Chief executive urged not to restrict raiding of pension funds to cover severance pay-outs
EDDIE LEE eddie.lee@scmp.com
PUBLISHED : Friday, 11 December, 2015, 12:01am
UPDATED : Friday, 11 December, 2015, 12:01am
Andrew Leung Kwan-yuen of the pro-establishment Business and Professionals Alliance urged the government to study carefully the likely impact of scrapping the practice before taking action. Photo: SCMP Pictures
Employers attending a symposium on the practice of letting company bosses use their contributions to employees' retirement savings to offset severance and long-service payments unanimously opposed the abolition of the mechanism yesterday.
The business leaders vowed to take follow-up action if the government went on to change the system, without specifying what might be done.
Leading the chorus of opposition, Andrew Leung Kwan-yuen of the pro-establishment Business and Professionals Alliance urged the government to study carefully the likely impact of scrapping the practice before taking action.
The administration should stick to Chief Executive Leung Chun-ying's vision of seeking change while maintaining stability, he said.
The city's business heavyweights have condemned Leung's promise, made in his manifesto for the 2012 chief executive election, to seek to lower the withdrawals by business owners to offset long-service or severance payments.
"The adjustment of the Mandatory Provident Fund's offset mechanism would lead to a worsening of the business environment," said Stephen Ng Tin-hoi, deputy chairman of the Hong Kong General Chamber of Commerce.
Heads of trade associations took turns to argue that an abolition would increase costs, saying that cash-strapped small and medium-sized enterprises would be hit hardest.
Secretary for Labour and Welfare Matthew Cheung Kin-chung was invited but failed to attend, according to the alliance, which co-organised the event with 14 trade bodies.
It was the second initiative by the business sector in about two weeks to defend the MPF offset system.
Last week, the Hong Kong Business Community Joint Conference placed advertisements in two Chinese-language newspapers opposing an abolition of the arrangement.
Unionists have long fought for cancellation of the mechanism, and put pressure on Leung to honour his promise.
Federation of Trade Unions lawmaker Tang Ka-piu, who did not attend the forum, said he was "prudently optimistic" about the system being scrapped.
"I hope the business sector can join the discussion in a rational manner," Tang said, adding that many economists had already argued that the offset mechanism dented the effectiveness of the MPF system.
A consultation paper on the Mandatory Provident Fund set to be released by the government before Christmas is expected to address the idea of abolition.
http://m.scmp.com/news/hong-kong/economy/article/1889575/hong-kong-business-forum-urges-chief-executive-not-touch-mpf
