Increase In Capital Sum For Eldercare Fund

23 Aug 2000

The Government has decided to increase the capital sum of the Eldercare Fund from $1 billion to $2.5 billion by 2010. The Eldercare Fund will also be extended to provide subsidies for the entire range of elderly and continuing care.

The ElderCare Fund - an endowment fund - was set up earlier this year, with an initial capital injection of $200 million. The interest income from the ElderCare Fund was to be used to finance operating subsidies to nursing homes run by Voluntary Welfare Organisations (VWOs). The original target was for this endowment fund to reach $1 billion by 2010.

As announced by Prime Minister Goh Chok Tong in his recent National Day Rally speech, the Government has decided that the ElderCare Fund should also cover community hospitals, hospices, day rehabilitation, home medical and home nursing care, in addition to nursing homes. To do so, the capital sum of the ElderCare Fund will have to be increased from $1 billion to $2.5 billion. The capital sum should then be sufficient for operating subsidies to the entire range of elderly and continuing care facilities and services to be fully financed from the interest income of the Fund.

This year, the Government will inject another $300 million into the Eldercare Fund, bringing it to a total of $500 million. We will top up the fund whenever there are budget surpluses, so that we can achieve the target of $2.5 billion by 2010.

The ElderCare Fund will not displace the role of community donations in financing step-down care for those of low and lower-middle income, as this is part and parcel of the community support structure. Hence, VWOs should continue to raise funds from the community and do their part in helping the needy and indigent patients foot their share of the charges using the donations raised.