Experts raise concerns about MPF early withdrawal proposal

(Editor’s note: this report was originally in English and is rewritten in Chinese per this site’s practice.)

Experts have raised concerns about the new MPF early-withdrawal proposal. The changes go to the MPFA board this September, then to public consultation, before the government considers them. MPFA chairman Anna Wu said the authority is weighing early withdrawal for members with serious illness who also face financial hardship before the retirement age of 65 — a gesture of sympathy for members in need.

Who can apply for MPF early withdrawal?

Members with serious illness facing financial hardship before 65. The MPF early withdrawal proposal targets exactly these cases, with a possible 50% cap.

What does the proposal cover?

Serious illness qualifies; cap at no more than half. Wu said the authority is also open to other compassionate grounds, such as funding a property down payment or children’s university fees. A ceiling on amounts and a limit on withdrawal frequency are planned; her personal view is the cap should not exceed 50% of a member’s total accrued MPF benefits.

What worries the industry?

Fears for retirement life and the system’s founding purpose. Gloria Siu, director and general manager at Gain Miles, backed the “sympathy mechanism” — seriously ill members drawing money for treatment makes sense — but worried early withdrawal could hurt members’ future retirement, saying the authority faces many difficulties and much discussion before implementation. Kenrick Chung, director of MPF business development at Convoy Financial Services, said early withdrawal may violate the initial objectives of the city’s retirement system, urging cautious criteria for who qualifies. Bank Consortium Trust managing director and CEO Ka Shi Lau said early withdrawal may not bring significant impact — though the original report breaks off there, leaving his full view unrecorded.

To learn the current early-withdrawal rules, visit MPF fund comparison.