“Top up” our working poor on the lines of UK’s Working Families Tax Credits

 In Poverty, Social Assistance, Welfare & Labour
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One of the obvious necessities of foresightful thinking is a determination to break with old patterns of thought and to be willing to try out new ways of doing things. This is a principle that the Government might consider when doing its budgetary planning since it seems to be wedded to the concept of never indulging in new recurrent expenditure but only allowing itself to lash out in capital sums whether for physical infrastructure or for funds which can be spent over a period. In the era before 1997 this was a popular financial strategy since it made it less likely that over-commitment would cause some terrible crisis if revenue began to dry up.

 

A negative income-tax proposal

Sticking to this policy, however, now threatens to mire the community in a state of stasis where no real progress is made, apart from the building of roads, bridges and tunnels. Are we so timorous that we really cannot commit ourselves to moving the life of our community up a level or two so that all our fellow citizens can have a bit more day to day enjoyment of a reasonable standard of living? To take a simple example, permanently increased subvention for agencies providing services for the disabled would enable them to provide, on a long term basis, better staffing ratios and higher quality services for the clients in their care.

 

To my mind, the problem most urgently faced by the community is that of the working poor. The introduction of a minimum wage will only prevent the most egregious exploitation and will not provide those at the bottom of the social pile with an income that will have enough slack in the budget to cope with minor domestic emergencies or to access some of the facilities that this city offers for learning and pleasure which others take for granted. I believe that we need to seriously consider the introduction of a “top up” for the lowly paid, funded from General Revenue, on the lines of the UK’s Working Families Tax Credits.

 

Hong Kong to become a genuinely inclusive society

We also need to seriously examine the plight of the elderly and come up with a coherent strategy that will offer reasonable financial security in old age as well as needed facilities like residential care.

 

We should set aside a good sum of money to be made available year after year to ensure that all sectors of society can have opportunities to make full use of the West Kowloon Cultural District so that it does not become an alienating and divisive “rich man’s playground.”

 

If there is a strong desire for a “sweetener” offering immediate help to the less fortunate, I believe that the best answer is a repetition of the subsidy for electricity bills. It may legitimately be argued that this is too broad brush, helping the rich as well as the poor or even that it is environmentally unfriendly by encouraging energy consumption. Nonetheless, it certainly is a big help for all those on tight budgets and has the merit of being straightforward to administer. It is better than, say, giving an extra month’s allowance to those on CSSA which indirectly incentivizes worklessness and family breakdown.

 

There are at the same time things to which additional funding should only be allocated after close and careful consideration. One of these is university education. We should beware of going down to the path followed by places like the UK of a massive expansion in university education which eventually disillusions the “beneficiaries” as graduates find that there are insufficient high calibre jobs in the market and yet they are burdened with repayment of tuition fees. We should at the same time pay attention to the wise words of Professor Wang Gungwu, former Vice Chancellor of Hong Kong University and regard with caution over-reliance on private universities to educate our young people. Through skill, hard work and flair, some of our existing universities rank among the best in Asia and, indeed, in the world and we should not dilute the brand simply in order to increase the quantity of places “on the cheap”.

 

We also still need to solve the problem of health care financing if, as unfortunately seems possible, the present proposals to encourage more use of the private sector prove insufficiently appealing to the general public.

 

So there we have a shopping list of suggestions, both positive and negative. Everyone will have their own ideas of how they would most like to see Hong Kong improved as a result of Government expenditure. What I believe is the most important thing, though, is to break with the recent past and to demonstrate a new spirit of determination to lift our community permanently to become a genuinely more inclusive society in which there is long term better provision for the less fortunate.

 

 

Rachel Cartland (簡何巧雲)

Former Assistant Director of Social Welfare Department of HKSAR Government (香港特別行政區政府社會福利署前助理署長)

14 January 2011

 

 

 

 

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