Three in every 10 employees in Hong Kong could find themselves without pension cover when the Mandatory Provident Fund (MPF) is launched on December 1, and most of those workers are self-employed. Mandatory Provident Fund Schemes Authority (MPFA) managing director Rafael Hui Si-yan said some smaller employers were still not aware that it was their legal obligation to set up an MPF plan. He expected that by the launch date on December 1, 30 per cent of employers - mostly smaller employers and self-employed workers - would still not have signed up to the MPF. Hong Kong has about 300,000 self-employed workers, including taxi and mini-bus drivers, teachers and construction workers. Many of these workers are able to avoid taxation by frequently changing employment and a lack of information about them would make it difficult to capture them in the MPF network, Mr Hui said. In other countries that had introduced compulsory retirement saving schemes, such as Chile, only about 10 per cent of self-employed people had joined a pension plan, Mr Hui said. Mr Hui said the MPFA was setting up a 60-member inspection team to catch non-compliers. He said employers who failed to set up an MPF plan would face a maximum penalty of six months in jail and a fine of HK$100,000. The MPF regulations require Hong Kong's 300,000 local companies, which employ more than 2.2 million people, to set up pension schemes before the December 1 deadline. So far only 62,000 companies, have signed up with an MPF provider. That is only 20 per cent of the total number of Hong Kong companies obliged to sign up. Mr Hui, however, said he was not surprised by the level of compliance in Hong Kong. 'If, however, we could get 70 per cent compliance at the first launch of the MPF, it would have been higher than any overseas market,' he said. In Chile and some other South American countries, the compliance rate at the first stage of a compulsory retirement plan was only 50 per cent. The slow rate at which companies are signing up for MPF has prompted concern from Financial Secretary Donald Tsang Yam-kuen, who reminded companies of their obligations and said the deadline date would not be delayed.