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The MPFA welcomes the passage of the Mandatory Provident Fund Schemes (Amendment) Bill 2021 (the Bill) by the Legislative Council (LegCo) today (22 October 2021).

Mrs Ayesha Macpherson Lau, Chairman of the MPFA, said, “The passage of the Bill marks another significant milestone in the implementation of the eMPF Platform project. The eMPF Platform will standardize, streamline and automate the administration processes of MPF schemes and thus increase the operational efficiency of the MPF System, thereby creating further room for fee reduction for the benefit of MPF scheme members. It is estimated that the project will achieve a cumulative saving of administration costs amounting to an estimate of $30 billion to $40 billion over a 10-year period. The cost savings arising from standardised, streamlined and automated administration processes will be “straightly passed on” leading to a corresponding reduction in overall fees and charges of MPF funds, which will continue in the years to come as the eMPF Platform fee further falls in a gradual manner.”

With the streamlined MPF scheme administration workflow following the implementation of the eMPF Platform, the regulatory burden on trustees will also be reduced. The project will bring tremendous benefit to various stakeholders of the MPF System including employees, employers, self-employed persons and the industry. 

Further to the passage of the Mandatory Provident Fund Schemes (Amendment) Bill 2019 on 17 July 2020 which empowered the MPFA to set up a wholly-owned company, the eMPF Platform Company Limited (the Company), to take forward the eMPF Platform project, the current Bill provides the legal basis for the designation of the eMPF Platform as the common gateway for scheme administration processes in the MPF System; delineates the respective roles, functions, powers and responsibilities of relevant parties; stipulates the “straight pass-on” requirement in respect of cost savings to benefit MPF scheme members directly; and introduces technical amendments to reflect the streamlined MPF scheme administration workflow. It will also lower the out-of-pocket expense cap of the Default Investment Strategy constituent funds from 0.2% to 0.1% of net asset value per annum and enhance the transparency of the MPF funds by requiring further disclosure of estimates on fees and investment return.

The MPFA awarded the contract for the design, build and operation of the eMPF Platform in January 2021 and established the Company in March 2021. The Company and the contractor, with the cooperation of the industry, are pressing ahead at full steam on the development of the eMPF Platform. Subject to the orderly transition by trustees in sequence starting from early 2023 the earliest, the eMPF Platform would come into full operation in early 2025 the earliest.

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22 October 2021