Old age allowance

Means test may sink C.Y. Leung's plan on new allowance for the elderly

Veto likely as more legislators reject means test for new payment scheme

PUBLISHED : Thursday, 18 October, 2012, 12:00am
UPDATED : Thursday, 18 October, 2012, 3:17am

A plan to give a monthly allowance of HK$2,200 to 400,000 poor elderly people is in danger of being vetoed after Chief Executive Leung Chun-ying reiterated that he would not give in to legislators' demands to scrap or modify a means test.

Lawmakers have called for higher asset and income limits or the scrapping of the means test.

But Leung said yesterday: "I have to reiterate clearly that the administration will not cancel or amend the asset-and-income-declaration requirements and limits, and we will not withdraw the proposal either."

He said he knew legislators had different views on the means test, "but to cancel these restrictions would be irresponsible, and financially unsustainable".

Under the proposal, at least 290,000 people aged 65 to 69 who have passed a means test for the present HK$1,100 per month allowance, known as fruit money, will receive the proposed new payment from March. Those aged 70 and above, who get fruit money without a means test, must declare income and assets to be eligible for the new rate.

Assets are capped at HK$186,000 and monthly income at HK$6,600 for anyone aged 65 or above, limiting the cost to the government to HK$6.2 billion in the first year. If the test was scrapped, the cost could blow out to HK$13.6 billion, the government has said.

The pan-democratic Labour Party has called for a special session of the Legislative Council to be held, so pressure groups could air their views.

But Leung said the allowance was aimed at helping the needy and "is not the starting point for a universal pension scheme".

The chief executive's remark failed to impress the Beijing-loyalist Democratic Alliance for the Betterment and Progress of Hong Kong, which has 13 lawmakers.

DAB chairman Tam Yiu-chung said the party might abstain when the proposal was put to a vote, if the government refused to raise the asset limits.

"We are facing a dilemma, because if the allowance is delayed, the elderly might get a month's less worth of allowance," Tam said. "So we want to listen to the welfare minister on Monday, when he comes to Legco."

At least another 19 lawmakers who were previously undecided about their stance also said they were inclined to vote against the plan after Leung's address, including independent pan-democrats Charles Mok and Kenneth Leung Kai-cheong, as well as the Democratic Party (six seats), and the pro-establishment Federations of Trade Unions (six seats), and Liberal Party (five seats). They urged the government to reconsider their demands for changes to the proposal.

The administration now risks a veto of the proposal because fewer than 20 of the 70 lawmakers remain firmly in favour, including seven from the Business and Professional Alliance, four independent lawmakers and two from the New People's Party.

"We think political parties should not act like people buying vegetables from the market, bargaining for this limit and that limit," New People's Party chairwoman Regina Ip Lau Suk-yee said. "We believe that the income limit and the means test are appropriate."