XN000022-1985-04-17 — Page 16

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WEDNESDAY, APRIL 17, 1985

PENSIONS

DR HARRY FANG SUGGESTED THAT, BY WAY OF PROVIDING CIVIL SERVANTS WITH EVIDENCE THAT THEIR PENSIONS ARE BEING TAKEN CARE OF. THE GOVERNMENT SHOULD ISSUE ANNUAL STATEMENTS OF THEIR ACCUMULATED RIGHTS, SIMILAR TO THE STATEMENTS ISSUED TO PARTICIPANTS IN THE WIDOWS AND CHILDREN'S PENSIONS SCHEME.

I SHOULD EXPLAIN THAT THE WIDOWS' AND CHILDREN'S PENSIONS SCHEME IS A CONTRIBUTORY SCHEME. UNDER THE TERMS OF THE SCHEME, EACH CONTRIBUTOR IF ISSUED WITH A STATEMENT EVERY YEAR OF THE AMOUNT OF PENSION BENEFITS SO FAR ACCRUED FROM BOTH HIS ACTUAL AND THE GOVERNMENT'S NOTIONAL CONTRIBUTIONS IN THE EVENT OF DEATH.

UNLIKE THE WIDOWS' AND CHILDREN'S PENSIONS SCHEME, HOWEVER, THE CIVIL SERVICE PENSIONS SCHEME IS NON-CONTRI BUTORY. A SERVICE PENSION IS ONLY PAYABLE WHEN THE OFFICER RETIRES AND OF COURSE RETIRES UNDER APPROVED CIRCUMSTANCES. THE AMOUNT OF PENSION PAYABLE IS DEPENDENT ON THE OFFICER'S FINAL SALARY AND THE LENGTH OF HIS PENSIONABLE SERVICE ON RETIREMENT. IT IS NOT CALCULATED ON THE BASIS OF ACCRUED BENEFITS AND, THEREFORE, NO STATEMENT OF ACCUMULATED PENSION RIGHTS CAN BE ISSUED. OFFICERS THEMSELVES ARE, OF COURSE, QUITE CAPABLE OF MAKING A PROJECTION OF WHAT THEIR PENSION WILL BE ON THE BASIS OF EXISTING LEVELS OF REMUNERATION IF THEY RETIRE AT A CERTAIN TIME IN THE FUTURE. THE MATHEMATICS FOR DOING THIS ARE SET OUT IN ANNEX X11 TO CIVIL SERVICE REGULATIONS FOR THE BENEFITS OF THOSE WITH AN ALGEBRAIC TURN OF MIND. BUT NO PROJECTION CAN ACCURATELY PREDICT THE AMOUNT OF PENSION EVENTUALLY PAYABLE.

I SHOULD ADD THAT, WHILE STATEMENTS OF ACCUMULATED PENSION RIGHTS ARE NOT ISSUED, THE CIVIL SERVICE SHOULD HAVE NO DOUBT ABOUT THE PAYMENT OF PENSIONS AND GRATUITIES. SECTION IV OF ANNEX I OF THAT LEGALLY BINDING AGREEMENT, THE JOINT SINO-BRITISH DECLARATION, PROVIDES THAT THE FUTURE SAR GOVERNMENT WILL PAY ALL CIVIL SERVICE PENSIONS AND GRATUITIES, INCLUDING THOSE ALREADY IN PAYMENT IN 1997. IT ALSO PROVIDES THAT ALL PENSIONS AND GRATUITIES PAYABLE TO RETIRED CIVIL SERVANTS OR TO CIVIL SERVANTS' DEPENDANTS WILL BE ON TERMS NO LESS FAVOURABLE THAN BEFORE, AND THAT THEY WILL BE PAID IRRESPECTIVE OF THE BENEFICIARY'S NATIONALITY OR PLACE OF RESIDENCE.

/CONTRACT TERMS