Editorial : Abolition of MPF offsetting scheme

【明報專訊】THE policy address will be unveiled next week, which is expected to include a new scheme for the abolition of the Mandatory Provident Fund (MPF) offsetting mechanism. The government is set to extend the subsidisation period for employers from 12 years to 25 years, with the amount of subsidisation boosted from $17.2 billion to around $30 billion. Given the fact that the new scheme will come into effect in 2022 at the earliest, the government will in effect be subsidising the business sector until 2047.

Hong Kong's GDP per capita exceeds US$46,000, which is higher than that of many advanced countries. But its social security is seriously lacking and the protection of labour rights is not up to par. Employees reap economic rewards that are not directly proportionate to their sweat and toil. The MPF offsetting mechanism is, in particular, detrimental to the labour rights of the people from lower social strata. The MPF scheme came into effect in December 2000. Back then the government, striving for the support of the business sector, agreed to the establishment of the offsetting mechanism. The mechanism allows employers to make severance payment and long service payment by drawing on the MPF account of an employee.

According to the new plan, the government will lengthen the period of subsidisation from 12 years to 25 years, and the amount of subsidisation will almost double to $30 billion. But employers remain non-committal, saying that "it is too early to say whether we can accept that", at the same time expressing the hope that the formula of the plan can be "further simplified". As the devil lies in the details, it deserves close observation whether the plan will be riddled with loopholes. The plan will come into effect in 2022 at the earliest, meaning that the period of subsidisation will end only in 2047. It is ridiculous and ironic that an arrangement that allows employers to shirk social responsibilities can "remain unchanged for 50 years", evolving all the way from 2000 and set to continue through to the middle of this century. What is even more worrying is that some people in the business sector, exploiting the government's willingness to foot the bill, might relish the experience so much that they will stick to their guns over every issue and demand that the government foot the bill. It will be extremely difficult to reverse such a trend after a precedent is set.

Some people in Hong Kong's business sector have often cited excuses such as "the harmful effects on the business environment" and "the stifling of the room for small- and medium-sized enterprises to survive" to oppose some very fundamental measures that protect labour rights such as the minimum wage, the abolition of the MPF offsetting mechanism, the implementation of standard working hours, the standardisation of labour holidays and the extension of maternity leave to meet international standards. However, the point is that the quality of a business environment is not directly related to the level of social welfare. Denmark has one of the highest levels of social welfare in Europe. According to the 2018 Doing Business report by the World Bank, Denmark's business environment is ranked third in the world, which is higher than Hong Kong (ranked fifth). If some people in the business sector find it hard to stomach the improvement of some basic labour rights, it will inevitably lead to doubts whether they can only achieve competitiveness by exploiting their employees. It deserves consideration whether such companies have any future to speak of.

明報社評2018.10.05:取消對冲補貼期漫長 商界卸膊「50年不變」






non-committal : not giving an opinion; not showing which side of an argument you agree with

be riddled with sth : to be full of sth, especially sth bad or unpleasant

stomach : to approve of sth and be able to enjoy it; to enjoy being with a person

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