Hong Kong's state-funded pension scheme

Hong Kong government likely to opt for means-tested pension scheme

Sources say administration likely to add further tier to existing schemes; various groups are expected to be angry about the move

PUBLISHED : Monday, 20 June, 2016, 11:12pm
UPDATED : Monday, 20 June, 2016, 11:18pm

Another means-tested scheme to hand out cash to eligible elderly residents would be the likely outcome of a six-month public consultation exercise on retirement protection, instead of a comprehensive universal plan backed by various groups, sources close to the government revealed.

The Post has learned that the government is considering adding another “tier” to current schemes as the answer to calls for better retirement protection for elderly Hongkongers.

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Sources said the government would possibly set an individual asset limit of between HK$80,000 and HK$140,000 for the new scheme, which will give eligible elderly people HK$3,230 a month.

The administration’s preference for a non-inclusive, means-tested proposal will come as a disappointment, especially for many of the city’s one million elderly people.

“I don’t quite understand why for a few hundred dollars, the government makes us [old people] jump through hoops,” said Wong Siu-ying, 87, who spoke to the Post during her 17-hour shift as a cleaner.

The octogenarian, who gave up her job giving out flyers on the streets when her legs became weak, now does cleaning jobs at AsiaWorld-Expo whenever she can because she “cannot afford to not work”.

Former clothes maker Kwok Chih-yin, 86, criticised a means-tested retirement plan, saying it would bring only discord among the elderly.

The debate over retirement protection has been heated. Various grass-root groups and academics suggested alternative funding options for a universal pension after Chief Executive Leung Chun-ying vowed to tackle the issue.

However, the administration dismissed a universal plan as “financially unfeasible” and an unwise use of resources.

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Chief Secretary Carrie Lam Cheng Yuet-ngor even had a public falling out with social policy expert Professor Nelson Chow Wing-sun, who completed a government-commissioned, year-long report on the topic in 2014, only to have it brushed aside. Chow had originally recommended a universal scheme.

Over 180 prominent social policy scholars presented their own consultation results to the Legislative Council on Monday. Over 70 representatives voiced their views at the special meeting, mostly backing a universal scheme.

Thousands of people took to the streets on a very hot Father’s Day on Sunday to push for a universal, non-means tested retirement plan.

Chinese University assistant professor Raees Baig said the government should lower the bar for the Old Age Living Allowance, ­instead of setting up something completely new. “The benefit of such a scheme is very small.”

The existing Old Age Allowance provides HK$1,290 a month to all Hongkongers above the age of 70. The other schemes are means-tested. The Old Age Living Allowance provides HK$2,495 with an asset limit of HK$219,000 and Comprehensive Social Security Assistance has an asset limit of HK$45,500 for a single person.

The government had received over 1,000 submissions, Welfare Secretary Matthew Cheung Kin-chung said on Saturday.