Nine months of Employee Choice Arrangement: members shop around more

This article is a rewrite of a report from August 2013.

About nine months after the Employee Choice Arrangement (MPF semi-portability) launched, market response was warming up. Manulife published a client survey in August 2013: while the share of members switching trustees remained low, those actively enquiring and comparing schemes had clearly grown — a “shop around” mindset was forming.

How do members choose trustees?

The survey found fund performance topped members’ priorities, followed by fee levels, then service quality. Transfer procedures had gradually simplified since launch, averaging three to four weeks. Notably, many members still misunderstood the process — some thought switching meant “restarting contributions after changing jobs” — when only accrued benefits move; contribution arrangements are unaffected.

Three questions before switching

• How’s the performance: compare peers’ long-term net returns, not one year alone
• Are fees reasonable: compare expense ratios and whether fees match performance
• Does the service fit: online platforms, customer service, fund-choice breadth

Not switching is fine too

The arrangement grants a right to choose, not a duty to switch. Even without switching, regularly reviewing your scheme’s fees and performance is responsible behaviour. Competition-driven fee cuts benefit all members.

The Employee Choice Arrangement is explained in the MPF education guides.