New rules, little enthusiasm: 65% unaware November brings transfer rights

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

A University of Hong Kong Public Opinion Programme survey of 1,005 MPF contributors aged 18 to 65, interviewed by phone between 6 and 20 July 2012, found 65% didn’t know the November Employee Choice Arrangement would let them move contributions to other MPF providers — lukewarm reception was the market talking point that August.

What did workers misunderstand?

MPF splits into employee and employer portions, each 5% of relevant income. Under the old system employees couldn’t choose where contributions went; the new scheme offered one transfer chance a year.

Why wouldn’t they switch?

Though choice was coming, half said they wouldn’t bother; only 11% would. “Too much trouble” topped reasons (29%), followed by “no reason to change” (22%). Confidence also ran low: 84% scored the system below 5 out of 10, averaging 3.7.

The expert view

The chief executive of a local MPF consultancy called the per-member average of HK$160,000 — grown over a decade since December 2000 — “a sizable amount of cash” with greater potential if actively managed, urging employees to seize the new arrangement. Fees topped scheme-choice criteria, followed by own risk appetite and trustee track record; about 70% wanted control over buy/sell timing and pricing — but MPF trades at “unknown prices”, an expectation-reality gap.

The MPFA responded it would do its best to raise public awareness before the launch.