Hong Kong's state-funded pension scheme

Hong Kong poverty commission member calls for bigger pension payout and higher asset limit

Pro-establishment lawmaker Michael Tien says government proposal is not ideal and suggests increasing monthly payout to HK$3,800

PUBLISHED : Saturday, 14 January, 2017, 4:23pm
UPDATED : Saturday, 14 January, 2017, 10:40pm

A prominent member of the government’s Commission on Poverty called for a bigger allowance and a lower threshold for a revised pension scheme, which is expected to give an extra HK$905 to about 300,000 elderly people.

Under the new proposal, which is expected to be announced in next week’s policy address, recipients whose assets are less than HK$140,000 would be eligible for a payout of HK$3,400 a month, the Post has reported.

“HK$3,400 is a rather small amount,” commission member Michael Tien Puk-sun told a radio programme on Saturday, adding that the government proposal was “not ideal”.

“People would not be able to live in dignity if they don’t have at least HK$3,900 or HK$4,000 a month,” Tien said, given more expensive rents and daily necessities.

He also urged a relaxation of the upper asset limit, as people who have a bigger reserve – which they prepare for rainy days – might also be in great financial need.

Under the current plan, of the 1.17 million Hongkongers aged 65 or above, 37 per cent – more than 432,000 – applied for the Old Age Living Allowance, which entitles them to HK$2,495 a month.

Those receiving the money cannot have assets exceeding HK$210,000.

Tien suggested the government maintain the current asset limit of HK$210,000 and raise the monthly allowance to HK$3,800, which means it will have to inject an additional HK$6 billion into the scheme.

“The amount is definitely not small. But I don’t think we can’t afford it,” he said, adding it would be a worthwhile investment.

Speaking on the same programme, Labour Party lawmaker Peter Cheung Kwok-che, who also sits on the commission, raised concerns that a universal retirement protection scheme would be delayed for at least a decade after the government’s revised scheme took effect.

“It is very obvious the government intends to replace [universal retirement protection] with the new plan,” he said.

Acting Chief Secretary Matthew Cheung Kin-chung said the government had almost completed preparation work for the policy address to be delivered by Chief Executive Leung Chun-ying on the coming Wednesday.

He said the report would provide answers in three major areas – the mandatory provident fund offset mechanism, the retirement scheme and standard working hours.

Cheung said expenditure on social welfare had increased 55 per cent to HK$66.2 billion between 2012 and last year, growing faster than government spending in other areas.

However, he also said the government would not splash money about just to buy public support, but to help disadvantage groups in need.

“I promise [the policy address] will be able to accomplish things and that the government will try its very best and race against time,” Cheung said.

The current government’s term of office ends at the end of June.

Additional reporting by Emily Tsang