The Government introduced the Mandatory Provident Fund (MPF) Scheme in December 2000, with the aim of assisting our working population to save part of their income for investment to help safeguard life in retirement. Upon implementation of the MPF Scheme, Hong Kong has in place the
"Three Pillars" for retirement protection advocated by the World Bank, the others being the
"social safety net" long established by the Government and personal savings and insurance.
However, I understand that some people faced with the need to make ends meet may not have any extra money to save up for their retirement life after making statutory MPF contributions. To demonstrate the Government’s commitment to enhancing retirement protection and relieving the pressure on social welfare expenditure in the long run, for employees and self-employed persons who currently have MPF accounts and who each earns not more than $10,000 a month, I propose to make a one-off injection of $6,000 into their MPF accounts.
At present, members of some occupational retirement schemes do not have MPF accounts. If their occupational retirement scheme is a defined contribution scheme, their accounts under such a scheme will also be entitled to the proposed fund injection. The Financial Services and the Treasury Bureau will announce the details.
I have earmarked $8.5 billion to implement this measure. It requires amendment to the existing Mandatory Provident Fund Schemes Ordinance. I expect that the funds will be injected into the MPF accounts in 2008-09 upon completion of the relevant procedures.