Hong Kong’s MPF ranks second among Asia’s pension systems, behind Singapore’s CPF, as adequacy, sustainability scores rise
- The city’s compulsory retirement scheme scored 64.7 out of 100, behind Singapore’s 74.1, in a ranking by consulting firm Mercer
- Hong Kong’s government tax incentives in 2020 helped improve the MPF’s adequacy sub-index score
The city’s HK$965 billion (US$123 billion) compulsory retirement scheme scored 64.7 points out of a possible 100 in the annual Mercer CFA Institute’s Global Pension Index, an increase from 61.8 in 2021. Singapore’s provident fund improved its score to 74.1 from 70.7, while third-ranked Malaysia’s pension fund collected 63.1 versus 59.6 in 2021.
Iceland, Netherlands and Denmark topped the list of 44 global pension systems in this year’s ranking, repeating the top three from 2021, according to the report published by the consultancy on Tuesday.
“Hong Kong has come a long way from a much lower adequacy score in 2018 to a much higher level now,” said Janet Li, Asia wealth leader in Hong Kong at Mercer. There is still room for improvement, she said, pointing to the low minimum contribution level in the city versus other schemes in the region.
The Global Pension Index, the 14th in the series, uses adequacy, sustainability and integrity sub-indices to measure each retirement income system against more than 50 indicators, according to Mercer. The weightings used are 40 per cent, 35 per cent and 25 per cent, respectively.
