Hong Kong Investment Funds Association has urged more exposure to different markets and investment vehicles to the MPF funds.
Suggestions include adding both the Shenzhen and Shanghai stock exchanges, as well as the relevant mainland central securities depository to the respective MPFA-approved lists.
It says investment restrictions should also be relaxed, such as the eligibility of real estate investment trusts and exchange traded funds.
HKIFA chairman Arthur Bacci, pictured, said the current contribution rate is not enough to meet retirement needs. He urged the government and other relevant authorities to explore the feasibility of increasing the mandatory ratio, which is currently 10 percent.
The HKIFA also suggested there should only be one regulatory authority to solely coordinate MPF funds in order to streamline the product approval process.
Instead of having to obtain approval from two regulators - MPFA and the Securities and Futures Commission - having only one regulator would enhance efficiency and reduce duplication, which was in line with the government's objective of driving down costs.
The regulatory framework should also be reviewed in order to clarity uncertainty and facilitate more extensive usage of online, digital and mobile means to access advice for MPF investment purposes, such as suitability assessment.
The HKIFA also called for the removal of regulatory impediments that have prevented providers from providing an integrated approach to cater for employees' total portfolio needs.
Currently, providers cannot leverage on MPF contributions to complement employees' other investment needs, such as offering retail fund products.
According to Luk Kim-ping, chairman of the pensions sub-committee, the government and other relevant stakeholders should start exploring the third pillar of old age protection, ie, voluntary private funded accounts including individual saving plans and insurance.
Incentives and measures should be provided to foster the development of personal private pensions, such as tax incentives to employees to encourage voluntary contributions.
Public awareness of managing longevity and other related risks of pension products should also be raised.
It suggested that the government should educate the public about the need to prepare for retirement by introducing life-planning tools, research and surveys, and capacity- building programs.