The “Ten Sins” of MPF: Unions List a Decade of Failings

As MPF turned ten in December 2010, unions and advocacy groups marked the occasion by listing the system’s “ten sins” — a decade of high fees, thin protection, and the offsetting mechanism devouring workers’ savings.

What are the ten sins?

High fees, low returns, offsetting, poor coverage — the full charge sheet. The unions’ list includes: excessive fund fees eating returns; employers offsetting severance and long-service payments against MPF contributions; inadequate cover for the self-employed and low earners; patchy intermediary quality; opaque information, and more.

Which sin hurts workers most?

The offsetting mechanism. Employers can use their MPF contributions to offset severance or long-service payments — so a sacked or retiring worker finds the employer’s share already netted off, sharply cutting what lands in hand. Unions have demanded its abolition for years; the government has yet to agree.

What do they want?

Lower fees, no offsetting, wider protection. The demands: legislate fee controls, scrap offsetting, extend coverage to the incomeless such as housewives, and build universal retirement protection. Compare MPF funds’ fee levels at MPF fund comparison.