Hong Kongers fleeing China’s crackdown denied pension savings

Kuala Lumpur, Malaysia – When Ivan Chan moved to the UK with his wife and two children in 2021 to escape China’s crackdown on Hong Kong, he knew he would have to leave nearly $90,000 in retirement savings.

Under the rules of Hong Kong’s mandatory pension scheme, Chan, 40, would normally be entitled to early withdrawal of his savings as someone who has permanently left the city.

Instead, Chan has been barred from retirement because authorities in the former British colony refuse to recognize the British National (Overseas) – or BNO – passport he used to emigrate as a valid ID.

“If we couldn’t get that money, it would be difficult for our financial planning,” Chan, a former civil servant who now works at a supermarket in London, told Al Jazeera.

“Of course our retirement life will change.”

“They don’t like people leaving Hong Kong and they will do everything they can to punish them,” Chan said.

Chan’s case is not unique.

Hong Kong Watch, a UK-based activist group, estimated last month that Hong Kongers in the UK had been denied access to more than $2.8 billion in retirement savings.

More than 144,000 Hong Kongers have moved to the UK since it began offering work and residence rights to BNO passport holders in response to Beijing’s imposition of a sweeping national security law on Hong Kong in 2020 following massive pro-democracy protests that turned violent.

Under the law, Hong Kong’s rights and freedoms, which once distinguished the territory from mainland China, have declined dramatically despite a “one country, two systems” arrangement that was supposed to guarantee the city’s way of life for at least 50 years after the transfer of British rule.

Hong Kong authorities have effectively wiped out all political opposition by arresting or disqualifying most of the city’s pro-democracy legislators, shutting down critical media outlets and virtually banning criticism of the Chinese Communist Party (CCP). Officials in Beijing and Hong Kong have praised the legislation to restore peace and stability to the Asian financial center.

After the UK announced its visa plan, China said it would no longer recognize BNO passports, accusing London of interfering in its internal affairs.

Since the Beijing announcement, Hong Kong’s Mandatory Provident Fund (MPF) Authority, which regulates the pension scheme, has instructed savings management banks not to accept the use of BNO passports for early retirement requests.

While authorities have denied any political motive for the pension rule changes, affected Hong Kongers have no doubt they will be punished for defying the CCP.

“I think this is some kind of punishment and they treat the Hong Kong-born people as slaves,” a 47-year-old Hong Kong emigrant who fled the city in 2021 told Al Jazeera, asking to remain anonymous.

He said he has been denied access to about $100,000 in retirement savings.

“It just made my transition that much harder. Of course it’s an extra burden for me,” he said.

Under current rules, Hong Kongers who are currently unable to access their pension should be able to do so when they reach retirement age or obtain a new passport through UK citizenship.

But some Hong Kongers fear the Chinese government will just change the rules again to make sure they can’t get what they rightfully have.

“I have no hope of getting it from the Hong Kong government or the Chinese government,” said the Hong Kong émigré, who asked to remain anonymous.

“It’s literally gone,” he said.

The situation has also prompted scrutiny into the role of the banks that manage Hong Kongers’ pensions, including London-based HSBC.

Sam Goodman, director of policy and advocacy at Hong Kong Watch, said HSBC was complicit in a “brutal possession of assets” by Beijing designed to warn Hong Kongers against leaving.

“HSBC is failing to fulfill its responsibilities as a trustee of the Mandatory Provident Fund,” Goodman told Al Jazeera.

“It must explain to its customers why it is blocking access to their hard-earned savings and ask the UK government why a bank headquartered in London is carrying out the order of an authoritarian government by not recognizing a valid government-issued document.”

A spokesman for HSBC said the bank is required to follow the law and instructions from the regulator in all jurisdictions in which it operates.

“In the event of permanent departure, scheme participants are required to provide proof of right of abode outside Hong Kong,” the spokesman said. “The regulator has publicly confirmed that a BN(O) passport cannot be used as such evidence.”

A spokesman for Manulife, which also manages MPF funds, said the bank follows industry practices and regulatory requirements.

Other banks that manage MPF funds, including Standard Chartered, China Life and ING, did not respond to requests for comment.

A spokesman for the Mandatory Provident Fund Authority rejected suggestions that Hongkongers were being punished for moving to the UK.

“MPF Program members who have moved abroad are not prohibited from withdrawing their MPF as long as the withdrawal criteria are met, and we strongly condemn the false accusation that Hong Kong residents are being penalized for emigration the spokesperson told Al Jazeera.

“Such an [a] unfounded claim is not only misleading, but also undermines the credibility of the MPF system.”

For Hong Kongers like Chan, such statements ring hollow.

Chan, who said his children’s education was the biggest factor behind the decision to emigrate, plans to apply to have his pension withdrawn when he acquires British citizenship, although he is not optimistic that he will ever will get his money.

“The money is ours,” he said. “Let’s manage our money freely.”