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SCMP Reporter

WITH the unemployment rate standing at a 10-year high of 3.2 per cent, one would expect the political parties to be making an issue of it in next Sunday's Legislative Council election.

  But although proposals aimed at helping the unemployed are a common feature of the parties' platforms, most are rather circumspect in addressing the subject.

  The pro-business Liberal Party has stuck to its stance of opposing the provision of unemployment benefits.

  Significantly, despite their political differences, both the Democratic Party (DP) and the pro-Beijing Democratic Alliance for the Betterment of Hong Kong (DAB) have decided against embracing the dole.

  DP vice-chairman Yeung Sum said the party did not want to make the dole an election issue because the subject had serious long-term implications that needed to be studied.

  Instead, the party calls for a relaxation of the eligibility criteria for the existing Comprehensive Social Security Assistance (CSSA) scheme so that the unemployed do not have to deplete their savings to a very low level to qualify for assistance.

  It wants the Government to raise the maximum level of realisable assets and savings permitted for CSSA individual applicants to $96,000 and to increase the level of standard benefits to $2,750 a month.

  The DAB's proposal differs from the DP's only in respect of the asset ceiling and benefit level. DAB chairman Tsang Yok-sing says the asset ceiling for individual CSSA applicants should be raised to $45,000 and the standard benefit for individuals to $2,500 a month.

  This is despite the fact that the pro-Beijing Federation of Trade Unions, a key supporter of the DAB, is strongly in favour of introducing benefits for the jobless.

  At present, a single person applying for CSSA benefits is allowed to have cash, investments, realisable assets and valuable possessions worth $26,650, while the figure for family applicants is $17,750 per head.

  The standard rate of benefits for an able-bodied adult is $1,210 and that for an elderly person and able-bodied child is $1,810. In addition, most welfare recipients are eligible for supplementary allowances to cover rent, telephone and water charges and costs of schooling for children.

  Officials privately note that the two parties, in calling for a higher level of standard payments, seem to have overlooked the fact that most welfare recipients also receive supplementary allowances, and it is not uncommon for a family of four to receive more than $10,000 a month in total benefits.

  If the level of standard benefits were to be raised as the parties propose, then a family of four could receive up to $15,000 or even more, which could have significant implications for the public purse and people's work ethic.

  Nevertheless, the proposals of the DP and DAB are conservative in terms of their insistence that recipients need to go through a means test, though under more relaxed criteria.

  The only party which has called for the introduction of a new kind of unemployment benefit outside the CSSA framework is the Association for Democracy and People's Livelihood (ADPL), which appeals mainly to the working class.

  It proposes that those who have been unemployed for more than three months should be eligible for a $3,000 monthly payment for six months, regardless of personal wealth. It says the benefits should be financed by a levy on foreign workers and from general revenue.

  To ensure the scheme will not encourage a dependency on welfare, the party says the recipients must have previously been employed for no less than two years and accept jobs offered through the Labour Department's employment service.

  It is interesting that the party has taken great pains to justify its proposal by appealing to the work ethic of Hong Kong people and their disdain for welfare dependency.

  'A characteristic of Hong Kong people is that they are hardworking. They feel ashamed . . . for not working and becoming a burden to the family,' it said.

  'People will only seek outside help as a last resort because earning one's own living is deeply ingrained in the Chinese culture.'   In trying to allay people's concern about too much welfare, the party is mindful of a view held by many Hong Kong people that generous welfare provision in some Western countries breeds laziness among the people.

  This view is most strongly held by members of the middle class, many of whom have lived in the so-called welfare states or have relatives there.

  During the debate on whether Hong Kong should adopt a pension scheme financed by a mandatory levy on all employees or a mandatory provident fund, a major concern of the pension scheme opponents was its effect on people's work ethic.

  In opting to use the existing CSSA scheme to channel help to the unemployed, the DP and DAB, which both want to appeal to voters of different socio-economic backgrounds, tread a cautious path. Perhaps they are not sure just which way the undecided voters would vote should they embrace the dole now.

  The ADPL has no such reservations, because its support comes primarily from the working class. ADPL vice-chairman Law Cheung-kwok has challenged those who fear that introducing the dole would make people lazy to come up with evidence.

  If figures on the turnover of CSSA cases are any guide, then Mr Law seems to have a point. According to the Health and Welfare Branch, the number of CSSA cases where unemployment was the reason for assistance was 3,876 at the beginning of 1994-95. During the year, there were 3,682 new applications.

  But by the end of 1994-95, the case load had only risen to 5,302 because 2,256 cases, or 58 per cent of the opening case load, were closed during the year.

  For 'low earning' cases, 94 per cent of the opening case load was closed during the year. The corresponding figure for 'single parent' cases was 34 per cent.

  The high removal rates seem to suggest that able-bodied recipients of CSSA benefits are not hooked to the scheme. The other categories of CSSA recipients have much lower removal rates because they cover mainly the old and the disabled.

  But will more people opt to stay on welfare instead of earning a living if benefits are increased? The answer from social workers is no, because able-bodied unemployed welfare recipients are required to seek work through the Labour Department.

  Moreover, they say the present CSSA eligibility criteria are too low, so that an increase in the number of cases and a drop in case load turnover rates cannot be taken to mean an increase in welfare dependency.

  With the Health and Welfare Branch undertaking a review on the CSSA scheme, a contentious debate on how the scheme's eligibility criteria should be relaxed and levels of benefits raised is looming.

  On the one hand, adjustments must meet the needs of the recipients to sustain a reasonable standard of living; on the other, the effect on the economy of any move to make more people eligible for welfare must be carefully assessed.



Debating the dole