The Mandatory Provident Fund Schemes Authority (MPFA) has voiced its strong endorsement of Chief Executive John Lee's announcement of the city's first five-year development plan and the new Policy Address delivered today, which outlines the blueprint for Hong Kong's economic and social progress over the next five years alongside key government priorities for the coming year. Within this framework, several measures are dedicated to enhancing the MPF system and bolstering retirement protection for scheme members.
MPFA Chairperson Alice Lau Mak Kai-yuen noted that the government's five-year plan aligns closely with the policy direction of the nation's 15th Five-Year Plan, providing a clear roadmap for Hong Kong's future development while fostering deeper integration into the national development strategy and reinforcing the city's status as an international financial center.
Ms. Lau stated, "The MPFA will fully coordinate with these initiatives and collaborate with the government and industry stakeholders to drive the implementation of reforms, continuously elevating the efficiency and adequacy of the MPF system to secure better retirement benefits for scheme members. Having already finalized our own five-year strategic direction, we will integrate the spirit and priorities of this inaugural plan into our forward-looking agenda."
She further highlighted that the measures unveiled in the Policy Address demonstrate the government's commitment to deepening reforms, enhancing financial market competitiveness, and strengthening retirement security for citizens, which will help modernize the MPF system, improve its operational efficiency, and expand investment options, ultimately delivering greater value to contributors.
In response to the Policy Address's proposal to complete a review of the regulatory framework for index-tracking collective investment schemes (ITCIS) under the MPF system by the end of 2026, consult stakeholders on optimization suggestions, and remove the aggregate investment cap on MPF funds investing in qualifying index-tracking exchange-traded funds (ETFs), Ms. Lau expressed her support.
Ms. Lau remarked that the MPFA will examine legislative proposals to refine the ITCIS regulatory framework, aiming to introduce a broader range of index-tracking MPF funds for member selection. Additionally, the authority plans to ease restrictions on MPF funds investing in qualifying index-tracking ETFs, eliminating corresponding total investment limits to enhance the flexibility of utilizing high-quality local ETFs for asset allocation and promote portfolio diversification. These measures are expected to optimize the investment scope of the MPF system, enabling members to benefit from a wider array of cost-effective investment options.
She added, "The MPFA is fully dedicated to advancing MPF reform, with the first phase of the 'full portability' initiative set to roll out this year, allowing employees who joined on or after May 1, 2025, to manage their MPF investments with greater flexibility. Concurrently, we are actively supporting the government's preparations for legislative proposals to implement the second phase of 'full portability' for all other employees, further stimulating market competition and prompting trustees to continually enhance service quality, thereby securing improved retirement outcomes for members."
With respect to the Policy Address's mention of streamlining procedures for recovering overdue MPF contributions, increasing flexibility for trustees and related service providers in the investment and management of MPF funds, and extending the Hong Kong Monetary Authority's 'Generative AI Sandbox++' application scenarios and participation scope to financial domains such as the MPF, the MPFA will continue to uphold a member-first approach and fully cooperate with government efforts in these areas.