A
CONFIDENTIAL
For discussion
on 14 January 1986
нин
01112
XCC (86)9 Copy No....
TEMORANDUM FOR EXECUTIVE COUNCIL
L-CEIVED IN REGISTR CURRENCY FLUCTUATION PROTECTION ARRANGEMENTS
OF STAFF TERMINAL BENEFITS SCHEME
10 JAN 1986.
DESK OFFICER
REGISTRY
INDEX Introduction Taken
بر
Ovi
On 18 June 1985, memorandum XCCI(85) 20 (copy at Annex A) was submitted to this Council to
to inform Members of the currency fluctuation protection arrangements under the Staff Terminal Benefits Scheme of the University of Hong Kong (HKU). Having noted the University's arrangements the Council advised and the Governor ordered that since the memorandum raised major issues a further submission should be made to seek the Council's advice on the policy
policy that should be followed in similar
similar instances in the future. The present memorandum responds to
to that remit and makes proposals with regard to the other institutions of higher education and other subvented organisations seeking to adopt similar arrangements. It also considers what action, if any, the Administration might take regarding the existing currency fluctuation protection arrangements of HKU.
Policy for Currency Fluctuation Protection Arrangements
2
At present, the HKU is the only higher educational institution which has incorporated currency fluctuation protection arrangements in its staff terminal benefits scheme. It is understood that none of the four other institutions subvented through the University and Polytechnic Grants Committee (UPGC) (the Chinese University of Hong Kong, the two polytechnics and the Hong Kong Baptist College) or any other organisation receiving government subvention has adopted similar arrangements.
3
Although there are no other government-subvented organisations having or contemplating the introduction of a similar currency fluctuation protection clause in their superannuation schemes, there have been demands from civil service unions for protection of pensions against currency fluctuations. Such demands have so far been resisted on the grounds that pensions earned in the service of the Hong Kong Government are and should continue to be paid in Hong Kong dollars. On the general question about whether there should be a protection clause against currency fluctuations in staff benefits schemes, the Administration considers that in so far as it relates to the civil service and employees of government-subvented organisations, people employed in Hong Kong and paid in Hong Kong dollars do not require and should not expect such protection.
CONFIDENTIAL