CODE 18 - 77
LA/HK/2
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Reference.....................
KAR
Miss Wills
HKGD K 245
SOCIAL SECURITY DEVELOPMENTS IN THE REPUBLIC OF KOREA
71
1. You asked for my comments on Mr Morris's letter 212/1 of 28 September and its implications for social security schemes in Hong Kong.
2. The starting point is the speech made by the Governor at the opening of Hong Kong's Legislative Council in October 1976 when he announced "a new and special emphasis on labour legislation and social welfare" and stated that the Government would achieve a level of legislation at least broadly equivalent to the best in neighbouring countries within 5 years.
3. If these standards of comparability are to be maintained, it will be necessary for Hong Kong to take account of developments in Korea. These developments now include provision in 1980 (para.6 of Mr Morris's letter and paragraph 2.1.2 of the enclosure thereto) for all residents between the ages of 18 and 60 to be protected against the long-term risks associated with old age, disability and death. Premium costs are to be shared jointly between employers and employees at the level of 3 to 7% of the employee's monthly earnings. As you know, we have set great store on the establishment of a compulsory contributory scheme in Hong Kong which provides, inter alia, for retirement benefits or old age pensions.
4.
The Governor has so far been reluctant to concede the need for old age pensions and the Korean objectives, if they are put into effect, might provide us with some useful ammunition in the light of his 1976 speech to Leg. Co. It is a pity that the Korean Plan does not include provision for unemployment benefit, to which we have attached importance in Hong Kong!
5. The Governor has questioned the role of the public assistance scheme in Hong Kong if a contributory social security scheme is developed. It is therefore of interest to us that the Korean Plan envisages the expansion of their PAS as part of the gradual expansion of that country's social insurance programmes.
6. I do not think any immediate action is necessary until we have had time to study the complications which are delaying preparation of Hong Kong's social security schame (HK Tel No 1173 and FCO Tel No 773 of 10 October). In the meantime, in thanking Mr Morris for his letter, it might be timely to ask him to report any significant developments in this field as they occur in Korea.
10
HKK 234/1
RECEIVED IN REGISTRY NO. 51
16 OCT 1978
DESK OF ICER
REGIOTRY
INDEX
PA
Action Ten
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Fors that
HRG Hurst
Overseas Labour Adviser
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