the CPF interest rate is better than that given by the banks, and he had a tip for wives.
"All the women should tell their husbands that the government's CPF interest rate is now very high, better than the POSBank anytime so better take your money from your POSB (account) and put into my CPF account," he quipped.
The extra one percentage point given by the CPF Board is something Singaporeans will find hard to get anywhere else.
Mr Lee said: "The government is taking care of it – 100-percent risk free. The money is there, it will never disappear. People say go with GIC, Temasek; GIC makes so much money, you should give me the same like GIC. But GIC invests long-term – they buy shares, the stock market goes up, the stock market goes down.
"(In the) last few months, the stock market has gone down. I am sure GIC's portfolio would have gone down. And not just your interest is less – that means your capital gets less. I was persuaded by MOM (Ministry of Manpower) and MOF (Ministry of Finance), against my preference, that it's better for the government to take on this responsibility for the first S$60,000 because it's a big burden."
The fallacy in PM Lee's logic is, if the stock market goes down you lose capital; but then again when the stock market falls, it will recuperate again, since the beginning of wall street, it has always been so. Not every CPF members withdraw their money when market is bad, because they can only withdraw when they reached their retirement age. So in time, the ups and downs of the stock market will average out (some years stock market drop, sometimes it booms). The P4P government if they want to benefit the citizens, should pay the average returns of stock market (in interest rates) for CPF members.
The CPF is not really equivalent to banks because the money you put in the bank, it's very liquid (meaning you can withdraw the money anytime you so choose). Whereas the CPF is more like an insurance scheme (more restrictions than insurance scheme because it's compulsory), you are bonded for life.
PM Lee trying to hoodwink those without financial intelligence. Do you think HC will ask PM Lee to put all their money in CPF?
