The spirit of giving

What has been done can be undone. The Community Care Fund, announced in the chief executive's policy address, has not won wide public praise; people remain suspicious about its true purpose. So, the government should ring-fence it and announce an end date to its existence.

The business sector and the government are expected to put in up to HK$5 billion each to finance the new fund. Its purpose is two-fold: first, to 'encourage' business participation in 'helping the poor' and, second, to give the money to people in need - specifically in areas 'not covered' by the publicly funded, means tested Comprehensive Social Security Assistance Scheme (CSSA).

Chief Executive Donald Tsang Yam-kuen sees the fund as 'a fresh approach to poverty alleviation'. He said it was a 'daring' initiative because it expanded the government's role from the provider of welfare to a fund-raiser and promoter of social responsibility, with the idea of promoting 'the spirit of philanthropy within the business community'.

The city's major tycoons have mostly pledged large amounts. The super rich had no choice but to cough up after Tsang made it known what was expected of them. The government is not short of money and cynics see the fund as a way for officials to ease public discontent over the widening rich-poor gap. Many believe the growing divide results from government policies that favour the rich. Thus, according to the thinking, the fund is the government's way of getting tycoons to part with substantial sums of money, to get the government back in the public's good books while dispelling notions of government-business collusion.

In other words, the fund is there to buy social harmony. Otherwise, Tsang could have said that he would appreciate fat donations to the Community Chest, established in 1968 to raise money for welfare service providers.

Alternatively, Tsang could truly have been 'daring' by coming up with ways to tax the rich more heavily. But the government probably prefers to keep taxes low and tycoons probably also prefer to make donations. After all, there are several ways in which to do so. They can make personal donations, give through their charitable foundations, or get the companies they control to donate - with the contributions being tax deductible. Thus, they can manage donations in ways that suit them.

Since the announcement of the fund in October, a committee has been appointed to work out how it should function. The first objective is to work out what to fund, identify who will receive assistance, determine the amount of help and follow up the fund-raising arrangements. An executive committee will be kept busy vetting applications.

Committee members have said the fund aims to help needy people outside the existing welfare net, such as poor elderly people who fail the CSSA means test because they still have modest savings, and the chronically ill who can't afford new drugs and can't get them through the public medical system, either. Can these deficiencies not be met through government funding?

I have one more gripe: the fund is being created as an off-balance-sheet vehicle. This means that once the Legislative Council agrees to give the government's half to the fund, it will lose budgetary oversight of the money. The government will say the fund will be audited and the accounts made available to the public but that is not the same as giving the legislature the ability to examine and question budgetary details. The government has the opportunity to put things right in the 2011 budget. It could say before the next policy address that it will conduct and release a study of welfare deficiencies and suggest how they should be publicly funded in the long term. Officials could say that the fund is a temporary measure to help meet existing deficiencies and will be wound up after the HK$10 billion is spent. For now, the fund is there to provide a temporary way - free of much bureaucratic red tape - to meet long-identified needs that have yet to be dealt with.

Christine Loh Kung-wai is chief executive of the think tank Civic Exchange