[1] There were some calls to establish a central provident fund and heated debates among government, politicians and trade unions in the early 1990s.
[4] The MPFA have powers to ensure compliance, including the ability to conduct inspections, audits and investigations, and also to impose sanction on a trustee in the event of breaches of the legislation.
[8] Initially, all 300,000 employers in Hong Kong without an existing occupational retirement scheme are required to enrol their employees, in the region of 2.2 million individuals, in an MPF plan by 1 December 2000.
[8] Legislation defines three types of MPF schemes:[8] The system is mandatory for all employees in Hong Kong who have an employment contract of 60 days or more and applies also to the self-employed between ages 18 and 65.
Hawkers (street vendors), domestic employees, persons covered by statutory pension or provident fund schemes such as civil servants or teachers.
[18] Furthermore, there was disquiet among many small businesses, for which employers' MPF contributions represented a de facto 5% increase to payroll costs.
[10] When the scheme was launched, there were concerns among employee federations that due to changing life expectancy and investment returns, the assets constituting the fund at retirement would only suffice to cover living expenses for a short period.
[8] CY Leung made a pledge during the 2012 chief executive election to introduce measures to reduce the use of the offsetting mechanism progressively.
[19] However, union representatives criticised Leung for stalling on the delivery of his campaign promise as no changes had been made to the offset arrangements as at the end of October 2015.
[22] Palacio explained that contributions being made are directed at two purposes – unemployment benefit and at the same time as a pension – thus not achieving either objective.