CY Leung promises to resolve MPF offset controversy before term ends

But Chief Secretary Carrie Lam says actual implementation of such a change will have to left to the next administration

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As part of his election manifesto in 2012, Chief Executive Leung Chun-ying promised to ‘progressively reduce’ the proportion of the employer’s contributions to the MPF that could be used for offsetting. Photo: Edward Wong

Published: 1:45pm, 29 Sep 2016Updated: 4:10pm, 30 Sep 2016

Chief Executive Leung Chun-ying has promised to sort out a controversial clause in Hong Kong’s official pension scheme that is the source of much friction between employers and workers within the remaining months of his current term as the city’s leader.

During a meeting with the Federation of Trade Unions yesterday, Leung discussed the possibility of scrapping the offsetting mechanism that allows employers to settle severance and long-service payments using employees’ Mandatory Provident Fund savings.

The Chief Executive’s Office followed up with a written statement saying Leung would, within this term of government, “expend the greatest effort” to tackle the offsetting mechanism as promised in his election manifesto.

Chief Secretary Carrie Lam Cheng Yuet-ngor also said yesterday that the unpopular arrangement was a priority for the government, but she did not expect new arrangements could be ready by the end of its term, which expires next June.

Back from a trip to Europe, Lam said: “The offsetting issue is one of the issues that we shall handle in the next nine months ... It is hoped we can come up with a policy direction within this term.

“As for the corresponding implementation work, it may have to be handled by the next term of government.”

Unionist legislator Alice Mak Mei-kuen, speaking after meeting Leung, said: “The chief executive said he takes this [issue] very seriously, and he aims to solve this problem within his term of office.”