The government is wrong: Universal pension scheme CAN work for all in Hong Kong, say academics

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.