MPF default contributions crackdown: ignoring a court order to pay arrears becomes an offence, with daily fines for persistent defaulters

The Mandatory Provident Fund Schemes (Amendment) (No. 2) Bill 2011, gazetted on 9 December 2011, was the other half of that year’s MPF regulatory overhaul. Beyond the intermediary registration regime for the Employee Choice Arrangement, it aimed enforcement squarely at employers who default on contributions: ignoring a court order to pay up would become an offence, and persistent defaulters faced daily fines.

How did the 2011 amendment strengthen enforcement against MPF default contributions?

The bill gazetted on 9 December 2011 made it an offence for an employer to ignore a court order to pay MPF default contributions and surcharges, and allowed daily fines against employers who persistently failed to make mandatory contributions — tightening the enforcement net around MPF default contributions.

Two enforcement pillars

• Ignoring a court order becomes an offence: an employer ordered by a court to pay arrears who still failed to do so would break the law.
• Daily fines for persistent default: employers who continuously failed to contribute for their employees faced fines accruing by the day — the longer the default, the heavier the penalty.

Notably, the proposed model built on the administrative arrangements the MPFA had used since the MPF system’s launch in 2000, refined to use regulatory resources efficiently. The bill also introduced criminal sanctions banning unregistered intermediaries from selling or promoting MPF products, paving the way for the Employee Choice Arrangement on 1 November 2012.