Editorial | Global recognition of Hong Kong’s pension scheme should spur more upgrades
The MPF has, over the years, widened its coverage of residents’ retirement needs and become more credible, but there is still much room for improvement
That is the largest improvement among all Asian pension schemes, taking it behind Singapore (80.8) and Australia (77.6) in the Asia-Pacific region. Any score above 80 has an A grade. Mainland China has earned a C, having scored 56.7 while India is at the very bottom of 52 systems rated in the index, with a D at 43.8 points.
The latest score puts Hong Kong slightly ahead of Belgium, Canada, France and New Zealand. But all top three spots are taken by Europeans, led by the Netherlands, followed by Iceland and Denmark.
The United States has a C+, at 61.1, while Britain – with a B grade of 72.2 – is ahead of Hong Kong.
The index, now in its 17th year, grades with A, B+, B, C+, C, D and E, though no pension scheme was given the lowest grade. The pensions are measured by how well they cover people’s retirement needs (adequacy), deliver benefits over time (sustainability), and whether they are trustworthy (integrity).
Hong Kong’s MPF scored 89.2 points for integrity, well above the global average of 75.4 and is behind only Finland at 90.6 and Singapore at 90.4. When it was first included in 2018, the city scored only a C, with 56 points on the index. The biggest improvement has been in adequacy, which climbed to 66.6 points this year from 39.4 points in 2018.