Budget policies announced on Wednesday for the elderly are compatible with universal retirement protection plans, Chief Secretary Carrie Lam Cheng Yuet-ngor has said. Lam praised the 2016 budget announced by Finance Secretary John Tsang Chun-wah.

Carrie Lam speaking to press after the budget announcement. Photo: screen cap LegCo.

Lam praised policies that will exempt people with elderly dependents in their families from tax and welcomed SilverBond, which will allow citizens who are 65 or older to purchase bonds which mature in three years. Tsang announced the scheme alongside iBond, which are inflation-indexed government bonds, with rates of return reportedly as high as two per cent, reported RTHK.

“This concept is [fitting] with what we’ve said in our consultation for the universal retirement protection… we still need to think of ways to make them feel at ease about their life and investment risks,” she said.

Hong Kong’s elderly population is set to rise from 15% of the population to 26% by 2029. File

“I especially welcome the increase of tax allowances for parents and grandparents, as well as those taking care of them… the government should implement measures to encourage families to look after the elderly,” Lam said.

However, in December Lam warned against adopting universal approaches for retirement protection that could benefit all elderly persons regardless of income, saying costs would be HK$2,400 billion over the coming 50 years. She also said that financial reserves may dry up as soon as 2033, eight years earlier than the last estimate, if a full pension scheme was rolled out.

Lam had then said: “The government does not itself produce money, the money to support these sorts of programmes has to come from the people. It would be irresponsible for the government not to state its position.”

Additional reporting: Karen Cheung.

Hermina Wong

Hermina is a Hong Kong writer and journalist. She graduated with a degree in politics from Cambridge, and is interested in international affairs, particularly those related to China, the EU and the Middle East. She also enjoys political satire.