Hong Kong lawmakers urge financial reforms must move faster
Call also goes out that city's financial professionals need more help entering mainland amid possible mushrooming of free-trade zones
Lawmakers want the government to speed up its numerous financial reform plans and to go further in helping local financial professionals enter the many planned free-trade zones in the mainland.
They gave their feedback to Secretary for Financial Services and the Treasury Chan Ka-keung, who briefed legislators yesterday in a meeting about the policy address.
"There are not many promises in the policy address to clearly say how the government would help local brokers and other financial professionals develop in the mainland market,'' said Christopher Cheung Wah-fung, the lawmaker for the financial services sector.
The mainland has introduced a free-trade zone in Shanghai, with possibly more to come in Guangdong and other cities.
"These free-trade zones would offer business opportunities for local financial firms and the Hong Kong government does not yet have any plans to help the firms develop in the mainland," Cheung said.
Chan said the government would carry out reforms to help the financial sector.
"As the policy address indicated, the financial sector provides 230,000 jobs and contributes one-sixth of gross domestic product. A high quality financial services sector would enhance Hong Kong's competitiveness," he said.
Chan said the government would focus on monitoring volatile markets and carrying out reforms such as setting up the Insurance Authority, introducing government-issued Islamic bonds, and have consultations on regulating accountants. It would also hold consultations on promotion of the fund industry.
On the Mandatory Provident Fund, which covers 2.4 million employees, Chan said the government would consult the market about a standard low fee fund product while considering suggestions on how employees could have full freedom to shift their contributions to other providers by next year.
Sin Chung-kai said the government needed to do more to improve the MPF.
"The MPF management fee remains high. At the moment, employees can only shift their own contribution to other providers and not the part contributed by their employers. We also urged the government to … implement a plan to allow employees to freely shift their whole portfolio to other providers so as to add pressure on providers to cut their fees," Sin said.
The government should also change the law to ban employers from using their MPF contributions to offset long-service or severance payments - a move that many critics said eroded the retirement benefit for many employees, he said.