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Withdrawal of benefits
I now turn to withdrawal of benefits. One of the provisions in clause 14 of the Bill deals with circumstances for the early withdrawal of accrued benefits from a registered scheme. These include provision for the purpose of set-off, as prescribed in the Employment Ordinance, in respect of that part of the accrued benefits which are derived from a current employer's contributions (quantified in accordance with rules made by the Authority under clause 45), at such time as the relevant employee becomes entitled to severance payments or long service payments. This is in line with our policy intent to enable the long established set-off procedure under the Employment Ordinance in respect of schemes under ORSO to continue for MPF schemes. We have made it very clear that employers are not expected to pay twice under the new system.
Long Service Payment/Severance Payment
Some Members I know are not in favour of retaining this policy for the MPF, and I understand that one Member will move a CSA later on with the aim of delinking contributions to MPF schemes from statutory obligations in respect of long service or severance payments. We do of course realise in the longer term the interface of LSP and SP with MPF need to be examined. It will take time to consider this important issue given its widespread implications for both employers and employees. The Labour Advisory Board, which provides the best forum for employer and employee representatives to discuss labour matters of mutual concern, will be consulted. It would be preferable, therefore, to await the advice of the LAB before taking our next step.
The MPE Authority
I now turn to the MPF Authority. We envisage that the MPF system will be both efficient and streamlined. The trustees, who will have primary responsibility for the operation of the MPF Schemes, will be providing their services under consistent and transparent operational rules to be provided by the Mandatory Provident Fund Schemes Authority (MPFA). Thus neither will the service providers in the MPF system become gigantic bureaucracies nor will the MPFA grow into a monstrous regulatory body. The monitoring of schemes and trustees will be carried out by teams of professional staff having intimate knowledge of how the market operates. We expect the MPFA to be a stream-lined body. It would carry out random inspections and monitor the schemes' books and accounts.