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Author Archives: hksar gov

CE welcomes LegCo’s passage of amendment bill on abolishing “offsetting” arrangement under Mandatory Provident Fund

     The Chief Executive, Mrs Carrie Lam, welcomed the passage of the Employment and Retirement Schemes Legislation (Offsetting Arrangement) (Amendment) Bill 2022 by the Legislative Council (LegCo) today (June 9), referring to the passage as a significant milestone in enhancing retirement protection of employees. She thanked employers and employees for striving to build a consensus on abolishing the “offsetting” arrangement over the years. She also thanked the Labour and Welfare Bureau and the Labour Department for their perseverance in resolving this thorny issue.
 
     Mrs Lam said, “Given the rapid ageing of Hong Kong’s population, the issue of retirement protection has become more imminent. As early as when I served as the Chief Secretary for Administration and the Chairperson of the Commission on Poverty, I championed the need to strengthen the Mandatory Provident Fund (MPF) as one of the key pillars of Hong Kong’s retirement protection system, under which the community must duly address the ‘offsetting’ arrangement.”
 
     Under the Mandatory Provident Fund Schemes Ordinance passed in 1995, employers could use the accrued benefits of their mandatory contributions under the MPF System to offset, under specific circumstances, the expenses for severance payment and long-service payment shouldered by them. This would no doubt hamper the retirement protection accorded by the MPF to employees, especially the grassroots. During the implementation of the MPF Schemes over the years, the amount of contributions depleted as a result of the “offsetting” arrangement has been rising. The labour sector has requested that the “offsetting” arrangement be abolished as soon as possible, whereas the business sector has been concerned that abolishing the “offsetting” arrangement would increase the burden on employers and thus affect the business environment.
 
     “The previous-term Government conducted extensive consultations and made recommendations with a view to narrowing differences when it came to abolishing the ‘offsetting’ arrangement. When I ran for office as the fifth-term Chief Executive in 2017, I promised in my manifesto that we would listen to the views of both  the labour sector and the business sector, especially small and medium-sized enterprises, in order to reach a consensus on abolishing the ‘offsetting’ arrangement under the MPF System. After assuming office, I proposed in March 2018 a preliminary idea of key points on abolishing the ‘offsetting’ arrangement, and formally announced in the 2018 Policy Address an enhanced package to significantly increase the subsidy for employers, with the subsidy period extended from 10 years as proposed by the previous-term Government to 25 years, and the financial commitment of the entire government subsidy scheme thus increased from $7.9 billion as proposed by the previous-term Government to $29.3 billion (in 2016 prices),” Mrs Lam said.
 
     In the course of formulating the enhanced package and after announcement, the Labour and Welfare Bureau and the Labour Department have had frequent discussions with stakeholders including the Labour Advisory Board (LAB), key chambers of commerce, employers’ associations, labour unions, political parties, and relevant panels of the LegCo. Taking account of the business sector’s views, the 2021 Policy Address Supplement in October last year announced the refinement of the government subsidy scheme while maintaining generally the same amount of the Government’s financial commitment ($33.2 billion in 2021 prices) and the 25-year subsidy period, so as to focus more on supporting micro, small and medium-sized enterprises and provide more targeted assistance to help employers adapt to the policy change upon abolishment of the “offsetting” arrangement. The Government considers that these measures have addressed the concerns of the business sector while duly resolving the problem of the “offsetting” arrangement that has plagued the labour sector for years, and also create the necessary conditions for the full portability of the MPF.
 
     Mrs Lam expressed her heartfelt gratitude to all sectors of the community, especially the LAB and relevant employers’ and employees’ organisations, for upholding a mutual understanding coupled with rational deliberation over the years and offering valuable views on the proposed abolishment of the “offsetting” arrangement. Their efforts have facilitated the LegCo’s smooth passage of the Bill, which is hailed as a major achievement of the current-term Government in enhancing the retirement protection system of Hong Kong.
 
     The Government will press ahead with the ancillary arrangements for abolishing the “offsetting” arrangement, including setting up the government funding programme, following up in the next legislative session on a Designated Savings Accounts Scheme for employers to cope with future financial needs, and conducting extensive publicity with easy-to-understand information to help employers grasp the abolition of the “offsetting” arrangement and related ancillary measures. Following the full implementation of the eMPF Platform, which is being developed by the Mandatory Provident Fund Schemes Authority, the Government expects that the “offsetting” arrangement could be formally abolished in 2025. read more

Government finishes exercise on “restriction-testing declaration” in respect of specified “restricted area” in Tower 1, Lake Silver, Ma On Shan, and enforcement operation for breaches of compulsory testing notice

     The Government yesterday (June 8) exercised the power under the Prevention and Control of Disease (Compulsory Testing for Certain Persons) Regulation (Cap. 599J) to make a “restriction-testing declaration” with effect from 6pm yesterday, under which people (hereafter referred to as “persons subject to compulsory testing”) within the specified “restricted area” in Ma On Shan (i.e. Tower 1, Lake Silver, Ma On Shan, and certain designated area of the podium; excluding levels below the podium) were required to stay in their premises and undergo compulsory testing. Persons subject to compulsory testing were required to stay in their premises until all such persons identified in the “restricted area” had undergone testing and the test results were mostly ascertained. All persons in the “restricted area” who have tested positive in the past 14 days, including positive cases identified either by nucleic acid tests recorded by the Department of Health (DH) or by rapid antigen tests that have been self-declared to the DH, were not required to undergo testing in this compulsory testing exercise.
 
     In addition, the Government issued a compulsory testing notice yesterday, requiring persons, other than those specified above, who had been present at the above building for more than two hours from June 2 to June 8, 2022, even if they were not present in the “restricted area” at the time when the declaration took effect, to undergo compulsory testing on or before June 10, 2022.
 
     The Government finished the compulsory testing exercise at around 7.30am today (June 9) and carried out enforcement action in the “restricted area” afterwards to verify that all people in the “restricted area” had undergone compulsory testing in accordance with the requirements of the relevant declaration and compulsory testing notice. The Government announced that the enforcement operation ended at around 10.30am today.
 
     The Government provided food packs to persons subject to compulsory testing to facilitate their meal arrangements. Anti-epidemic proprietary Chinese medicines donated by the Central People’s Government or procured with the co-ordination of the Central People’s Government and rapid antigen test kits were also provided to persons subject to compulsory testing to help them fight against the virus.
 
     The Government thanks persons subject to compulsory testing for their support and understanding. With everyone’s co-operation and efforts, coupled with the efforts of the testing contractors throughout the night, residents have been informed about their testing results by SMS notification. After finishing the compulsory testing exercise at around 7.30am today, the Government took enforcement action in the “restricted area” immediately to verify that all people in the “restricted area” had undergone testing according to the requirements of the declaration and the compulsory testing notice. Persons who could present an SMS notification containing a negative test result as proof of having undergone the compulsory testing could leave the “restricted area” through the designated exit after providing personal information to a prescribed officer. The enforcement operation was completed at around 10.30am. Test records of 341 persons subject to compulsory testing were checked. One person was found not having undergone compulsory testing and a compulsory testing order was issued to him. Taking into account the above situation, the Secretary for Food and Health revoked the “restriction-testing declaration” in accordance with Cap. 599J (see attachment).
 
     The Government reminds the 38 households who have not answered the door to undergo a nucleic acid test as soon as possible after reading the notices put up by the Government, in the hope of eliminating the possible risk of further spread of the virus in the community.
 
     The Government thanks all participating government staff and the testing agencies for their hard work. The Government is also grateful to those subject to compulsory testing for their support and understanding, and their full co-operation during this period in undergoing testing and waiting for the results at home.
 
     The Government will seriously follow up on the compliance situation of the compulsory testing notices and the “restriction-testing declaration” by persons subject to compulsory testing. Any person who fails to comply with the compulsory testing notices commits an offence and may be fined a fixed penalty of $10,000. The person will also be issued with a compulsory testing order requiring him or her to undergo testing within a specified time frame. Failure to comply with the compulsory testing order or the “restriction testing declaration” is an offence and the offender would be liable to a fine at level 5 ($50,000) and imprisonment for six months.     read more