The government’s bill for the city’s long-delayed non-mandatory central provident fund was finally passed by the legislature on Tuesday, eight years after it had first been presented by the government.
During a plenary debate about the bill’s outline, Secretary for Social Affairs and Culture Alexis Tam Chon Weng said he was “confident” that the government could convince the city’s major enterprises to take part in the fund.
The bill proposes that employers and employees can opt to pay into the central provident fund, each paying a minimum of five per cent of the employees’ basic wages per month into a provident fund account in the name of the employee. While it won’t be obligatory for bosses and their staff to contribute to the fund, the government plans to encourage their participation in it through a string of tax incentives.
According to the bill, an employee will get none of the money put by the employer if their employment lasts less than three years.
Staring with 30 per cent in the third year, an employee will get a 10 per cent increase of the share for each year he or she worked, reaching 100 per cent in 10 years of working for the same employer.
Following the bill’s passage, it is due to be passed to one of the legislature’s standing committees for in-depth debate and article-by-article review after which it will have to be resubmitted to a plenum for an article-by-article vote in its second and final reading.