Lawmakers call for rise in income thresholds for MPF
Lawmakers call for rise in income thresholds for MPF
Lam Chun-sing, second left, and Kingsley Wong, fourth left, want both lower and upper income thresholds to be raised. Photo: RTHK
Unionists called on Wednesday for adjustments to income levels for mandatory provident fund (MPF) contributions so people can enjoy better protection upon retirement.
Lawmaker Kingsley Wong, who's also chairman of the Federation of Trade Unions, said that can be achieved by adjusting the minimum and maximum levels of income on which MPF contributions are based.
These levels, he pointed out, have remained unchanged at HK$7,100 and HK$30,000 respectively for more than 10 years.
Wong suggested the income range at which contributions become mandatory be raised to between HK$10,250 and HK$50,000.
At present, those earning less than the minimum threshold per month do not have to make MPF contributions.
This is despite the latest government data showing that workers' median monthly salary now stands at HK$20,500, Wong said.
He said adjusting the income levels is crucial in terms of retirement protection.
"Based on our calculations, because our contributions for MPF are quite low, they are only sufficient to cover one third of the amount needed after retirement," Wong said.
"We will need to rely on other kinds of subsidies to fill the gap.
"If we can adjust the relevant income levels, it will be a great help."
Lam Chun-sing, lawmaker and chairman of the Federation of Hong Kong and Kowloon Labour Unions, called on the government to make MPF contributions for low-income and grassroots workers as soon as possible.
He pointed out that by adjusting the income levels, even though more low-income workers can be exempted from making mandatory contributions, this would mean that they enjoy less protection for retirement.
Lam believes the government would be able to shoulder the additional costs, as the number of low-income individuals earning less than HK$10,000 a month is low, he added.
Separately, Lam said the proposal to allow people to transfer the entire MPF amounts to a new scheme provider once per year is good for workers.
"If they can choose their own investment plan, [as] trustees also want to attract them to make investment in their funds, so there's competition," he said.
"And through market forces, [it will] encourage the trustees to improve their investment performance and lower their administrative fees, and that will benefit employees."
Currently, people can only transfer their own contributions, but not those made by their employers.
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