Independent pension report to use Tsang's data

PUBLISHED : Wednesday, 28 May, 2014, 4:19am
UPDATED : Wednesday, 28 May, 2014, 4:19am

An independent report calculating the financial implications of various retirement protection proposals - due at the end of June - will be based on "conservative" projections by a working group under Financial Secretary John Tsang Chun-wah.

Commissioned by the government last year, the report is tasked with making detailed calculations of five to six proposals - including one to establish a universal pension.

Professor Nelson Chow Wing-sun, who helms the project, said yesterday that the report would be based on projections by the Long-term Fiscal Planning Working Group.

"The decision [to use the working group's data] was a mutual one," said Chow. "It made sense for the government to use the same set of data in reports for better comparison."

Projections by the working group used in Chow's report include the population's rate of ageing, inflation, size of the working population and salary growth in the next 30 years.

The working group projects a gloomy picture of the city's future finances, warning that Hong Kong could face a structural deficit of HK$1.54 trillion by 2041 if the city's spending grows at the current pace and nothing is done to mitigate the impact of an ageing population.

Chow said the figures were "conservative", but added: "After the report is out if someone is not satisfied with the data used, it's possible to use another set using the model we've set up."

He refused to comment on recent claims in the media that using the working group's data would compromise the independence of his report.

Law Chi-kwong, member of the Commission on Poverty, said using the working group's projections was not likely to impact Chow's results.

Law said Chow's report would be handed to a steering committee under the government's Central Policy Unit, which would analyse the report before passing it to the Commission on Poverty.

Law said it was likely that the commission would be handed the full report, and that the contents would be made public.

Secretary for Labour and Welfare Matthew Cheung Kin-chung said: "I assure you that Professor Chow's report is still being conducted independently."