Hong Kong’s Mandatory Provident Fund (MPF), which was established a quarter-century ago, has grown into a retirement scheme with around HK$1.5 trillion (US$192.3 billion) of assets, covers almost 100% of the city’s workforce, and has seen a jump in voluntary contributions.
Ayesha Macpherson Lau, chairperson of the Mandatory Provident Fund Schemes Authority (MPFA), the industry regulator, notes that at the time the fund was launched in December 2000, only around one-third of Hong Kong’s work force had some form of pension coverage.
She says voluntary contributions accounted for 25% of total MPF contributions in the first nine months of this year, almost doubling from 13% a decade ago.
“This reflects growing public confidence in the MPF as an effective tool for enhancing retirement reserves,” she writes in a blog post published on the MPFA’s website on December 9.
She described the introduction of the centralised digital eMPF in mid-2024 as the “most significant reform” of the retirement scheme by streamlining administration process and reducing fees.
“Once an MPF scheme joins the platform, its administration fee must not exceed the prevailing fee of 37 basis points charged by eMPF,” Lau says. There are 24 MPF schemes.
Lau expects around ten million MPF member accounts or 90% of the total to benefit from the lower fees.
