CY Leung policy address 2014

Help for poor as Chief Executive reveals HK$10b spending spree in policy address

Chief executive unveils HK$3b-a-year allowance for low-income families among raft of measures, but middle class will have to shoulder burden

PUBLISHED : Thursday, 16 January, 2014, 7:11am
UPDATED : Monday, 03 October, 2016, 5:52pm

Boosting land supply, helping the poor and enhancing Hong Kong's long-term economic competitiveness were at the core of Chief Executive Leung Chun-ying's policy address yesterday.

After criticism that his maiden speech 12 months ago boasted grand visions and slogans but little detail, Leung unveiled initiatives that will cost taxpayers more than HK$10 billion a year.

Expensive measures include the HK$3 billion-per-year Low-Income Working Family Allowance, which will benefit 710,000 people from more than 200,000 poor families.

Also, the value of health care vouchers for the elderly will be doubled to HK$2,000 per year at a cost of HK$1.1 billion.

While Leung's generosity to the working poor drew applause from advocates for the underprivileged, his policy blueprint offered little relief for the middle class, who shoulder the lion's share of the tax burden.

There were also questions about how the money for relief measures would be funded.

A government-appointed working group is warning that the city's healthy surpluses will soon be replaced by a structural deficit, with its HK$734 billion in reserves drying up in 20 years.

Ivan Choy Chi-keung, a political analyst at Chinese University, said he feared Leung's spending proposals would trigger conflict between poor and middle-class Hongkongers and lead to increased tensions between the chief executive and the rich.

"The middle class might feel that the administration is not only ignoring them, but also issuing cheques that taxpayers will pay," Choy said.

Leung told media executives after his speech that the government's big fiscal surplus would more than cover the new spending, but that the government would manage public finances prudently. The budget surplus was HK$64.8 billion last year.

Asked if he was trying to rebuild his flagging popularity with sweeteners, Leung said he would have made himself more popular if he had given cash to everyone - an apparent reference to the HK$6,000 handout to permanent residents three years ago.

"We are trying to spend the money on the needy this time, but not handing out cash to everyone," he said.

Leung added that if he had announced a handout for "political purposes", he was sure he would "get more applause".

In his speech, Leung officially endorsed the target of building 470,000 flats in the next decade, set by a high-powered government-appointed panel last year.

Leung said 80 sites would be rezoned for housing from green belt or government, institutional and community use, enough to build 89,000 flats. That meant sites had now been identified on which to build 485,000 flats. Critics said the target could slip if development was opposed by residents or district councils. A construction industry manpower shortage could also delay work.

Leung said sustained economic growth was needed to address issues such as poverty, housing and Hong Kong's ageing population. He also proposed the creation of an innovation and technology bureau, 19 months after his original plan to restructure the government - which would have included the bureau - fell victim to filibustering.

But he spoke only briefly on political reform, the subject of a five-month consultation and massive public debate ahead of the 2017 election for chief executive. Leung said the government was committed to achieving universal suffrage.

Additional reporting by Fanny W. Y. Fung


C.Y. Leung's policy address in brief

  • Rezone 80 more sites to build 89,000 flats
  • HK$3 billion a year in handouts for more than 200,000 low-income families
  • Build a 130-hectare artificial island east of Lantau
  • HK$800 million in residential care service vouchers for elderly
  • Chinese language help for ethnic minority students and school leavers
  • Set up an innovation and technology bureau
  • Allow development south of Pok Fu Lam for subsidised housing
  • Build city's first traditional Chinese medicine hospital
  • Fund colorectal cancer screening for over-50s


Main policy proposals at a glance

Welfare and poverty alleviation

  • New Low-Income Working Family Allowance. It will cost H$3 billion and help more than 200,000 families
  • Additional rent assistance for Comprehensive Social Security Assistance recipients

Elderly and children

  • About 3,000 vouchers worth HK$800 million to be issued to the elderly to help pay for care services
  • Purchase of places in Shenzhen old people's homes to ease waiting list for government-funded homes
  • Value of health care vouchers for the elderly to rise from HK$1,000 per year to HK$2,000
  • Extra 360 subsidised after-school childcare places
  • Age limit to rise from six to nine for babysitting services under the Neighbourhood Support Child Care Project
  • Disabled children to be eligible for HK$2 concessionary fares on public transport and the concessionary fare scheme for the disabled and elderly will extend to the green minibus network


  • New Chinese-language curriculum for ethnic minority children to help integration in local schools
  • A means-tested grant of HK$15,000 per year for an unlimited number of needy students studying at mainland universities from 2015-16 to 2018-19
  • Value of kindergarten vouchers to rise from HK$17,510 a year per child to HK$20,010 in the financial year 2014-15 and HK$22,510 in 2015-16
  • Additional 2,120 subsidised places for degree programmes inside or outside Hong Kong
  • HK$200 million earmarked for the Partnership Fund for the Disadvantaged to launch after-school learning programmes

Economy and labour

  • A new 130-hectare artificial island "metropolis" to be built east of Lantau
  • Creation of an Innovation and Technology Bureau
  • New body to develop value-added maritime services
  • Promotion of Hong Kong's legal and dispute resolution services
  • Four-year pilot scheme to provide allowances for apprentices in industries such as construction

Housing and land

  • Rezone 80 sites to residential use from green belt or government, institutional or community use. This will make room for 89,000 flats
  • Lift development moratorium in the southern part of Pok Fu Lam to provide 11,900 more public rental housing and Home Ownership Scheme flats
  • Two new hostels in Mong Kok and Jordan to provide temporary housing for 1,000 18- to 83-year-olds.  Develop the Northeastern New Territories and Hung Shui Kiu, extend Tung Chung New Town and convert four former agricultural sites in North District and Yuen Long to increase housing supply
  • Provide an additional 430,000 square metres of office space and 6,800 flats at Kai Tak
  • Study the potential of underground development for commercial use in Tsim Sha Tsui West, Causeway Bay, Happy Valley and Admiralty/Wan Chai


  • New HK$1 billion fund to promote recycling
  • A green station to be built in each of Hong Kong's 18 districts to collect recycling items
  • HK$1 billion earmarked to turn restored landfill sites into recreational areas
  • Faster chargers for electric vehicles to replace the 100 existing chargers
  • The chief executive and principal officials will switch to electric cars on a trial basis. About 100 more electric vehicles will be bought for government use

Health care

  • City's first traditional Chinese medicine hospital to be built in Tseung Kwan O. Integrated treatment pilot scheme to be launched in three hospitals
  • Major general hospital planned for Kai Tak development
  • Colon cancer screening for the over-50s
  • Case-management programme for patients with severe mental illness to expand to all districts
  • Permission for overseas doctors to take internship programmes at public hospitals after sitting local licensing examination