Information Centre

I write to express disagreement with the letter titled “Abolish the ‘failed’ MPF and bring universal basic income payments to Hong Kong” (13 May) in SCMP which erroneously described the MPF System “not fit for purpose” and unfairly implied that MPF scheme members’ interests were neglected. 

The MPF System was established after a thorough discussion in society on how to tackle retirement protection in the face of an ageing population. A broad social consensus was reached to adopt a second pillar system under the multi-pillar retirement protection model as recommended by the World Bank.  As an employment-based, privately-managed and fully funded pension system, the MPF System is designed to provide basic retirement protection for the working population through regular contributions jointly by employers and employees.

The MPF System has grown continuously and steadily since its inception in December 2000. As at the end of December 2021, the total MPF assets amounted to around $1.18 trillion, equivalent to 121% of the Government’s fiscal reserve. Over $401.8 billion or one-third of the total MPF assets was investment returns net of fees and charges, which translate into an annualized net rate of return of 4.3% since the System’s inception, higher than the annualized inflation rate of 1.8% over the same period.

The MPFA accords the highest priority to protecting MPF scheme members’ interests through relentless efforts to recover default MPF contributions which amounted to $2.7 billion in the past years. Various reform measures were also implemented over the years to help scheme members accumulate their MPF with an average of $258,000 per scheme member as at the end of December 2021. The growing transparency of information on MPF schemes and funds, complemented by dedicated education and publicity, has helped scheme members better understand their MPF rights and obligations and better manage their MPF for basic retirement protection.

Cheng Yan-chee

Acting Managing Director

MPFA