XN000022-1995-04-26 — Page 46

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Schemes to improve financial situation of elderly

The following is a question by the Hon JD McGregor and a written reply by the Secretary for Health and Welfare, Mrs Katherine Fok, in the Legislative Council today (Wednesday):

Question:

Elderly citizens who are now the recipients of the normal Old Age Allowance and the higher Old Age Allowance have been given the expectation that they would be able to receive an Old Age Pension of at least $2,300 per month at 1995 price levels. However, the abandonment by the Government of the proposed Old Age Pension Scheme has now left these elderly citizens without any apparent improvement to their small Old Age Allowances. In this connection, will the Government inform this Council what measures it now proposes to take to improve the financial situation of these elderly people estimated at over 400,000 who are not subject to inclusion in the Comprehensive Social Security Assistance Scheme, together with a timetable for the introduction of any such measures?

Reply:

The proposed Old Age Pension Scheme (OPS) was designed as a contributory scheme to provide income security for all eligible elderly persons. The Old Age Allowance for elderly persons is non-contributory and, apart from an income declaration for those aged 65 to 69, is a non-means tested grant. Our Comprehensive Social Security Assistance (CSSA) Scheme is designed to provide financial support to those in genuine financial need i.e. it is a means-tested welfare payment.

It is important that the fundamental differences between these various schemes are fully appreciated. The Government is proceeding with a mandatory privately managed provident fund scheme (the MPF) in place of the OPS to address the need for financial security in retirement. The Administration intends to introduce legislation to establish the MPF system in this legislative session.