Business Opposes Raising MPF Contribution Ceiling — “Adding Insult to Injury”; Semi-Portability Eyes H2 Next Year

The government proposed raising MPF’s maximum relevant income from HK$20,000 to HK$25,000, effective 1 June 2012. At LegCo’s 31 July 2011 hearing, business groups said higher contributions would pile pressure on already-strained operations.

How did business object?

Operating pressure is already severe. The catering industry’s Inaka Institute cited rising food costs and the new minimum wage; the Chinese Importers’ and Exporters’ Association said SMEs would suffer and suggested HK$22,500 instead. Multiple groups urged the MPFA to rein in intermediaries so members’ contributions aren’t eaten away.

What did the government say?

Treasury official Wong Kwok-ling said the law requires a review of income thresholds every four years — the ceiling should have risen to HK$30,000 years ago, and the delayed June implementation already accounts for employers’ cash flow and members’ adjustment; she conceded management fees still have room to fall.

When is semi-portability coming?

Target: second half of next year. The MPFA finished consulting on intermediary regulation for the Employee Choice Arrangement (2.5 million employees), receiving just 13 written submissions; the bill goes to LegCo in Q4, alongside rules mandating designated e-systems for trustees to process transfers.