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Sunday, Sep 20, 2020

Cash boost for city’s poor with new round of one-off living subsidy

Low-income households not living in public rental housing and not receiving Comprehensive Social Security Assistance will benefit from the measure.

Hong Kong leader Carrie Lam makes new round of a one-off living subsidy to help poor cope with high property prices the centrepiece of welfare measures in policy address.


Another key plank of chief executive’s strategy is an increase in the maximum rates of rent allowance for CSSA households.

A new round of a one-off living subsidy was the centrepiece of a raft of welfare measures that Hong Kong leader Carrie Lam Cheng Yuet-ngor unveiled in her third policy address aimed mainly at helping the city’s poor cope with high property prices.

Lam made the key spending commitment for low-income households not living in public rental housing and not receiving Comprehensive Social Security Assistance (CSSA), in addition to the first round of the subsidy announced by Financial Secretary Paul Chan Mo-po in August.

Hongkongers wait on average for 5.4 years for a public flat, exceeding the government target of three years, and often end up paying a fortune in the private rental market. In August, Chan announced a one-off living subsidy for the low-income group costing HK$1 billion (US$128.2 million) and benefiting an estimated 100,000 households. It will open for applications in July next year.

A government source told the Post on Wednesday the Community Care Fund would roll out the new scheme in 2021 and its task force would set out the precise amount of the subsidy later, and complete a study on implementing a regularised cash allowance scheme by the end of 2020.

“Recipients will have extra cash in their pocket, which some will use to pay for their highest cost of living – rent. So it will go some way to meeting their financial needs in trying to afford a place to live,” the source said.

Social welfare concern groups welcomed the cash boost, but said it was “too little, too late”, falling short of what was needed.

“Landlords will be able to capitalise on a large chunk of the new cash, since they know the sums handed out by the government and know tenants can afford to pay more now. Only rent control can tackle the problem at its root,” Society for Community Organisation community officer Ng Wai-tung said.

In a press conference, Lam admitted the government had made a U-turn from its past stance on a rental subsidy with the expanded one-off measure. “Many officials, including me, have argued against a rental subsidy, saying it will be landlords, not tenants, who will benefit, and subsidies may lead to landlords being more selective and, in turn, a lower supply of rentable homes,” she said.

“But the reality we’re facing is many people are queuing up for public housing … we need to free ourselves from ingrained bureaucratic thinking – although to this day we are not yet able to come up with a well thought-out proposal for a rental subsidy as a regular policy.”

Another key plank of Lam’s rent relief strategy announced on Wednesday was an increase in the maximum rates of rent allowance for CSSA households ranging between 3 and 27 per cent according to the size of the recipient’s household.

A one-person CSSA household can currently claim up to HK$1,885 for rent allowance, which will rise by 27 per cent to about HK$2,400 under the new plan, while a two-people household is entitled to a maximum allowance of HK$3,795 now, but the cap will be lifted to about HK$4,200.

The plan will be tabled to a Legislative Council subcommittee by the end of this year, and to Legco’s Finance Committee by February next year. It is expected to come into effect by mid 2020.

Lam also proposed higher social security provisions to alleviate poverty and get more Hongkongers into work. She suggested raising the working-hour linked household allowance of the Working Family Allowance scheme by 16.7 per cent to 25 per cent, and raising the child allowance by 40 per cent.

Sanyo Ng Shan-yiu, spokeswoman of the concern group Alliance for Social Protection of Low Income Families, said the government needed to tackle the scheme’s structural problems first.

“Recipients of the scheme rose from 27,600 households in 2018 to 45,500 in 2019, but it’s still a long way off the intended target of 200,000. This is down to overcomplicated application procedures, and [workers with] many small part-time jobs.”

Another initiative was raising the maximum amount of disregarded earnings by 60 per cent from HK$2,500 to HK$4,000 per month, meaning grass-roots CSSA recipients could keep more of what they earned, and more of their salaries would not be counted when calculating the benefit payments to individuals.

A spokesman for the Labour and Welfare Bureau said: “We will also extend a range of supplements and special grants to eligible non-elderly, able-bodied Hongkongers, such as dental, eyeglasses and childcare support. We believe with this extra help, adult Hongkongers can be encouraged to seek work and increase their employability.”

Lam’s basket of welfare measures also include 3,000 additional service places for children with special needs such as speech and autism therapies, under on-site preschool rehabilitation services, to be increased over three years until the 2022-23 school year.

On labour rights protection, Lam will introduce a three-year pilot work injury rehabilitation programme starting with the construction industry. The Occupational Safety and Health Council will be given new powers to administer the scheme, which will be available to construction workers getting physiotherapy, occupational therapy and orthopaedics, who have taken six or more weeks of leave because of work injuries.

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