The number of poor in one of Asia's richest cities is rising - and it calls for fast action
By Li Xueying, The Straits Times, 2 Dec 2012
In two months, Hong Kongers, like Chinese all over the world, will celebrate the Chinese New Year. Some, however, will be hiding in squalid homes to avoid bumping into neighbours' children as they cannot afford to give out red packets.
These are Hong Kong's "relative poor", who "cannot share in the life of most of society", as Oxfam Hong Kong director-general Stephen Fisher puts it.
Then there are those whom social work expert Nelson Chow Wing Sun calls the "new generation of poor" - young graduates stuck in dead-end jobs. "They are the most frustrated, who see no hope in the future," says the chair professor of social work and social administration at Hong Kong University.
At 12, Tso Ching Ting, the daughter of an unemployed immigrant from Hunan, dreams of going to Hong Kong University and studying Chinese history. But in the next breath, the girl with the jaunty ponytail says with breezy defeatism she is unlikely to make it - "because we don't have enough money".
Ching Ting, her fate already seemingly scripted, represents Hong Kong's "future poor" - the result of inter-generational poverty.
These three groups need help, say experts, as Hong Kong gets down to the business of addressing spreading poverty, a record income gap and stagnating social mobility.
Last month, Chief Executive Leung Chun Ying announced the establishment of a Commission of Poverty to determine and tackle the root causes of poverty.
It may seem an anomaly in one of Asia's wealthiest economies. Indeed, in Hong Kong, where there is a basic social safety net - handouts, free public education and health care for the needy, no one is "dying of starvation", as Dr Fisher puts it.
Even the homeless sleeping in parks and under bridges - 414 people, by the government's count in May last year - often do so by choice, not wanting to move to public housing in remote parts of the New Territories.
There is no official poverty line here. But a commonly used definition by the Organisation for Economic Cooperation and Development is when a household earns less than half the population's median income. By this, there are now 1.18 million poor people in the seven-million population, earning HK$3,500 (S$550) a month and less, up from 1.13 million in 2003.
The median monthly household income of the poorest 10 per cent has stagnated at HK$3,000. By contrast, the richest 10 per cent hauled home HK$82,700 a month last year up from HK$70,000 a decade ago.
Cast around for a reason, and Hong Kong's powerful businesses emerge as a big target. Mr Bernard Chan, an executive councillor advising Mr Leung and a businessman himself, says: "The business sector is one of the culprits."
While recent policies - such as a minimum wage - have boosted the welfare of the poorest workers, low pay and long hours remain even as the cost of living continues to rise.
But a more fundamental cause is the changing structure of the economy. Starting in the 1980s, manufacturers began shifting their factories to the mainland. The blue-collar workers, previously mechanics and factory supervisors, had to start from the bottom again as cleaners and couriers, says Dr Fisher.
Meanwhile, many young people feel shut out of an insufficiently diversified economy that is dominated by real estate and finance, says legislator Charles Mok. The two account for 27 per cent of gross domestic product in 2010; manufacturing, a paltry 1.7 per cent. Even in the the import-export trade, which makes up 24 per cent, opportunities are difficult to come by due to the need for a network and capital, says Mr Chan.
What this means is that there are jobs - the unemployment rate, at 3.4 per cent, is low. But there is a "structural mismatch - plenty of jobs but at the low-end", says Prof Chow. Over the past five years, 27 per cent of each cohort went to university; some end up working as property or travel agents. The median monthly salary for graduates of Hong Kong's top university - the Hong Kong University - fell from HK$14,521 in 1997 to HK$13,500.
While these trends have been ongoing for decades, the problems have come home to roost in recent years.
One reason is the fast-ageing population. The economically inactive aged 65 and above grew 26.3 per cent in the last 10 years. Yet, many do not have enough savings - the Mandatory Provident Fund (MPF) was set up only in 2000 and is riddled with inefficiencies - and old folk pushing trolleys of cardboard for recycling are a heartbreakingly common sight in Central.
A second reason is the swelling ranks of the young and hungry from the mainland, competing for limited top-end work. Mr Chan recounts how investment bank Goldman Sachs, with its regional HQ here, looks for talent with Mandarin ability "and that screens out locals".
Looking ahead, the city's education system as well as its urban planning are creating potential poverty traps, warn the experts.
With the causes of poverty being so multi-faceted and traced to policy flaws in various areas, it is clear that the poverty commission has a tough task ahead.
Reflecting the complexity of the issue, fights over how far social transfers should go have already erupted - the Legislative Council is now mired in filibuster sessions over whether a new old-age allowance should be means tested. It is a harbinger of what is to come for an even more controversial topic: Should Hong Kong have a universal pension system?
As Prof Chow asks, where will the money come from? The former chairman of the MPF advisory committee does not think Hong Kong should have one, suggesting the government improve on its current system of handouts. What is of greater need, he reckons, is a medical insurance system by getting people to pool 2 per cent of their incomes - the public hospitals, he says, are on the "edge of breaking down".
Dr Fisher disagrees, saying that a mandatory pension system - to make it sustainable - will help redistribute incomes. Instead, the MPF system, which is "not working", should be scrapped.
What is clear is that there will be "a lot of political fighting" over the way ahead, as Dr Fisher anticipates.
But whatever transpires, Hong Kongers are hopeful that the conversation has at least started. And it will come none too soon for the city's poor.
HK'S CITY OF SADNESS
In 2004, an unemployed man hacked his wife and twin daughters to death before ending his own life.
The tragedy inspired the label "City of Sadness" for the remote estate Tin Shui Wai in north New Territories where the family lived, as well as an award-winning movie Night and Fog by filmmaker Ann Hui, starring Simon Yam as the lead character.
It was hardly the first or the last tragedy to plague Tin Shui Wai, which means "the town of sky and water" but which has become a vivid symbol of poverty and violent crime in Hong Kong.
In 2007, a woman threw her two children from their flat on the 24th floor before leaping to her death. Over the past two months alone, two groups were wounded by chopper-wielding attackers.
In this isolated satellite town, emotions run high. Some 60 per cent of its 300,000 residents live in public housing. Many are unemployed. Job opportunities are curtailed, given that a round-trip bus ride to Central takes three hours and costs HK$42.80 (S$6.80).
Tin Shui Wai is a result of a failure in long-term urban planning, say experts. Hong Kong is in danger of creating segregated ghettos, with the rich living on Hong Kong Island where the city centre is, the middle class on Kowloon, while the poor are packed off to remote parts in the New Territories, says Professor Nelson Chow, the chair professor of social work and social administration at Hong Kong University.
Fishing for success in bid to lick poverty
By Li Xueying, The Straits Times, 2 Dec 2012
The group of children play around the headmaster's office, waiting for Mr Leung Kee Cheong.
Eight-year-old Carman Luk sits quietly, hugging a used electric kettle she retrieved from a box. It is her reward for scoring full marks in dictation.
In a nearby classroom, a metal bowl filled with packs of meatballs that expire on Dec 3 sits by the door; children grab a couple each to take home as they leave.
Here at the Fresh Fish Traders' School in Tai Kok Tsui, a low-income estate in Kowloon, 70 per cent of the 230 pupils are from families on the dole. About half are children of new immigrants from the mainland.
Licking inter-generational poverty here is an uphill mission. Only three out of about 500 of its pupils the past decade eventually made it to university. The majority, says Mr Leung, end up as drivers or cooks.
Mr Ho Hei Wah, director of advocacy group Society for Community Organisation, says that an increasingly segregated education system, meant to inject competition, is instead creating a stratified system where poor kids go to poor-performing schools and the rich, to better-resourced ones.
He singles out the Direct Subsidy Scheme (DSS). Established in 1991, it converted high-performing government schools providing free education into semi-autonomous institutions free to set their own curriculum and fees - which can go up to HK$5,000 (S$787) a month.
While the 87 DSS schools - about 10 per cent of government schools - are supposed to reserve at least 10 per cent of their fee income for waivers or scholarships for poor students, a government audit in 2010 found that one-third did not comply.
Dr Stephen Fisher, director-general of Oxfam Hong Kong and formerly director of social welfare, charges: "In the past, poor kids could still make it to elite schools but now more are shut out."
He acknowledges that the government does provide decent infrastructure to other schools catering to poor children, but the software is lacking.
"Once you are inside, the environment is different," he says. "Most times, the principal and teachers don't want to be there; the kids themselves have low expectations. It's a vicious cycle, and very few succeed."
At the Fresh Fish Traders' School, the headmaster and 18 teachers strive to beat the odds with their pupils.
Says Mr Leung, 57, himself the son of odd-job workers: "We want them to enjoy studying, to love doing homework. If they get high marks, they get praise and rewards.
"This way, we hope to help the kids change their mindsets, and hopefully they won't follow in the footsteps of their parents and have to depend on welfare."
To do so, he uses carrots - sometimes literally. Children who hand in their homework on time for a week get two cans of food and a small bag of rice. During the mid-autumn festival, they take home mooncakes.
The gifts are from merchants who give expiring food, hotels that donate second-hand items like kettles or companies that fund extra-curricular activities - even overseas trips.
Madam Cao Juwen, 43, the jobless mother of a pupil there, says: "When we miss out on the food, we get very upset! So I try to make sure my daughter does her homework."
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