XN000022-1995-03-08 — Page 25

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Secondly, Mr President, on the point raised by one Member allegedly referring to my "previous colleagues" in this Council last year on the demerits, so called demerits, of the RPS. Can I remind that Member that the RPS was based on the '92 paper. All he said against those points in the RPS were the '92 paper on the particular system. It was not, it was not as stressed, relevant to the MPF which I now outline this afternoon, they are different things. Let me explain why they are different. Members, of course, mentioned also the need to get the wire report in 1993 on the RPS system. Again they are different systems and I would explain why they are different.

I am very surprised in fact that Mr Michael Ho is trying to distort things and trying to pull wool over our eyes to say that we are now trying to hide the RPS reports from Members because it is relevant to this debate. And my answer it is not relevant. Let me explain why. The RPS in 1992 called for all employees in full time. employment under the age of 65 to participate in retirement protection schemes unless specifically exempted. There will be no minimum wage level for making contributions, even those on very low salaries still needed to contribute. That was the 1992 system. It allowed the concept of preservation of benefits without portability. In that when an employee change job, it would have been able to leave his accrued retirement benefits frozen in the previous employer's retirement scheme. There was no provision to deal with those employers who might not be able to find a retirement scheme in the open market for that employee. There was no provision for any scheme to deal with benefit losses caused by fraud or theft. Let me ask you, is it the same as the MPF which I have just outlined? All these features are different from this present scheme which I outlined. How can they be relevant to present scheme? We are not asking Members to endorse an RPS or even amended version of it, we have since moved on. As Members would be aware from information which we gave them earlier on before this debate. And today this afternoon the MPF would differ from the RPS in many respects.

First of all, it would be a residual pool scheme to deal with those employers who are not able to find coverage elsewhere in the open market. Secondly, there will be a minimum salary level for contributing purposes to recognise that those on low incomes may find it difficult to make a contribution. Thirdly, there would be a scheme provision for a scheme to deal with benefit losses due to fraud or theft. And fourthly, we would not be allowing preservation without portability. We want both, preservation and portability in the MPS system, is not the same as the RPS.