Introducing MPF voluntarily would be an appropriate way of getting the scheme up and running amid the current economic gloom, according to Greg Willis, chief executive of HSBC Provident Fund Services. Mr Willis said a voluntary start-up would avoid the need to rope in thousands of reluctant small companies during a time of economic hardship and would provide a valuable running-in period for systems and staff. 'As an interim measure, it could be started on a voluntary basis,' he said. 'Apart from anything else, it would allow employers who want to set up retirement schemes to do so [many have stalled the introduction of new schemes because of a need to comply with MPF] and the MPF industry could tick over until such time as the Government declares, 'Now we will make it compulsory'.' One of the biggest challenges facing the MPF is compliance. An estimated 2.4 million Hong Kong workers are not covered by any retirement scheme and some are already facing cuts in wages or commissions as a result of the economic downturn. More than 300,000 individual employers - mostly small to medium-sized companies - and an army of self-employed add up to a logistical nightmare for administrators. Mr Willis said: 'The logistics of getting all those people enrolled into retirement schemes over a 12-month period are enormous. It is frightening. 'The Government itself is planning for a 60 per cent compliance rate in the first year. So, if you start it on a voluntary basis, it would ease a lot of those problems.' He said starting mandatory contributions to MPF in a gloomy Hong Kong economy would add to the financial pressure on companies and redirect income away from the already-struggling retail sector. 'There never will be a right time to start MPF but you want to do it at a time people are not going to try to avoid compliance because of a real deleterious affect that it has on their financial well- being,' Mr Willis said. On a voluntary basis, MPF could be up and running some time next year, he said, once the MPF Authority and all its systems were in place. Hong Kong could have a voluntary 'mandatory' provident fund without a complex legal overhaul, according to Mr Willis. 'The law would need to be amended, but only relatively slightly. It is even arguable, from a legal perspective, that you could declare anyone who does not voluntarily set up an MPF scheme is an exempted person under the terms of the legislation,' he said. 'The Government could do that by its own decree without even having to go back to the legislature. 'I don't know in this climate how many employers would join a voluntary scheme but at least it is worth a shot. It at least gets things started up. It will help people ease through some of the transitional problems.' Mr Willis said it would be far better for the Government to be sorting out its own internal transitional problems with a small number of schemes. In the absence of a firm start-up date for MPF, HSBC Provident has decided to wind down its MPF operation. 'We will leave a skeleton crew on board and we will resurrect the operation when it looks likely to get the go-ahead,' he said.