Welfare for 'overpaid' claimants may be cut

PUBLISHED : Friday, 12 July, 2002, 12:00am
UPDATED : Friday, 12 July, 2002, 12:00am

Welfare payments may be cut next year after a government study found some families receiving handouts could afford better lifestyles than those in work, the Director of Social Welfare said yesterday.

Social Welfare Department figures reveal the average monthly CSSA payment for a family of four, including rent allowance, is $10,010. Among families who do not receive Comprehensive Social Security Assistance (CSSA), the 20 per cent who spend the least have an average monthly expenditure of just $9,490. The payment for a family of four is 1.4 times the average wage of a non-skilled worker.

Director of Social Welfare Carrie Lam Cheng Yuet-ngor said yesterday there was 'definitely no scope for any increase in the CSSA payment' and that there could be trimming.

The Government has decided to freeze the CSSA payment until March despite continuing deflation.

Mrs Lam said there was a feeling in the community that CSSA payments were too high.

'Some people are asking if the CSSA scheme fails to give incentives to people to find jobs or if it has created an over-reliance on the government,' she said.

'Some also say there are jobs available but no one is willing to take them.

'The financial difficulties facing the government are also a problem that we have to tackle.'

Figures for the financial year 1993-94 show only 12 per cent of CSSA cases involved able-bodied recipients - including single families, low-income earners and the unemployed. The ratio had jumped to 30 per cent by June this year.

Mrs Lam said even if there were cuts, it would not necessarily mean total income for CSSA recipients would be reduced because the Government would consider allowing recipients to keep more earned income.

The CSSA caseload has tripled in the past 10 years - from 72,969 cases in 1991-92 to almost 255,000 cases in June this year, providing support for 430,000 people.

Unemployment stands at a record 7.4 per cent, with more than 250,000 people out of work. Those getting CSSA unemployment benefits rose by 48 per cent, from 24,114 to 35,639 over the past year.

CSSA expenditure reached $16 billion last financial year, up 11 per cent on the year before. Welfare payments are expected to eat up eight per cent of total government expenditure this year.

According to a government document to be presented to the Legislative Council's Finance Committee today, CSSA claimants are being overpaid by 12.4 per cent, mainly because of over-adjustments and continued deflation.

The Government says it could have saved $1.3 billion between last August and March if payments had been reduced by 11.1 per cent to offset the 'over-adjustment'.

Director of the Society for Community Organisation Ho Hei-wah said CSSA cuts would only create more poverty.

'The government's logic is totally wrong. When it says the CSSA payment could be cut because it is higher than wages in the market, why doesn't it help the employees in the market first?' he said.

'Does it mean if there are people getting poor out there, we need to make more people poorer?'