CPF recovered $420 million in late, under- and non-payment of CPF contributions in 2013: Tan Chuan-Jin
Manpower minister Tan Chuan-Jin announced in parliament on Tuesday that in 2013, the Central Provident Fund Board (CPFB) recovered $420 million in late, under- and non-payment of CPF contributions for more than 250,000 workers.
He said that the recovery was done using an automated system that detects late payments as well as pro-active audits on employers.
Tan announced this in response to a query by Dr Chia Shi-Lu on whether the system for detection will be improved, how it will be done and when the new detection system will be activated.
His query came in light of the Report of Auditor-General for financial year 2013 to 2014, released on 17 July. The report highlighted MOM’s “inadequate” system of checks to detect wrong payment of CPF contributions by employers for employees performing NS.
Tan further said that the CPFB "cannot carry out its audits exhaustively" on each of its 140,000 employers annually.
As with every system targeting such a large number of companies, Tan said that the ministry takes a risk-based approach, targeting enforcement effort at higher-risk industries and firms, and complementing it with investigations on complaints lodged by employees and whistleblowers.
Among the reasons for underpayment or non-payment of CPF contributions, errors made on NSmen make-up pay contribute a relatively small factor, he said.
MOM has “strengthened” its auditing process, which now requires employers to declare which of its employees have gone for National Service reservist training. CPFB will also remind employers to make CPF contributions.
According to AGO's report, there was no evidence of “independent verification” to ensure completeness and accuracy of employee wage records.
The report also said that MOM has “completed” investigations into the wrong payments and found 24 instances of underpayment and four instances of non-payments in the case of make-up pay for NSmen who attend reservist training.
The ministry has also “fully recovered” the wrong payments from employers, it said.
System migration ‘errors’ at MOH
Separately, “errors” stemmed from administration migration of IT system were to blame for the Health Ministry’s (MOH) lapse in continuing to pay $64,000 in financial assistance to 99 people after their deaths, said Health minister Gan Kim Yong in parliament on Tuesday.
The IT system migration conducted by an external vendor had resulted in the demise list not being updated, which led to the continued payment under the Interim Disability Assistance Programme for the Elderly (IDAPE).
The minister assured that the issue has been “rectified” and that the administration has been required to “make improvements” to the system, which now “triggers alerts for errors”.
The ministry has also “sought full reimbursements” of the amounts that have been wrongly paid.
