97.         Regarding retirement protection, I suggest in my Manifesto that we should study the impact of an ageing population on our public finance, and plan ahead to deal with the issue in a timely manner. The Government will reinforce and enhance the existing three pillars, namely, private savings and family support, the social security system, and the Mandatory Provident Fund (MPF) System. The Old Age Living Allowance (OALA), to be launched in April 2013, will be an additional tier of financial assistance between the CSSA and the Old Age Allowance (OAA). Some have proposed that the Government should review the relationship between the three types of financial assistance for the elderly, namely the CSSA, OALA and OAA. We are also aware of views in favour of the introduction of universal retirement protection. But there are concerns that universal retirement protection would impose a very heavy burden on the public coffers over time, and would be impractical without tax hikes. The other option based on tripartite contribution from employers, employees and the Government is equally controversial, involving issues such as affordability and sustainability. The Social Security and Retirement Protection Task Force will study retirement protection in depth in an open, pragmatic and prudent manner. It will consider all views objectively and work towards a consensus in the community on how we should take forward retirement protection in Hong Kong.

98.         The MPF System has a history of 12 years and is in need of continual refinement. Many people have grave concerns over some arrangements of the MPF System, in particular its fee levels. We will work with the Mandatory Provident Fund Schemes Authority so that a multi-pronged approach can be adopted to bring down fees and charges.

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