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Friday, September 30, 2016, 00:49

CE vows to resolve MPF offsetting issue

By Luis Liu

HONG KONG - Chief Executive Leung Chun-ying vowed to resolve the Mandatory Provident Fund (MPF) offsetting issue within his remaining time in office, the city’s biggest labor group said on Thursday after meeting with the CE.

It is the first time the CE has given a timeline for resolving the issue.

In a closed-door meeting, the Hong Kong Federation of Trade Unions (FTU) and Leung discussed the possibilities of ending the controversy over the offsetting mechanism, under which employers can settle severance and long-service payments with employees’ MPF savings.

Federation President Lam Shuk-yee said the government had not worked out a plan for resolving the problem. As Leung made this pledge, Lam expressed confidence in the issue being settled.

Over the past 15 years, some HK$29.2 billion were used to pay for employees’ severance and long-service payments, shrinking people’s savings for retirement, Lam said, citing MPF Schemes Authority (MPFA) statistics. She urged the government to take this seriously.

Leung has also pledged to continue communicating with the FTU over the issue, according to Lam. She said the FTU will discuss details with the government soon.

A solution to the issue was highlighted in Leung’s political platform. In his election manifesto 2012, Leung pledged to “progressively reduce” the proportion of the employer’s contributions to the MPF that can be used for offsetting.

FTU member and outgoing legislator Bill Tang Ka-piu said it is time for Leung to honor his promise as a new-term Legislative Council will soon begin. He urged the government to work out a concrete plan soon.

However, the possibility of a swift settlement was questioned by other key relevant officials. MPFA Non-executive Director Poon Siu-ping said he doubted whether the government could work out a concrete solution as it had only nine months left. He hoped the government could lower the offsetting rate progressively.

Chief Secretary for Administration Carrie Lam Cheng Yuet-ngor said she will focus more on the issue.

However, the issue is complicated, she admitted. More importantly, amending the law requires approval from LegCo, in which there are diverse opinions among lawmakers.

Thus, she felt it was more feasible for the government to give a clear direction by the end of the term. It could then leave the legislative work to the next administration.

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