Unions called the MPF “semi-free choice” scheme barely a quarter free

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

Era context: The original was brief, capturing the tug-of-war between the MPFA and labour unions on the eve of launch. In September 2012, with two months to go before the November 1 start, the authority briefed media and framed the reform as “starting small” — while unions said the so-called free choice did not even amount to half, at most a quarter.

The MPFA reminded workers that under the new arrangement they would get one chance per year to transfer all past employee contributions, but each month’s new employee contributions would still flow into the employer-designated account. The authority explained the policy aimed to sharpen industry competition and push management fees down — not to add administrative burdens on employers — hence the incremental approach.

Why did unions say it was only a quarter free?

Unions criticised the scheme as “hands tied”, arguing the real degree of freedom was nowhere near half — a quarter at most. Still, the commentary conceded that reform had to balance workers’ interests with employers’ difficulties and could not happen overnight.

The original also noted: if the early phase delivered what the MPFA hoped for — keener competition, fees down to reasonable levels, more portfolio choices — workers might not even need to switch accounts often. Once employees and employers were familiar with the mechanics, acceptance of full portability would grow.