10.
Page 56
5003ECRET
Page 56
In spite of the improvements of recent years, there are weaknesses or gaps in the social security system, though
to some extent these are attributable to the absence of any
contributory element. There is no direct provision for
unemployment benefit (though in Asia such benefits are only
paid in Japan, and in Hong Kong the requirement is to some extent met by public assistance). Pensions are small and are available only to persons of 75 and over; though medical
treatment is available without contributions, sickness benefit
is an employer's liability and does not extend beyond 24 days (though public assistance would be available). Similarly there
is no pension for widows as such, though they are eligible
for public assistance. The full details of the current scheme
are in Annex D. There appear to be two alternatives. The first
is to build on the present scheme whose administration is now
well established, is working well, and is technically capable of considerable modification or expansion if such are considered
desirable. By such means a complete system of social security
based on need, however defined, could be established. Alter-
natively a new system based on compulsory contributions by
employers and employees could be substituted within the form
of a Provident Fund or along UK lines. The objections to either
of the latter concepts is that with the uncertain future of Hong
Kong the population would resent deductions from their disposable income now in return for a promise of financial security at a later date. There is also the subsidiary difficulty of the
effect on costs that the employers' contributions might have. The Governor considers that the difficulties of gaining
acceptance for such a scheme are too great, and the benefits it could confer before the mid 80's too small in comparison
to those that could be made available under the existing scheme to justify its introduction. The most useful social aspect
of the Singapore Provident Fund has been the facilities it
provides for home purchase; the Hong Kong Government accepts
that provision of such facilities for the low income bracket is
desirable and is at present working out a scheme.
8
•
9
Page 56
Page 56
Page 56
i