Social enterprise funds should help avoid poverty, not just alleviate it
Ming Wong says the HK$500m development fund must be for more than poverty alleviation
Noteworthy in Chief Secretary Carrie Lam Cheng Yuet-ngor's recent announcement of the re-establishment of the Commission on Poverty is the inclusion of a task force to determine the terms of reference of the previously announced HK$500 million Social Enterprise Development Fund, now called the Social Innovation and Entrepreneurship Development Fund.
Considering that Lam will chair the commission, her announcement effectively shifts control of this fund from the Home Affairs Bureau to the Office of the Chief Secretary. Equally important is the change of the fund's name to one that signals a willingness to embrace change and emphasises a new approach to solving old problems.
Together, these two actions represent important first steps towards the creation of a vibrant, innovative environment to address Hong Kong's social problems.
While Lam is to be applauded for her bold initiative, the inclusion of this fund's task force in the commission introduces a potential concern: Lam needs to be wary of deploying the money solely on measures to directly alleviate poverty.
One potential solution is to use the Community Care Fund, which is also included in the commission's remit, for this purpose while reserving the social development fund for promoting longer-term solutions.
These could include, for example, the funding of intermediary companies that train social entrepreneurs or research companies that test the feasibility of new financial instruments, like social impact bonds, to harness the power of financial markets for positive social impact.