90% backed early MPF access for the terminally ill: under a year to live, withdraw in full

This article is a rewrite of a report from September 2012.

To make MPF more flexible, the MPFA proposed letting contributors with “terminal illness” and under a year of life expectancy withdraw early — and letting retirees choose lump-sum or phased withdrawals to suit economic conditions and personal needs. Of 287 consultation submissions, 90% were in favour. The authority would put the proposals to the government, with implementation expected in 2013 at the earliest.

What was unfair about the existing law?

The MPF ordinance then allowed pre-65 withdrawals only for:

• Permanent departure from Hong Kong
• Certified total incapacity
• Early retirement at 60
• Small balances under HK$5,000 with no contributions in the past 12 months and no intention to work again

Critics noted some terminally ill contributors could die without ever qualifying — the gap the reform aimed to close.

What were the conditions for terminal-illness early withdrawal?

• Medical certification of terminal illness with under a year of life expectancy
• Certificate from one registered doctor or registered Chinese medicine practitioner
• Issued no more than 12 months before the claim
• “Terminal illness” defined in law as a life-threatening disease

What new choices would retirees get?

Members reaching retirement age or qualifying for early retirement could take benefits in a lump sum or in phases, with the authority prescribing frequencies and amounts. MPFA chairman Anna Wu said she hoped the amendments would be scrutinised in the 2012/13 legislative session for implementation in 2013 at the earliest. Implementation details still needed industry discussion, and computer systems would need updating.

A Financial Services and Treasury Bureau spokesman said the proposals would be carefully considered on receipt.