A Choice On Macao's Pension Scheme In View Of Hong Kong's

It is true that aging is a problem of Macao. As the Mandatory Provident Fund of Hong Kong has been carried out into effect, there is an urgent need that Macao residents should choose a suitable pension scheme for themselves. However, it is not time for Macao to imitate Hong Kong in adopting MPF since the financial market of Macao lacks of maturity and the salary is relatively low. Besides the MPF system, Central Provident Fund system and Pay-As-You-Go system are also commonly adopted by most of the countries in the world. However, the former defect is that the government replaces market operation, resulting in lack of competition. The latter is a system of which pension fund is paid from taxes. Owing to the aging problem and the stability of wages in Macao, the adoption of Pay-As-You-Go system will be unfavorable to economic growth.In summarizing the mentioned points, I think the most suitable pension scheme for Macao to adopt at present is a non-compulsory system with a privilege on tax rate provided by the government, together with the support given by the Social Security Fund and the Social Work Department as the last safety network. The advantages are that it can lighten the financial responsibility of the government and create the retirement investment financial market of Macao. For that reason, the supervision of the financial market should be made perfected. On the other hand, the Macao Monetary Authority should strictly examine and give approval to all those financial retirement products. And she also has the duty to provide suitable instruction for the investment of funds to the relative employers and employees. Besides, in order to attract more large enterprises to choose the retirement funds approved by the Macao Monetary Authority, the government should enlarge the privilege on the reduction of tax rate, so as to enable different kinds of enterprises to join in the private pensionscheme. Moreover, the Social Security System of Macao should be made perfectible by the Macao government, so as to ensure those employees who have not joined in the pension scheme a reasonable retirement benefit. Lastly, the Macao Monetary Authority should set up a solid and safe investment regulation to enable the value of the pension fund be maintained and risen, so that the retirement lives of the residents can be secured.