The Government appreciates that HKU, as with other institutions of higher education, has considerable autonomy in determining salaries and conditions of service for its staff, subject to the salary scales being approved formally by the Government and to the terms and conditions of service the University offers to its staff being held close to, but not being overall more favourable than, those applying to the civil service. The Government is concerned,
however, that not only does the inclusion of the Currency Fluctuation Clause affect significantly the comparability between the Staff Terminal Benefits Scheme and the civil service pension scheme in favour of the HKU staff but that it might give rise to questions about the attitude of a major institution of higher education towards the strength of the Hong Kong dollar and, more important, the underlying issue of the future of Hong Kong.
As I believe that your Committee was not consulted by HKU before it introduced the clause in question, I should be most grateful for any views your Committee may have on this matter. The Government is extremely concerned that the other UPGC-funded institutions and, indeed, other subvented organizations might well follow HKU's practice by augmenting their superannuation schemes with a similar protection clause.
Yours sincerely,
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(J.N. Henderson)
Secretary for Education & Manpower