A Touch of Class

More than 30 years ago, two European countries with a history as colonial powers were planning their retreat from Asia. A discussion of the different approaches they adopted would normally be of interest only to historians, but some of the decisions by one of them are still having serious consequences today.

For example, the recent hoo-ha over the ability of BN(O) passport holders to claim their MPF savings early is a direct result of the United Kingdom’s decisions over many years about what constitutes British Nationality and who is entitled to it.

But before we delve too deeply into the British system, let us take as our lodestar Portugal’s handling of Macau. It was easy to persuade Lisbon to cease administering the territory: the Portuguese government had in fact on two previous occasions (1966 and 1974) already tried to hand the city back to China without fuss. So the preparatory discussions went smoothly as did the formal handover in 1999. But before leaving, as a mark of respect for their centuries in charge, Portugal offered every Macau citizen who wanted one a full Portuguese, and therefore EU, passport. This honourable gesture immediately produced some anomalies. Macau citizens could go to live and work in the UK, and their children qualified for home student status so paid lower fees at British universities. Hong Kong “British” citizens, on the other hand, could not freely emigrate there, and their children had to pay the higher fees charged to foreign students.

The British approach was completely different. For most of the two years China and UK spent negotiating Hong Kong’s return, Britain tried hard to retain a role in the territory’s future governance. Only when Beijing made clear this was a complete non-starter did serious talks begin. Moreover, as far back as 1981 Britain began making changes to its nationality laws to ensure there would not be a mass exodus from Hong Kong to the “mother” country either in 1997 or in the event of any emergency. Prior to that time, British citizens could travel freely to the different British territories. A Hong Kong British passport holder could easily migrate to the UK in the 1950s and 60s to live and work there (as many Hongkongers, including my stepfather, did), while a Brit arriving here was immediately free to work without a special visa (as I did). The introduction of British Dependent Territory passports curtailed this freedom, henceforth your “British” passport only gave the right to reside in the particular territory which issued it. This arrangement grew into the infamous British Nationality (Overseas) status. You were not British, and the Hong Kong passport gave you no right of abode here or anywhere else.

Although in theory the new restrictions applied in all British territories, including the predominantly white Falkland Islands and Gibraltar, after 1997 their citizens previous privileges were quietly restored. Thus the real target had been Hongkongers all along.

Instead of a comprehensive safety net, in the run-up to 1997 the British introduced a special scheme for Hong Kong whereby 50,000 heads of household, and their dependents, (total estimated number of beneficiaries 150,000) would be given full British Nationality, upon application and after case-by-case vetting by a committee. Some Hongkongers did qualify via this route, though many applications failed, including some from locally engaged military personnel who had paid British taxes during their employment here.

There have been further developments in more recent times. Specifically, after enactment of the National Security Law, Britain felt obliged to make a further gesture. It still could not bring itself to adopt the Portuguese model, instead offering BN(O) passport holders the right to enter the UK and stay there on condition they were entirely self-supporting and placed no burden on public finances. Various fees were also payable. After six years they could apply to convert their stay into right of abode and after a further year full British Nationality. No justification has ever been offered for this long pre-qualification period. It derives entirely from internal British political calculations. If only they were Ukrainians!

It is only after travelling this long route that we can examine the current MPF situation in its full context. The MPF scheme is basically simple: the employer and employee each pay in every month until the employee reaches the age of 65. Then he can draw on the accumulated funds. Application can be made for early withdrawal upon permanent departure from Hong Kong. Where the applicant has already secured right of abode in another country, or the circumstances of his visa are such that grant of such a right on arrival is automatic and guaranteed, then early withdrawal is routinely approved.

Beneficiaries of the latest BNO scheme have recently launched a campaign to argue that the same right should be accorded to them. The UK-based organization Hong Kong Watch has issued various statements to the international media supporting the idea. The Financial Times article, for example, is headlined “Hong Kong imposes pensions block on emigrants to Britain”. That article, and a similar one in another newspaper, imply the pensions are somehow at risk. But this is not true. When the individuals concerned reach the age of 65, or when they secure right of abode in the UK, the payments will be made. The BNO scheme as promulgated does not secure that right. Individuals could fail to reach the full seven years qualification or their applications could be rejected. Think it couldn’t happen? In the 1990s one of my tasks in the government was to deal with the fallout from just such a rejection.

Unstated by Hong Kong Watch is the undeniable truth that the British government could solve the problem at a stroke by converting all the BNO cases to full British Nationality.