MPF | South China Morning Post
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  • Jan 28, 2015
  • Updated: 9:12pm

MPF

The Mandatory Provident Fund (MPF) is a compulsory pension fund designed by the Hong Kong government as a major protection scheme for the aged and retired residents.  Most employees and their employers are required to contribute monthly. 

Haitong's lower fees a small step in right direction for retirement fund

Lin Yong, CEO of Haitong International. Haitong announced to waive MPF investment management fees for three years. Photo: Bloomberg

Among the many flaws of the Mandatory Provident Fund that critics have pointed out, the one that is the most detrimental to retirement savings is the high fees and charges that funds levy on customers. At the current market average of 1.71 per cent, such charges amount to an astronomical cost over the course of a working life. 

Wednesday, 12 February, 2014, 7:30am

'Zero fees' pledge to spark MPF price war

Protestors voice their discontent over the Mandatory Provident Fund Schemes as Chief Executive Leung Chun-ying gives his second policy address at Legislative Council. Photo: Sam Tsang

A price war is looming among Mandatory Provident Fund providers after Haitong International became the first fund house to waive investment management fees.

The company has announced it will waive the charges for the next three years. Employees will still have to pay trustee and administrative fees, but they will be reduced.

11 Feb 2014 - 1:28am 2 comments

MPF loses money in January with forecasts for tough year ahead

MPF reported an average loss of 2.43 per cent last month, but still managed to beat the Hang Seng Index, which fell 5.45 per cent during the month.

The city's Mandatory Provident Fund reported an average loss of 2.43 per cent last month on sliding regional stocks and currencies, according to data provider Lipper.

6 Feb 2014 - 9:37am

Hong Kong lawmakers urge financial reforms must move faster

Chan Ka-keung says the government does not yet have any plans to help local firms develop in the mainland. Photo: Sam Tsang

Lawmakers want the government to speed up its numerous financial reform plans and to go further in helping local financial professionals enter the many planned free-trade zones in the mainland.

30 Jan 2014 - 5:01am

Bosses must stop dipping into workers' retirement funds

The government and the Mandatory Provident Fund Schemes Authority should start placing limits on how much bosses can take out of an employee's account.

Everyone knows about the Mandatory Provident Fund's shortcomings, yet no one seems to have a clear idea how to reform it. Among its most glaring flaws, at least if you are an employee and not a boss, is the so-called offsetting mechanism.

25 Jan 2014 - 4:10am 1 comment

MPF's real swindle is way it is stacked against workers

Illustration: Emilio Rivera

Speculation that Chief Executive Leung Chun-ying was planning to abolish the much criticised offsetting mechanism in the Mandatory Provident Fund was a "misunderstanding," the city's leader said ...

 

SCMP, January 18

21 Jan 2014 - 12:33am 2 comments

MPF doesn't work for the little guy

Hong Kong is probably the only developed economy that allows employers to legally raid such pension accounts to  "offset" a worker's severance and long-service payments. Photo: AFP

A fund manager friend calls it the Mandatory Poverty Fund. Most of us call the MPF by its more polite name. But my friend has a point. The way the quasi-pension fund is run now, you are guaranteed a life of penury if you have to live on it after retirement.

18 Jan 2014 - 12:36am 5 comments

Interest grows in MPF yuan funds

Employees have many categories of funds to choose from under the MPF; yuan funds are still a tiny minority. SCMP graphic: Mario Rivers

Yuan-based MPF funds are catching on among Hongkongers even as they underperform other categories.

19 Nov 2013 - 2:57am

MPF continues strong run but outlook tempered by market uncertainties

How the funds performed

Investment funds in the Mandatory Provident Fund scheme, which covers 2.4 million employees in the city, continued its good run last month, beating the Hang Seng Index.

6 Nov 2013 - 5:33am

MPF dips into the red for first half

MPF reported a 0.56 per cent loss in the first half of the year. Photo: AP

The Mandatory Provident Fund, the retirement scheme that covers 2.4 million people in Hong Kong, reported a 0.56 per cent loss in the first half of the year, worse than putting money in the bank but beating the stock market's benchmark Hang Seng Index, which fell 8 per cent.

4 Jul 2013 - 5:23am 1 comment

Ongoing challenges faced by the MPF

Ongoing challenges faced by the MPF

The Mandatory Provident Fund was launched in 2000 to address, in part, the challenge of financing the retirement of a quickly ageing population. Its net assets had reached HK$455 billion at the end of March and the annualised rate of return over the past 12 years has been 4 per cent.

3 Jul 2013 - 4:52am 3 comments

MPF switch fails to make big hit

Just 64,000 have opted to move to a new MPF provider.

While the move to allow switching of MPF funds was hailed as the scheme's most significant reform since its launch in 2000, only 64,000 employees have opted to do so since being granted that choice on November 1 last year.

13 Jun 2013 - 6:20am 1 comment

Low-fee funds not high on pensions list

Low-fee funds not high on pensions list

Everyone likes a bargain. And if we extend this truism to the thorny issue of fees for our retirement schemes, then perhaps we should be thankful that our pension regulator is trying to bring in rules to lower MPF fees. But a closer look shows caution is required.

11 Jun 2013 - 3:25am 1 comment

Market sell-down leaves MPF funds in the red

Market sell-down leaves MPF funds in the red

The Mandatory Provident Fund, which covers the city's 2.5 million employees, sank back into the red last month as Japanese and emerging-market stocks fell.

The 458 investment funds under the retirement scheme reported an average month-on-month loss of 0.87 per cent after a gain of 1.9 per cent in April, according to data provider Lipper.

5 Jun 2013 - 4:05am

MPF back in profit as markets rally

MPF retirement funds reported average profits of 1.9 per cent in April, following on from losses in both February and March. Photo: K. Y. Cheng

The Mandatory Provident Fund, covering 2.5 million employees in the city, returned to profit in April after recording two consecutive months of losses. Analysts attributed it to the recent worldwide stock market rally and predicted retirement funds would deliver stable returns in the coming months as many countries around the globe adopt loose monetary policies to boost their economies.

4 May 2013 - 4:53am