The government is wrong: Universal pension scheme CAN work for all in Hong Kong, say academics
Academics put forward proposal with government, employee and business contributions that can last beyond 2064
A retirement protection scheme for all Hongkongers will be sustainable beyond 2064, according to a new scholar-backed proposal, countering government claims that such a scheme may not work.
Sixty-six Hong Kong scholars from 18 higher education institutions signed in support of the new proposal revealed yesterday. They demanded that the proposal be included in the public consultation on the topic slated for next month.
"There is no perfect solution, but at least we are proving that universal retirement protection is sustainable contrary to official rhetoric," said Polytechnic University Centre for Social Policy Studies director Professor Chung Kim-wah, who said one in every six elderly people in Hong Kong were on welfare despite the existence of the Mandatory Provident Fund (MPF) and elderly allowance schemes. "Saying that it's impossible to predict the future - how it may not be sustainable - doesn't mean we can ignore the problem now."
Scholars have criticised the government for dragging its feet, leaving a major report comprising seven proposals by notable University of Hong Kong Professor Nelson Chow Wing-sun untouched for a year and a half.
Using Chow's basic principles and the government's own projections, the scholars' proposal sees the government injecting HK$100 billion as seed money - HK$50 billion more than Chow's proposal. Also, half of all future employer and employee contributions to the MPF would also be injected into the fund.
The third contribution comes from large corporations with annual profits of at least HK$10 million through an additional profits tax of 1.9 per cent.
The academics estimate that the scheme will have HK$54.8 billion left in the pot in 2064 - when the government's latest population projection ends.
"The government has dragged its feet for so long, so the extra HK$50 billion is their responsibility as it would have been unnecessary if we had started earlier," said Chinese University associate professor Wong Hung. "For common Hongkongers - they're not contributing extra since half of their MPF will be put into the fund instead. As for the corporations, in the spirit of fairness and justice, they should take responsibility."
Wong said the proposal would be handed to the Commission on Poverty for discussion after one more round of collecting signatures. He said academic circles may boycott the December consultation if the proposal isn't included.
"It's about giving Hongkongers real choice … or else this is a skewed consultation," he added.
The scholars also criticised the government's move to "oust" any universal retirement plan.
The most recent move included altering the titles of the proposals - a means-tested scheme became a "needs-based"scheme and universal retirement protection became "a pension for those regardless of whether they are rich or poor".
The government also released for the first time an extended 50-year population projection in October, which projected a severe drop in the working population, which would render previous proposals unsustainable.
"It's obvious that they don't want to do a universal retirement protection plan ... The government is trying to make it seem that such proposals won't work so they don't have to set it up," said Chinese University assistant professor Raees Baig. "We are proving that it is possible."
