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2017/01/18
Pragmatic Policy Address, Save for MPF Offsetting Proposal
   

For Immediate Release

HKGCC appreciates the Chief Executive's efforts to present a carefully thought-out blueprint for Hong Kong in his final Policy Address. We believe the proposals will help steer Hong Kong forward during what promises to be a challenging year for the economy.

A key issue that will have far-reaching consequences for Hong Kong is our aging population. We welcome efforts to address the challenges that a greying population will create and the seriousness of which the Government is looking at the issue.
 
The proposed eMPF, a centralized electronic platform, is a welcome development and long overdue. It will go a long way to improve efficiency and reduce the current excessive costs.
 
However, "The abolition of the MPF offsetting mechanism is entirely unfair to employers, who are required to pre-fund the long service payment (or severance payment) through the MPF and are then told they cannot use it when they need to do so. It creates an unfair double liability for employers, despite the long transition period.  It will also impose heavy financial burden on businesses, especially SMEs and business start-ups," Chamber Chairman Stephen Ng stressed.  "In addition, it is unfairly simply shifting the burden of retirement protection to employers. The MPF offsetting is only one part of retirement protection, which needs to be dealt with in a holistic approach, not the current piecemeal manner.  Despite the proposed subsidies, employers will have to pay twice for employees' retirement protection."
 
In anticipation of Hong Kong's working population peaking in 2018, the Government needs to urgently start rolling out pre-emptive measures to deal with the double blow that a shrinking workforce and ageing population will create. These must include attracting more overseas talent, and nurturing local talent.
 
"Businesses have been burdened by persistent labour shortages for many years. On top of that, they have been hit by a series of proposals on labour-related regulations, including retirement protection, standard working hours and the abolition of the MPF offsetting mechanism. These liabilities are being imposed on businesses piecemeal and without any assessment of their overall costs and benefits, nor without any consideration of the heavy burden that all these will have on SMEs, who are the backbone of our economy," added Ng.
 
On tackling the vexing land and housing issue, the Chamber applauds the Chief Executive's efforts to boost the availability of land and housing. This has been one of CY Leung's priorities during his tenure, and we appreciate his dedication and initiatives that have seen progress during his term.
 
A key focus for any economy in the 21st Century is harnessing innovation and technology.  Hong Kong is no exception.  It is encouraging that the Government is looking at putting more emphasis on harnessing of fintech and smart-city technologies. The plan to develop a Hong Kong-Shenzhen Innovation and Technology Park at the Lok Ma Chau Loop will be a major step forward. However, Hong Kong needs to speed up initiatives and policies to drive the development of innovation and technology forward more quickly as many of our competitors are racing ahead of us.
 
Two other areas that we need to be looking at expediting are facilities and support for capitalizing on opportunities under the Belt & Road initiative, as well as increasing the capacity of our limited exhibition and convention facilities.
 
Overall the Chamber commends the Government for taking on board many of the Chamber's proposals, which will strengthen Hong Kong's competitiveness. We look forward to working with CY Leung's Administration for the remainder of his term and also his successor to achieve the common objectives of a prosperous and stable Hong Kong. 
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Media inquiries: Please contact Ms Milly Lo at 2823-1248 / [email protected]
 
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