Why Did an Editorial Urge Faster MPF Intermediary Rules and Free Choice?

Why Regulate Agents Before “Semi-Portability”?

The government had planned to launch “semi-portability” early this year, but chose to delay it and legislate intermediary conduct first, to guard against aggressive mis-selling or a repeat of the Lehman minibonds saga. The law should be simple and workable so members could soon choose who manages their money.

How Expensive Was MPF?

MPFA figures showed average net MPF returns of 5.5% a year over ten years after fees, well ahead of inflation — yet the Consumer Council had slammed fees as too high in 2007. On 40 years of contributions at 5% annual return, a 2% fee could see 40% of the pot end up with fund managers.

How Would “Semi-Portability” Force Fees Down?

It would let employees move their own contributions to a manager of their choice instead of the employer’s pick, creating an environment where managers cut fees to win business. The simpler the law and the closer it mirrors other financial-sector regimes, the fewer disputes and the sooner it takes effect — and higher take-home returns would ease public resistance to MPF.