Sunday 11th February 2007
Happy New Year! Yes, it's a bit late, but we'll try to make up for it with this in-depth series on the MPF and it's financially obese regulator, the MPFA.
MPF Part 1: What it Costs You
In Part 1 of our new MPF series, we look at the frightening first disclosures of expense ratios for MPF funds, and how this will crush the performance of the money trapped in the MPF schemes relative to the markets they invest in.
MPF Part 2: Stop the Increase
We call on the Government to stop the proposed increase in MPF contributions, which we estimate will cost HK$4.24bn per year. We renew our call to abolish the MPF and return economic freedom to the people. As more capital gets trapped in MPF funds, demands to withdraw it for urgent needs will become more frequent. And is Donald Tsang planning a Mandatory Medical Savings scheme?
MPF Part 3: The Bloated Regulator
MPF's regulator, the MPFA, was grossly overcapitalised at inception and has been waiving the annual registration fee it should be charging to trustees, thereby subsidising the industry at almost HK$200m per year. This fee should be collected to cover its costs, and the MPFA should return $5,000m of surplus capital to the Government.
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David M Webb