HK commission to tackle poverty

Its tasks include defining poverty line and designing a social safety net

By Li Xueying, The Straits Times, 10 Nov 2012

HONG KONG - Outwardly a glitzy city of skyscrapers where bankers and property tycoons live in conspicuous consumption, Hong Kong has pockets of heart-rending poverty.

There are towns like Sham Shui Po in Kowloon, where the poor and elderly live in partitioned flats and "coffin" homes. Further north, in the New Territories, there is Tin Shui Wai, dubbed the City of Sadness for its high suicide and unemployment rates.

To root out and tackle the causes of poverty, Hong Kong - one of Asia's richest cities but also its most unequal - has established a high-level commission.

It is given the mandate of setting a poverty line - which will direct aid to those who need it, and will help design an "appropriate" social safety net. It will recommend policies to promote social mobility in this city where many are increasingly trapped in inter-generational poverty.

Also on its agenda is the controversial issue of whether Hong Kong should have a universal pension system for its elderly people.

Chief Executive Leung Chun Ying yesterday announced that he has appointed the commission for a two-year term.

It will be chaired by his No. 2, Chief Secretary Carrie Lam, while Mr Leung himself will helm annual summits "to set and reinforce strategic directions". Its 22 members hail from a surprisingly broad spectrum of society including academics, experienced activists, politicians of various stripes - and one property tycoon, Mr Henry Cheng of New World.

The commission will likely feature prominently in Mr Leung's administration, which has been beset with scandals but has drawn approval for its emphasis on livelihood matters.

It will have its work cut out.

The city's Gini coefficient - a measure of income inequality - last year yawned further to 0.537, from 0.525 in 2001 - ahead of cities like Tokyo and Singapore. Singapore's coefficient rose to 0.473 last year from 0.454 in 2001.

The average gross household income of the poorest 10 per cent of Hong Kong's population fell to HK$2,170 (S$340) last year from HK$2,590 in 2001. This is even as the richest 10 per cent got even richer, bringing home HK$137,480 a month - up from HK$122,740.

Some 1.15 million people - one-sixth of the seven million residents in Hong Kong - earn less than half the median income of HK$7,000 per person. HK$3,500 is viewed as the amount needed for daily subsistence, excluding housing.

The government has blamed the trend on economic restructuring, which has led to a "shift in demand from traditional low-skilled workers to high-skilled, high-income workers".

In May last year, it instituted a minimum wage system, mandating that low-income workers get HK$28 an hour. This is set to increase to HK$30.

But critics have also pointed fingers at the government for cosy relationships with vested interests in property, finance and business, creating an unequal field and blocking opportunities for low- and middle-income Hong Kongers.

Mr Fredrick Fung, a pan-Democrat legislative councillor who is on the commission, highlights this as a major challenge.

His hope is that one of the commission's task forces, which looks at how the government, the business sector and community organisations can work together on developing social enterprises, will help develop new sectors and opportunities for ordinary folks.

"Our economy is too much concentrated in property and finance. We need to create a multi-sector economy so that all can partake in it," he told The Straits Times.

Another commission member, Mr David Wong, permanent honorary president of the Chinese Manufacturers' Association, said one way is to look at creating jobs for the low-income where they live, so they do not have to travel too far for work and spend on transport.

The first meeting of the commission will be held next month.