Looking back at MPF: From Hong Kong to the SAR, it is still a product of compromise with the business community

Although the Hong Kong MPF is also managed by a statutory body, its inherent deficiencies have been criticized for many years.

The Legislative Council South East New Territories Member Lam So-wai criticized MPF for five major drawbacks during the debate on the "Revitalization of Mandatory Provident Fund" motion: first, the private companies that manage the MPF charge excessively high administrative fees; second, economic fluctuations will affect the MPF, The wage-earner pension is at risk; in addition, MPF cannot be withdrawn casually before the age of 65; in addition, the population covered by MPF and its own returns are not sufficient to form retirement protection; finally, it is difficult to manage.

Looking at Singapore's pension system, there are three pillars. The first pillar is the Central Provident Fund (CPF), which is the foundation of the entire pension system. It currently covers medical care, housing, investment and education. It is a comprehensive social system. Guaranteed savings system.

The Central Provident Fund is under the unified responsibility of the Central Provident Fund Bureau, and is highly centralized in all aspects.

The Central Provident Fund Board is an independent and semi-official management agency under the Ministry of Human Resources of the Singapore government.

The Hong Kong MPF Authority is a statutory body, but it does not dominate the entire system.

(File photo/Photo by Zheng Jianfeng)

According to Singapore's "Central Provident Fund Annual Report 2020", as of the end of 2020, the number of CPF participants reached 4.1 million, accounting for about 72% of the total population, and the total asset value reached 462.1 billion Singapore dollars, equivalent to 2.6 trillion Hong Kong dollars.

Statistics from the Hong Kong Mandatory Provident Fund Authority in March this year show that there are currently about 2.83 million people covered by MPF schemes in Hong Kong, accounting for 37.8% of the total population.

The total net asset value of all MPF schemes is HK$1.1 trillion.

In contrast, it can be seen that under the strong leadership of the government, Singapore's central provident fund has formed a certain scale.

On the other hand, the MPF system in Hong Kong was the product of the government's compromise at the very beginning of its establishment...

For details, please read the 322nd issue of "Hong Kong 01" e-weekly report (June 20, 2022) "

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