Unionists say annuity plan unsuited for low-income workers

Local | 3 Aug 2018 7:10 pm

Critics of a new public annuity scheme say low-income people do not stand to benefit because they prefer greater flexibility with their money.

The public annuity scheme offers subscribers a life-long, guaranteed monthly payment after they invest a lump sum, RTHK reports.

But participants must be a permanent resident of Hong Kong, and it would take at least 15 years for the money to break even.

The Confederation of Trade Unions conducted a poll last month, asking more than 100 grassroots workers how they feel about the scheme.

They said 80 percent of the respondents will not invest in the plan.

Half of those who are not interested, said they do not want to lock up their savings in the scheme.

Another 20 percent said they think there are better investment options out there that can generate higher returns, such as blue-chip stocks.

"Every dollar to these workers are very important. They want to keep their money, their savings inside their pockets so that they can control it … so that when they have some incidents, such as medical consultation, they will have enough money or enough savings to solve this problem”, the confederation’s Patrick Ng said.

Ng said most respondents would rather see a universal pension scheme for retirement protection.-Photo: RTHK

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