Lively debate that keeps Mandatory Provident Fund (MPF) issues in the public domain are constructive, but the benefits of the long-term financial planning scheme need to be highlighted, according to prominent retirement fund manager RCM.
'One of the reasons MPF was introduced was to address the lack of awareness about the need for long-term retirement planning,' says Mark Konyn, CEO at MPF provider RCM Asia-Pacific.
'Unfortunately, some of the issues that have been chosen to drive recent debate have focused on the negative aspects of the MPF. The issue of administration fees and the government's plan to provide a HK$6,000 windfall for MPF members, which was reversed, have taken attention away from some of the key issues,' Konyn says.
He says important issues that need to be highlighted include the benefits of voluntary contributions, the lack of understanding concerning what Employee Choice Arrangement (ECA) means and the lack of awareness surrounding the objectives of the MPF scheme.
'The consensus among industry experts is that the MPF is still too small to help people address their financial needs in retirement,' Konyn says. 'We need to educate people and provide them with the right kind of information to help them make better financial provision for retirement.'
Konyn says, as Hong Kong couples tend to have fewer children, people who reach retirement age can no longer rely on the financial support they traditionally receive from their children.