Jake's View | Here’s why Hong Kong’s commuting subsidy will hurt the people it’s supposed to help
The Law of Unintended Consequences always applies when bureaucrats tinker with prices of goods and services in an economy. They hope to make life easier for people and they just wind up making it harder.
Hundreds of thousands of Hong Kong’s long distance bus and rail commuters will get special public transport fare discounts under a concession scheme to be outlined by Chief Executive Carrie Lam Cheng Yuet-ngor ...
Sources have confirmed the government is likely to use part of dividends from the MTR Corporation to subsidise fares for commuters taking long trips. -- SCMP, October 6
It must be déjà vu. Only six years ago, Hong Kong’s government did exactly the same under something called the Work Incentive Transport Subsidy Scheme.
The idea back then was that life was unfair for low paid workers commuting long distances from homes in places like Cheung Chau and Yuen Long. To restore fairness, the government ordained that such people earning less than HK$10,000 (US$1,280) a month were eligible for a travel subsidy of HK$600 a month.
And then, within a year, this was changed to cover all workers earning less than HK$10,000 a month, not just the ones with long commutes.
Let’s ignore for a moment that this scheme effectively creates a maximum wage limit at HK$10,000 a month – “No, boss, do not give me a 5 per cent wage increase. You’ll make me lose my 6 per cent transport subsidy.” Our big question is rather how long it will take before this latest Carrie brainwave is again extended to everyone, not just long distance commuters.