Hong Kong leader vows ‘utmost’ effort to fix notorious pension fund problem, but has only two weeks left

Chief Executive Leung Chun-ying says he will do ‘utmost’ to resolve matter, which has ‘dragged on for long time’

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Chief Executive Leung Chun-ying meets protesters before the Executive Council meeting. Photo: Nora Tam

Published: 12:28pm, 13 Jun 2017Updated: 11:21pm, 13 Jun 2017

With only two weeks left on the job, Hong Kong’s leader has vowed to do his “utmost” to scrap a controversial arrangement that allows employers to dip into workers’ pension funds for severance and long-service payments.

Chief Executive Leung Chun-ying, whose term expires on June 30, made another commitment on Tuesday to fixing the problem amid media reports that he would discuss with his cabinet, the Executive Council, in the morning whether to endorse a proposal tabled in January for his successor, Carrie Lam Cheng Yuet-ngor, to follow up on after July 1.

During his final policy address in January, Leung had proposed offering a one-off subsidy of HK$6 billion to employers to alleviate financial pressure over a decade after barring them from using the money they put into workers’ Mandatory Provident Fund accounts to offset severance and long-service payments.

Sacked employees are entitled to severance payments under the law, but the offsetting mechanism has long been unacceptable to labour groups and Leung’s proposed solution has not gone down well with either side.

Members of the Hong Kong Federation of Trade Unions demand the scrapping of the MPF offsetting mechanism. Photo: David Wong

Chinese-language newspapers had quoted sources saying that Exco would discuss on Tuesday whether to endorse the proposal.

Leung did not comment on such reports before his cabinet meeting, but he said: “There is a detailed proposal in the policy address in January. This issue is complicated and has dragged on for a long time, so I will do my utmost to finish my work on this issue before my term expires.”