TNAG-0747-FCO40-951-Visits-of-Foreign-and-Commonwealth-officials-to-Hong-Kong-1978 — Page 166

CONFIDENTIAL

asked that the rate of joint contribution should be increased to 10%. The Hong Kong Trade Union Council had impressed upon him that such a scheme would be popular with young workers although the employ- ers would disagree with this. Finally, Mr. Hurst said that he felt that more publicity should be given on, this scheme to arouse

the interest of workers.

H E said that the Government must first satisfy itself

that the benefits desired were actuarially possible on the levels

of contribution suggested. When this had been done, full publicity would be given and the scheme would get a comprehensive hearing from all sectors of the Community. This would undoubtedly take some time though he himself was a little disappointed with the time table envisaged by Mr. Heppell in the Green Paper. However every effort would be made to implement the scheme as quickly as possible. S for SS added that the Government Actuary's Department in London had already forwarded a first report and he was convening an early meeting to determine whether that was sufficient data for an initial view to be taken on it.

H E added that he felt the concept of a compulsory scheme

required much, further

though particular he was concerned that any

compulsory scheme would not undermine the advantages of a non- contributory scheme for people who now benefit or stood to benefit from the current public assistance scheme. Admittedly there could be certain advantages to the Government in a compulsory contributory scheme in that it would transfer responsibility for at least a proportion of the current PA clientele from General Revenue to the compulsory scheme. However the aim/to improve social security, not to save Government expenditure. He asked

Mr. Hurst for his views on how the two schemes could in fact be

reconciled.

was

Mr. Hurst said that this would really depend on advice from actuarial experts but his initial view was that the PA Scheme might then take on the role of a supplementary benefit

scheme as in the UK. HE felt that any contributory scheme was unlikely to produce as much ready benefits for the average worker as the PA Scheme did at present. He was not so much concerned with reservations expressed by others about the load of massive new deposits on the banking system or even the relevance of retirement benefits to the contributory scheme. He was much more concerned with the proposal by some elements that the contributory scheme musti

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