MPF Semi-Portability Launches: John Tsang Urges Patience, MPFA Urges Risk Awareness

This article is a rewrite of a report from November 2012.

In November 2012, the long-prepared MPF “semi-portability” formally began: 2.35 million workers gained a yearly chance to move their accounts’ accrued MPF benefits to a favoured trustee. Financial Services Secretary John Tsang advised citizens not to rush switching; MPFA operations chief Rosaline Lo also urged calm — switching is a right, not a duty.

What is good about the Employee Choice Arrangement?

One more choice, more competition, pressure on fees. Tsang said the new arrangement would boost market competition and cut fees; he saw ample room for further fee cuts and would follow up with the MPFA, hoping for greater fee transparency.

What should you consider before switching?

Your risk tolerance — not market timing. Lo advised employees to analyse personal needs: nearing retirement age? Satisfied with the trustee? Don’t chase market swings hoping to time a switch or follow the herd; weigh risks and your own capacity clearly. Citizens could consult the MPFA’s online fee-and-service comparison platform for homework.

What did citizens think?

Some wanted to move, others to wait. Some said they’d consider switching trustees, unhappy with current fees; others said they’d monitor a while longer and hold off. November 2012’s split public mood neatly foreshadowed the market pattern to come: many enquiries, few transfers.