CONFIDENTIAL #
For discussion
on 28th July 1981
HKK 23411
Mr Withina 1.1
XCC(81)86 Copy No
MEMORANDUM FOR EXECUTIVE COUNCIL
Mo
Par 101.
SICKNESS, INJURY AND DEATH BENEFITS (SID): REVIEW OF PROPOSALS IN 1977 GREEN PAPER
MyFriar
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of 40
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see C +(3
Background
Chapter 8 of the Green Paper "Help for Those Least Able to App I Help Themselves" published in November 1977 floated the idea of a
voluntary contributory scheme of insurance against the risks of extended sickness, injury and death, with the possibility of a retirement benefit in the form of a "no claim" bonus. Given the wide measure of cover for the lower income groups already provided by Public Assistance (PA), Special Needs Allowances (SNA), the Criminal and Law Enforcement Injuries Compensation Scheme (CLEIC), the Emergency Relief Fund (ERF), the Traffic Accident Victims Assistance Scheme (TAVA) under consideration (and subsequently implemented), the Government finalised the other improvements proposed in the Green Paper (including improvements to PA, social security and services for the elderly), which were promulgated in the White Paper "Social Welfare Into the 1980's" and left over the SID benefits for subsequent consideration.
2
The Labour Advisory Board was consulted on the Green Paper Scheme and at a meeting on 16th March 1978, employees' representatives, while generally in favour of a compulsory contributory scheme, felt that the scheme was unattractive because the amount of benefit was small. They were of the opinion that there should be a 5% contribution from each side as against 2% proposed in the Green Paper. Employers' representatives, however, considered it more appropriate to extend the existing limit of sickness allowance benefits provided in the Employment Ordinance. As for death benefit, they suggested that private insurance might be the answer because some 30 months salary could be recovered at a premium of 1% of the workers' monthly earnings. Employers therefore suggested that retirement benefit should be examined separately.
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Following the Labour Advisory Board's consideration of the SID proposals, the Joint Associations Committee on Employers/Employees. Relations of the four major employers' associations suggested in a letter dated 4th April 1978 that it may be possible to develop an alternative to a Government scheme as mooted in the Green Paper. Under this suggestion an obligation to provide broadly equivalent benefits would be imposed on App II employers by law. No contribution by employees was envisaged under this
scheme, and the death benefit suggested would allow the family or a worker who dies under the age of 65 a lump sum equal to one month's salary for
G.S. 166
CONFIDENTIAL #B
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