To strengthen the youth’s understanding about the SAR Government’s social security policy and listen to their views about the social security system, the Social Security Fund (abbreviated to FSS in Macao) and the Education and Youth Affairs Bureau jointly hosted a dialogue last night (27th March) on the theme “Plan Early for a Carefree Retirement" between the FSS Chief and the youth.  Iong Kong Io, President of the Administrative Committee of the FSS, answered online questions and exchanged views with about 80 young people at the scene, and the atmosphere was welcoming.

The event was held at 7 p.m. at Confucius Conference Hall on the first floor of the Education and Youth Affairs Bureau headquarters and was broadcast live on the internet.  Iong first introduced the Government’s social security policy to the youth at the scene and those watching the live webcast.  He pointed out that with the development of society, Macao faces the same problem of population ageing as most countries or regions in the world.  It is expected that the population aged 65 and older will account for about 14.2% of the local population by 2020.  The two-tier social security system is an important part of the SAR Government’s pension security policy.  The first-tier social security system provides basic pension security for residents by collecting fixed contributions and granting fixed payments.  The second-tier non-mandatory central provident fund system allows employees and employers or individuals to participate in the provident fund contribution schemes for the purposes of savings and investment, and the accumulated wealth provides further protection for their retirement.

He also reminded young people that financial planning should be done as soon as possible and they should make good use of the benefits of youth.  For example, investment involves principal, time and rate of return.  The changes in these three elements have important implications for the effectiveness of investment, and among them, time is relatively easier to control.  As long as the time is sufficient, even if the principal is low and the rate of return is low too, the ideal saving goal can be achieved easily.

In the response and exchange session, the issues that are more concerned by young people are mainly the non-mandatory central provident fund system that came into force this year, such as the ways of participating in the system, how to choose the suitable pension fund products, investment strategies, and the management of individual accounts, etc.  For example, one youth asked Iong what are the benefits of the non-mandatory central provident fund system when there are also many pension products in the market.  Iong responded by saying that the System has a joint provident fund scheme and an individual provident fund scheme.  The former has vesting percentages, for which the employee will start to be entitled to part of the employer’s contribution balance after three years of contributions, and all of the employer’s contribution balance after ten years of contributions.  Besides, the related funds cannot be used as a deduction for dismissal compensation.  Regardless of whether a person participates in a joint or an individual provident fund scheme, the account owner can apply for the transfer of funds allocated by the government to make investment together, which will also help strengthen retirement protection.

In response to one youth’s concern about whether a non-permanent resident can participate in the non-mandatory central provident fund system, and if the renewal of the identity documents is not granted, will it affect his or her rights and interests, Iong said that any Macao SAR resident who has reached 18 years of age, or who is under 18 and has already enrolled in the social security system can also participate.  Of course, the non-permanent residents are also included.  If a person whose account has been cancelled because the renewal of his or her identity documents has not been granted, he or she may apply for fund withdrawal on humanitarian grounds.

A youth agency representative was also concerned about how residents can obtain investment-related information for making appropriate investment decisions.  Iong pointed out that there are currently a total of seven fund management entities offering 39 pension fund products.  Since each individual’s risk tolerance is not the same, the investment strategy and risk level of each pension fund is also different.  Residents can browse the non-mandatory central provident fund system information platform, and compare the various pension funds one by one.

At the event, Iong repeatedly advised that young people should set financial goals early to make good use of government resources, for example, to develop savings habits, learn investment and financial management by participating in the contribution schemes of the non-mandatory central provident fund system, and to adjust investment strategies at different stages of their lives to make early plans for future retirement.

Members of the public can visit the website of the Education and Youth Affairs Bureau’s website at www.dsej.gov.mo to review the contents of the event in order to learn more about the social security rights and obligations that are closely related to young people, and how to plan for their retirement.  For more information about the two-tiered social security system, please visit the website of the FSS at www.fss.gov.mo or call 2853 2850 for enquiries.