Opinion | The missing debate on universal pension

There are many reasons why the filibuster by some legislators over the 2013 budget was a very bad idea, but the most important one is that it brought into disrepute the very policy they claimed to be fighting for: a universal pension.

There are two key issues the community needs to debate: whether a universal pension is affordable, and whether it is the right thing to do in principle.

These are the things we should be talking about, not whether the government will grind to a halt if the budget is not approved in the next few days (it won't) or whether there is scope to trim the expenditure of some departments (there probably is, but a few hours' debate is not going to find it).

Let us assess affordability first, because some people who oppose a scheme in principle hide behind the alleged lack of money. Start by assuming that the general retirement age should be raised to 65 as quickly as reasonably possible. Then take it that the existing fruit money plus personal savings and family support can take our elders through to their 70th birthday. So, our universal pension scheme kicks in when a permanent resident reaches 70.

Next, we need to select an amount which should just about cover essentials. I'm going with HK$6,000 per month.

Extrapolating from the 2008 census data, there are about 780,000 people who the new pensions authority would need to pay out to; let's say 800,000 to allow a margin for error.

A back-of-the-envelope calculation suggests we are looking for HK$4.8 billion per month or almost HK$58 billion a year. These are very large sums indeed. Where are we going to find them?