Replies to LegCo questions

LCQ4: Measures to relieve the financial hardship of low-income earners

     Following is a question by the Fred Li and a written reply by the Secretary for Health, Welfare and Food, Dr York Chow, in the Legislative Council today (October 13):

 

     Question:

 

     According to the statistics published by the Census and Statistics Department, there were more than 182 000 households earning a monthly income less than $4,000 in the second quarter of this year, representing 8.2 per cent of the total households. Moreover, while 2.8 per cent of the male workforce earned less than $4,000 a month, the figure for female workers stood at 9.9 per cent, indicating that female workers are earning much less. Despite a 12.1 per cent growth in the economy in the second quarter of this year, there has not been a significant decrease in the number of low-income earners. Regarding measures to relieve the financial hardship of low-income earners, will the Government inform this Council whether:

 

(a)    it will formulate a comprehensive policy to eradicate poverty and, for the purpose of implementing this policy, establish a poverty line, commit more resources in this regard, as well as adopt a "people-oriented" approach in the implementing the policies;

 

(b)    it has looked into the reasons for the lower earnings of female workers, and whether it will formulate a policy to promote greater gender equality in employment; and

 

(c)    it will review the various arrangements under the existing Comprehensive Social Security Assistance Scheme (including the basic rates and various allowances), so as to ensure that low-income earners can maintain a basic standard of living?

 

     Reply:

 

     As pointed out by Hon Li, there were more than 182 000 households earning a monthly income of less than $4,000 in the second quarter of this year. As compared with the figure for the corresponding period last year, which was about 194 000, there has been a slight decrease. The number of employed persons in the second quarter of this year stood at about 3.28 million, representing an increase of roughly 84 000 persons. Of these, 64 000 of them are workers with lower skills. This shows that the benefits of the economic growth have started to benefit the general public. However, I appreciate the fact that the low-income households still have to face with all sorts of difficulties in their daily lives. I will take the initiative to understand their situations as well as listen to the views and suggestions of various organisations.

 

     As regards the questions raised by the Hon Li, my response is as follow-

 

(a) In promoting social and economic development, it is our strong belief that self-motivation is the basis for both individual and societal progress. With this in mind, I believe that the most effective way to deal with poverty is to create an enabling environment in which people are given the opportunities to make use of their strengths, participate in fair competition and improve their quality of living, while maintaining social mobility through education, training and fostering economic growth.

 

     We offer support and assistance to the socially vulnerable, especially the elders, people with disabilities and poor families. We have also put in place a social security safety net which provides people who are unable to be economically active to make ends meet with financial assistance to meet their basic and essential needs.

 

     At the same time, we encourage mutual help and cross-sectoral collaboration. We also strive to build capacity of individuals, families and local communities to help themselves and each other to tackle life problems, and cope with adversities in a more effective manner.

 

     In accordance with the above principle, the Administration has allocated substantial resources for, among others, public housing, public medical services, education, manpower training and social welfare, with a view to improving people's livelihood. In 2003-04, public spending on these fronts amounted to $126.9 billion, accounting for 57 per cent of our total recurrent public expenditure. The Administration has also provided low-income households and persons with a variety of fee remissions/reductions, such as in respect of public housing rentals, public hospital fees, school fees, and the provision of textbook assistance and travel subsidy.

 

     Regarding the question of setting a poverty line, to the best of my knowledge, neither the academic circle nor the international community has reached any consensus on the definition of poverty. Some have suggested defining poverty in relative terms while others have suggested defining it in terms of income distribution. We consider it unnecessary to set a rigid poverty line. Our view is that we should provide the needy with multi-faceted services and assistance to cater for their actual needs.

 

(a) (b) As regards the feminisation of poverty, we recognise the concerns about the greater number of women over men in the lower income groups. In 2003, amongst those employed persons having monthly employment earnings of less than $4,000 (excluding foreign domestic helpers), 61 per cent were females, slightly less than the figure of 64 per cent in 2002.

 

     To improve the livelihood of women with low income, the long-term solution lies in enhancing their employability and ability to earn higher income. To this end, the Vocational Training Council and the Employees Retraining Board have provided various subsidised programmes to help women upgrade their skills and employment opportunities. Moreover, the Women's Commission has initiated a Capacity Building Mileage Programme in collaboration with other organisations to provide radio and face-to-face courses for women's self-development and life-long education to meet challenges. To meet the needs of working mothers, a wide range of child care services are also made available to enable them to take up employment.

 

     In respect of the CSSA Scheme, as at end August 2004, women accounted for about 52 per cent of the total number of CSSA recipients. In particular, single-parent CSSA families are entitled to standard rates and special grants in recognition of the difficulties they encounter in bringing up a family. We have also put in place the Ending Exclusion Project to encourage CSSA single parents to move towards self-reliance and integrate into society.

 

(c) Regarding the CSSA Scheme, with ongoing fine-tuning, it has served us well in general for years. Certainly, the Scheme still has room for improvement in order to keep abreast with the development in society. We will review the Scheme from time to time to ensure that recipients' basic needs are met.

 

     Apart from making reference to the movement of the Social Security Assistance Index of Prices (SSAIP) when we consider the adjustment of CSSA rates annually, the Social Welfare Department is also undertaking a number of reviews and studies of the CSSA Scheme, including assessing the effectiveness of the Intensive Employment Assistance Projects and other enhanced Support for Self-reliance measures, reviewing the needs of single-parent CSSA families and the current level of assistance available to them, and revisiting the Disregarded Earnings arrangements for CSSA recipients.

 

     We understand the public concern about the CSSA policy, and are aware that a number of organisations are conducting studies of people's basic daily needs. The Administration welcomes exchanges with all interested parties at any time.  With the ageing population, we need to maintain a healthy public financial system while allocating social resources, in order to ensure that we have a sustainable social security system to take care of the public's needs.

 

     Protecting the vulnerable groups and poor families are one of my work focuses. In future I will meet with people from all sectors to hear their views, to help me formulate appropriate policies so that services and resources would be targeted at those people most in need.

 

 

Ends/Wednesday, October 13, 2004

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