First, the CPF acts as an implicit tax on Singaporeans forcing you into lower earning CPF investments. Currently, CPF returns 2.5-4% beneath returns on other assets and beneath the rate of inflation incurring large losses on savers. What makes this forced saving is that it is regressive in nature. In other words, it penalizes the poor more than the wealthy. This is simply immoral. Ask yourself whether the wealthy in Singapore who make little if any forced CPF contributions would accept earning 2.5% on their investments?
Second, given that CPF contributions are invested with either GIC or Temasek, the government is essentially confiscating all returns above the CPF rate of return. This is best noted in Chart 6 of Part II. The implication here is that the Singaporean government is keeping an enormous amount of money using the retirement savings of its citizens. Full story
