XN000022-1979-11-01 — Page 16

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THURSDAY, SOVEMBER 1, 1979

MR. SO GAVE FURTHER REASONS WHY CREDIT UNIONS IN HONG KONG SHOULD NOT BE CHARGED THE TAX.

HE POINTED OUT THAT THE CREDIT UNIONS WERE GIVEN LEGAL STATUS WHEN THE CREDIT UNIONS ORDINANCE WAS PASSED IN 1968. WHEN

INTRODUCING THE BILL, THE THEN ATTORNEY GENERAL HAD SAID HE HOPED THEY WOULD PROVIDE A READY SOURCE OF CREDIT, WITH A MINIMUM OF INCONVENIENCE, FOR THE LOW SALARIED WORKER WHO FINDS IT DIFFICULT OR EVEN IMPOSSIBLE TO BORROW OTHERWISE THAN AT VERY HIGH RATES OF INTERESTS.+

IT WAS ALSO NOTED BY HIM AT THAT TIME THAT YOUNGER MEMBERS OF THE COMMUNITY SHOULD BE ESPECIALLY BENEFITTED, SINCE ONE OF THE MAIN AIMS OF THE CREDIT UNION IS TO INCULCATE THRIFT AND TO TEACH MEMBERS THE WISE USE OF MONEY.

IN HONG KONG TODAY, MR. SO SAID, THERE ARE 51 CREDIT UNIONS WITH A TOTAL MEMBERSHIP OF NEARLY 12 000 DRAWN FROM DIFFERENT WALKS OF LIFE. MEMBERSHIP INCLUDES CIVIL SERVANTS, RESIDENTS IN HOUSING ESTATES, COMPANY EMPLOYEES, HANDICAPPED PEOPLE, HOSPITAL STAFF AND SMALL FACTORY OWNERS.

THEY HAVE FREELY AND VOLUNTARILY SAVED A TOTAL OF $12 MILLION TO HELP THEIR FELLOW MEMBERS IN NEED. THEY DO NOT ASK FOR OR RECEIVE ANY SUBSIDY FROM THE GOVERNMENT. EVERY CENT WHICH THEY LEND TO THE IR MEMBERS COMES FROM THE IR OWN VOLUNTARY SAVINGS. A SMALL INTEREST OF ONE PER CENT OR LESS ON THE REDUCING BALANCE OF THE LOAN IS CHARGED TO THE BORROWERS, TO DEFRAY THE RUNNING COST, AND THE BALANCE IS DISTRIBUTED TO THE MEMBERS AT THE END OF THE YEAR. RUNNING COSTS ARE KEPT LOW BECAUSE ALL THE SERVICES ARE PROVIDED ON A VOLUNTARY BASIS AND IN FACT ABOUT 900 MEMBERS SACRIFICE THEIR TIME AND ENERGY AFTER WORK TO CATER FOR THE NEEDS OF THE IR FELLOW-MEMBERS.

HE SAID IF THESE CREDIT UNIONS HAVE TO GO INTO LIQUIDATION, THE 12 000 MEMBERS AND ALL THOSE WHO ARE PREPARING TO FORM CREDIT UNIONS AND THOSE SETTLING IN THE NEW TOWNS WHERE THERE ARE AS YET NO CREDIT UNION WILL NO LONGER FIND READY CREDIT AND MAY BE THROWN BACK INTO THE HANDS OF LOAN-SHARKS.

IN FACT, HE POINTED OUT, STATISTICS SHOW THAT LOAN-SHARKS AND MONEY-LENDERS ARE STEADILY EXPANDING THEIR ACTIVITIES,

IN THE FINANCIAL YEAR 1978-79, THE TOTAL NUMBER OF REGISTERED MONEY-LENDERS WAS 1 295. IN THE FIRST SIX MONTHS THIS YEAR, THE NUMBER OF ANNUAL REGISTRATIONS HAD ALREADY REACHED 765, AND ACCORDING TO THE POLICE, MANY OF THE RECENTLY REGISTERED MONEY- LENDERS WERE IN FACT LOAN-SHARKS, USING THE SAME METHODS AS BEFORE AND CHARGING SIMILAR HIGH RATES OF INTEREST.

THE 12 000 EXISTING MEMBERS AND THEIR FAMILIES AND MANY OTHERS WILL HAVE SECOND THOUGHTS ABOUT THE GOVERNMENT'S SINCERITY IN ITS REPEATED STATEMENTS ABOUT ENCOURAGING SELF-HELP PROJECTS.

+THEY WILL ALSO ASK WHY IS IT THAT THE INLAND REVENUE DEPARTMENT IS SPENDING SO MUCH ENERGY IN HOUNDING A LOW INCOME GROUP WHEN ALL THE WORLD SUSPECTS THAT MANY RICH PEOPLE IN HONG KONG ARE CONSTANTLY TRYING TO EVADE TAX IN ONE FORM OR ANOTHER,+ HE SAID.

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