TNAG-0789-FCO40-993-Development-of-social-policy-in-Hong-Kong-proposed-contribut-1978 — Page 53

CONFIDENTIAL

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M

Mr Murray

PS/Ford Goronwy Reberts

Mr.

HONG KONG : PROPOSED SOCIAL SECURITY SCHEME

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1. The Hong Kong Secretary for Social Services has forwarded for our comments a draft memorandum seeking Executive Council

advice on whether a Social Security Scheme should now be intro- duced in Hong Kong, and if so in what form. This is not yet the draft White Paper which the Governor promised to let us see, but since it seeks to lay down the policy guidelines on which the White Paper will be based, we must clearly ensure that no tricks are missed at this stage.

2. The memorandum describes three alternative options and discusses their advantages and disadvantages. The options are:-

(a)

(b)

(c)

a scheme which would be run entirely be employers who would be obliged by law to provide benefits broadly equivalent to those proposed in the Green Paper of November 1977. Employees would not contribute;

a semi-voluntary contributory scheme as proposed in the Green Paper;

a fully compulsory contributory scheme.

weighted

We have consistently expressed a strong preference for a compulsory scheme because it would provide the best basis on which to build later. It is therefore satisfactory that the arguments are strongly/ in favour of option (c) above.

3. The main weakness of the memorandum is the lack of any firm commitment to the introduction of a Social Security Scheme as a matter of Government policy. It would be unrealistic to expect the Hong Kong Government to introduce at the outset a fully fledged

CONFIDENTIAL

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