CY Leung policy address 2014

Middle-class backlash over cash for poor 'could stop budget sweeteners'

Anger over billions to be spent on poor could let Tsang ditch budget relief measures, says source

PUBLISHED : Tuesday, 21 January, 2014, 4:45am
UPDATED : Tuesday, 21 January, 2014, 7:38am

A backlash against the billions of dollars spent on the poor in the policy address means the government will be able to avoid handing out sweeteners in next month's budget, a government source says.

Chief Executive Leung Chun-ying was accused of neglecting the middle class in his blueprint last week while promising more than HK$10 billion a year on initiatives for the underprivileged.

"[Financial secretary John] Tsang Chun-wah has all along disagreed with handing out too many one-off sweeteners to the poor in his budget … but it was very difficult for him to cut these initiatives as the government had been doing it every year," said a source close to Tsang.

"The government has noticed the recent anger of the middle-class as they regard the policy address has only taken care of the poor. Unlike in the past, the social sentiment has in fact created a window for us to cut the one-off initiatives this year."

In recent years the administration has adopted several budget relief measures to help the grass roots, including paying two months' rent for public housing tenants, providing an extra allowance to people on social security and electricity subsidies to all households.

But while the government wanted to cut such sweeteners, more attention would be paid to alleviating pressure on the middle class, the Post has learned.

Economist Dr Andy Kwan Cheuk-chiu said he was in favour of dispensing with sweeteners as he doubted their effectiveness.

"Paying rents for public housing tenants, for example, might not be really helpful in assisting the poor as some of the beneficiaries might actually be quite well off," he said, adding that resources should be allocated to the needy in a more targeted way.

However, Wong Kwok-kin, of the Federation of Trade Unions, said the government should not get rid of one-off handouts "all of a sudden". "Hongkongers are used to the relief measures which Tsang has offered almost every year. A sudden halt of them might spark public outcry - especially then the government will probably still record a decent surplus this year," the lawmaker said.

If he was given a choice, scrapping the electricity subsidy would have the least impact, he said. "The subsidy isn't any great amount and every household is entitled to it. I don't think every recipient really needs it."

Labour Party leader Lee Cheuk-yan said the administration should not take advantage of middle-class anger to shed its responsibility for the grass roots.

"We oppose the one-off sweeteners, especially handing out cash to all, but the administration should also relieve the pressure on the poor if they have an excessive surplus," he said.

Separately, former executive councillor Franklin Lam Fan-keung rejected suggestions that the city was facing a welfare crisis.

He said the HK$10 billion a year spending unveiled in the policy address was small compared with the HK$200 billion one-off handouts from the government in the past five years.

"It [the HK$200 billion] is equivalent to the cost of building 20 Hong Kong University of Science and Technology or five Queen Mary hospitals."

But he agreed that Hong Kong would face its biggest economic problem in the next 10 to 20 years due to the ageing population.



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21 Jan 2014
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