Leung Chun-ying

Clash expected in Legco over means test for a new old-age allowance

PUBLISHED : Friday, 05 October, 2012, 12:00am
UPDATED : Monday, 03 October, 2016, 5:52pm

Chief Executive Leung Chun-ying says the government will stand firm on requiring a means test for a new old-age allowance, defying political parties that warn they may veto the plan if the condition is not waived.

When the Legislative Council reconvenes on Wednesday, one of Leung's first battles is likely to be the debate on a HK$2,200 a month allowance for about 400,000 elderly poor.

Parties from across the political spectrum, including the Civic Party, Democratic Party, Labour Party and the Beijing-loyalist Federation of Trade Unions, say the means test must be waived for those over 70, as for the existing elderly allowance called "fruit money". If the government dismisses this demand, it is likely that the 33 pan-democratic and FTU lawmakers in the 70-seat legislature will veto the proposal.

Leung, who will mark his 100th day in office on Monday, stressed that there was no room for concession.

"We'll stand firm [on the allowance proposal]. We'll explain to Legco … why this is in the best interest of Hong Kong … in the long term," he said.

The administration plans to seek funding approval from Legco's Finance Committee on October 26 and launch the scheme by next year.

A government source said about one-sixth of government spending, or HK$43.5 billion, went on welfare for the elderly this year, including "fruit money" and social security.

The new allowance, for people aged 65 and above, would cost HK$6 billion a year. It was one of Leung's first proposals as chief executive.

If a means test is waived, the government says it would cost an extra HK$4 billion for the allowance and the annual cost could balloon to HK$20 billion a year in 10 years as the population ages. "I see this as a matter of responsibility … to balance the needs of the elderly and the ability of the Hong Kong government to satisfy their needs," Leung said.

The administration earlier said the income and asset limits to qualify for the new allowance would be the same as the HK$1,090-a-month "fruit money" programme.

The income cap for a single person is HK$6,600 a month, with an asset limit of HK$186,000. For a married couple, the income cap is HK$10,520 a month and assets are at HK$281,000.

Meanwhile, Leung warned that Hong Kong would suffer a serious blow if mainlanders continued to feel unwelcome amid growing anti-mainland sentiment in the city. He said he was aware Hongkongers felt a growing sense of threat from mainlanders, who competed for resources such as flats, shop premises and baby milk formula.

But he said of the anti-mainland sentiment: "It will be very bad for tourism and all related service industries. It will be bad for Hong Kong employment."

Leung said certain controversial actions such as waving the colonial flag of Hong Kong in recent protests "have not gone unnoticed on the mainland".