Jake's View | People know best what to do with their own money
By eating away at retirement savings, the MPF does the opposite of what it was intended to do
The Mandatory Provident Fund is a good thing because it forces very low income groups to save money, which they otherwise might not do.
This letter writer recommended a number of administrative improvements to the MPF, all of which I think are fine ideas. But the premise on which they are based I think is weak.
It has yet to be proven that low-income groups do not save money unless they are forced to do so or, if this is true, that they are not right in considering food on the table more important than investment of food money. Bear in mind the Churchillian aphorism that the best investment society ever makes is putting milk into babies.
You would ordinarily think that proving need is the foremost requirement of a mandatory retirement savings scheme. Before even suggesting such a scheme there ought to be a comprehensive survey of how much money people already save for their retirement and whether it is sufficient to cover retirement needs.
But our bureaucrats are not ordinary thinkers when pondering financial matters. They then become true out-of-the-box thinkers, looking at matters in ways that defy ordinary thought. Their decision to proceed with the MPF, for instance, was based on the observation that Singapore has a forced savings scheme and therefore Hong Kong ought to have one too.
It went no further than that. There was no survey, no in-depth study, nothing but a bald assertion that Hong Kong people do not save enough money for retirement.