Info Center

In his latest blog post published today (4 October), MPFA Chairman Dr David Wong looked back on the inception of the MPF System and recalled its original intent, as the System approaches its 20th anniversary in December.

Dr Wong pointed out that financial sustainability is of utmost importance for the effective implementation of the retirement protection system in Hong Kong. With reference to the second pillar under the multi-pillar framework proposed by the World Bank, Hong Kong’s MPF System is designed as an employment-based, privately managed and fully funded mandatory contribution system, which is more financially sustainable than the “pay-as-you-go” retirement systems.

Dr Wong also mentioned that the intent of the MPF System is to help the workforce develop investment discipline by making regular contributions for investment, based on the concept of “dollar cost averaging”, which together with the compounding effect, will provide greater retirement protection for employees. According to statistics provided by MPF trustees, as at the end of December 2019, the MPF accounts active since the inception of the System in December 2000 had accumulated more than $420,000 on average derived from mandatory contributions. For those with both voluntary and mandatory contributions, the average accrued benefits amounted to over $1 million.

For the full version of the article, please visit the MPFA blog. The blog is in Chinese only.

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4 October 2020