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Poverty

Hong Kong’s next leader must strive for a fairer society by fixing the social safety net

Kalina Tsang calls on the next chief executive to get to grips with a widening rich-poor divide, and improve policies to help the working poor in particular

PUBLISHED : Sunday, 26 February, 2017, 7:03am
UPDATED : Sunday, 26 February, 2017, 7:26pm

Eight – just eight – men own as much as the poorest half of the world, according to Oxfam’s latest inequality report, “An economy for the 99 per cent”. It details how big businesses led by the super-rich are pursuing profits at all costs by dodging taxes, driving down wages and cutting prices paid to producers.

Hong Kong is a microcosm of the grossly unequal reality we see globally, with the richest 10 per cent of the city’s households earning 29 times more than the poorest 10 per cent. This inequality has only exacerbated the poverty here, which needs to be tackled with urgency, especially by our next chief executive.

Election candidates hope to tackle, among other things, our divided society. Talk of “divisions” often conjures up associations with political division, but our society is just as divided economically and socially. Cracks in policies have fuelled an economy that excessively rewards the privileged few and disregards the needs of the people – a system that’s both unjust and unsustainable.

Hong Kong’s appalling wealth gap is a burning fuse for revolution

A just society should ensure the poor have the right to lead a dignified life. The growth of the economy or any profit-making endeavour shouldn’t come at the cost of livelihoods. And while Hong Kong’s total wealth has increased, close to 1 million people live below the poverty line – half of whom live in working-poor households.

Cracks in policies have fuelled an economy that excessively rewards the privileged few and disregards the needs of the people

Although the government has rolled out various poverty alleviation measures over the past five years, there’s a desperate need for improvement. For instance, to protect low-income workers, the government introduced a minimum wage in 2011. Since then, increases have lagged behind inflation and so the purchasing power of the current wage level – HK$32.50 – is equivalent to HK$26 in 2010, which is even lower than the wage level of HK$28 set then. And while the Low-income Working Family Allowance was implemented last year, stumbling blocks remain.

One of the government’s notable achievements, however, is the establishment of the poverty line – currently set at half the median income for a given household size.

As welcome as such a move is, the calculation method for the poverty threshold has inherent flaws. A 2014 Oxfam study on the basic cost of living found that the poverty line underestimates the poverty threshold for one- and two-person households.

Redirect Hong Kong’s welfare spending to reach its most needy

Over the past five years, the gap between the rich and the poor has widened with alarming speed and at a rate far faster than policies are being implemented. We can and should do better.

The next chief executive must put people first and tackle these systemic problems if we’re to see any change.

Kalina Tsang is head of Oxfam’s Hong Kong, Macau, Taiwan programme