XN000022-1993-01-07 — Page 5

THURSDAY, JANUARY 7, 1993

ENSURE THE

MR

SHIPMAN SAID THE REGISTRAR WAS NOT IN A POSITION TO THAT THE ASSETS OF RETIREMENT SCHEMES WERE WELL MANAGED AND THAT SCHEMES REMAIN SOLVENT.

"HE WILL HAVE

NOR NEITHER THE POWERS

SUFFICIENT STAFF

TO

THAT

UNDERTAKE THE INVESTIGATIONS THAT WOULD BE NECESSARY TO ACHIEVE OBJECTIVE, HE SAID.

++

ORDINANCE THE

DOES NOT PROVIDE THE REGISTRAR POWERS OF REGULATION, SIMILAR TO THOSE WHICH INSURANCE MAY WIELD.

WITH PERVASIVE

THE

COMMISSIONER

OF

"HIS

WOULD SUGGEST,

TO CHECK

WILL ESSENTIALLY BE WHAT THE TITLE ROLE NAMELY TO

MAINTAIN THE REGISTER OF RETIREMENT SCHEMES AND WHETHER CERTAIN REQUIREMENTS HAVE BEEN MET,

"HE

WILL

RETIREMENT

SCHEME SCHEME

NOT BE EMPOWERED TO DIRECT HOW A SHOULD BE MANAGED. HIS ULTIMATE SANCTION WILL BE TO REMOVE A FROM THE REGISTER, IN WHICH EVENT THE SCHEME WOULD HAVE TO BE WOUND UP AND THE AVAILABLE ASSETS DISTRIBUTED AMONG THE MEMBERS.

INTO WILL COME

THE OCCUPATIONAL RETIREMENT SCHEMES ORDINANCE WAS PASSED LAW BY THE LEGISLATIVE COUNCIL LAST MONTH. THE ORDINANCE INTO EFFECT IN JULY THIS YEAR.

REGULATED

PRIVATE SECTOR RETIREMENT SCHEMES ARE NOT AT PRESENT BY ANY GOVERNMENT AUTHORITY. THERE ARE ABOUT 12,000 SUCH SCHEMES WHICH HAVE BEEN

REVENUE WITH THE INLAND

DEPARTMENT

EXEMPTION,

THE TOTAL NUMBER OF SUCH SCHEMES IS

REGISTERED

BUT CLOSER TO 22,000.

"WHETHER

FOR TAX

TO RECKONED

BE

OF SUCH

ON THE AND,

SOLVENCY

THIS IS SUFFICIENT TO ENSURE THE SCHEMES WILL DEPEND ON THE PRUDENCE AND INTEGRITY OF THE EMPLOYER THE PERSON

ADMINISTRATOR, WHOM HE APPOINTS AS THE SCHEME VIGILANCE AND PROFESSIONAL COMPETENCE OF AUDITORS AND ACTUARIES PERHAPS MOST OF ALL, ON THE VIGILANCE OF SCHEME MEMBERS.

"WE

AND

1.

WOULD NOT, HOWEVER, CLAIM THAT THE ORDINANCE WILL FRAUD OR

INSOLVENCY FROM OCCURRING IN THE MANAGEMENT SCHEMES IN FUTURE, MR SHIPMAN SAID.

PREVENT OF RETIREMENT

BE

AND

IN PLACE FOR CERTAIN

THE LEGISLATION REQUIRES CERTAIN SAFEGUARDS TO

A

SCHEME

WOULD

BEFORE

QUALIFY FOR PROCEDURES TO BE FOLLOWED THEREAFTER.

REGISTRATION

"WHILE THESE SAFEGUARDS SHOULD MAKE FRAUD OR MISMANAGEMENT MORE DIFFICULT, THEY CANNOT PREVENT THEM FROM OCCURRING, AND SCHEME MEMBERS

++ HE SAID. SHOULD BE VIGILANT IN THEIR OWN PROTECTION,

MR SHIPMAN POINTED OUT THAT THIS LEGISLATION IS NOT SEEN TO THE FINAL ANSWER OR THE FINAL REGULATORY STEP.

"IT WAS ACKNOWLEDGED TO BE ONLY 'A REASONABLE AND FIRST STEP'. EXPERIENCE WILL NO DOUBT POINT TO AREAS WHERE SAFEGUARDS AND CONTROLS ARE NEEDED.

BB

PRACTICABLE

ADDITIONAL

/"MOREOVER, THE