The Corporation upheld the FAS committee'srecommendation that a "soft cap" be imposed withrespect to post-retirement health-care coverage.

Last June, the University adopted a "hard cap,"which would have held constant the dollar amountof the University's retirement health plan forpost-1995 retirees.

The "soft cap" allows the contribution to growafter 1999--but no faster than one percent belowthe inflation rate for health-care costs. A softcap thus removes the threat of inflation fromfaculty benefits, despite the lack of a guaranteedrate of increase in benefits.

Carnesale, who sits in on, but is not a votingmember of, the Corporation, said that the boardconcluded that its benefits package is bothcompetitive and fair.

"Within the Harvard community, the Corporationfeels a responsibility to be sure that people aretreated fairly," the provost said. "[TheCorporation] feels that [the changes] result in abenefits package that seemed to be fair."

Another Corporation member agreed.

"We decided for broad institutional reasons wehad to reject the report," University Treasurer D.Ronald Daniel said in an interview yesterday. "Wegot a very good report [and] we tried to respondwith equal effort."

Professor of Sociology Peter V. Marsden, chairof the FAS Committee on Benefits, refused tocomment to the press, but issued a statement withthe qualification that any further remarks wouldbe delayed until after the May 2 faculty meeting.

"The Committee appreciates the seriousattention that the Harvard Corporation has giventhe recommendation....It is pleased that themembers of the Corporation share its concern abouthow the benefits changes announced last Juneaffect plans and retirement decisions," thestatement said.

"Likewise we are glad that the Corporation hasdecided to replace the `hard cap' onpost-retirement health benefits after 1999 with a`soft-cap.'"

"Of course, the Committee felt that the groundsit set forward for rescinding the announcedreductions...were persuasive, and we are sorrythat the Corporation decided to leave thosereductions in place," the statement said.

Several other members of the committee referredall comments to Marsden.

The Corporation's report also reaches a thirdand much less controversial conclusion, astatement regarding "process, and future steps."The statement points to the recently-establishedUniversity Committee on Benefits as an appropriateforum for evaluation of the benefits process.

Carnesale, who will chair the committee, saidin a telephone interview late yesterday afternoonthat it will work largely through subcommittees.Among the issues to be covered by separatesubcommittees are those of faculty retirement,health care, administrative matters and issues ofparticular importance to the staff.

The provost said yesterday that he has alreadysolicited nominations from the deans, and thatinvitations will be issued to individuals"shortly." He said he hoped the committee couldconvene once before Commencement.