Letters | Why it’s OK for Hong Kong to put HK$2 rides on hold

I refer to the proposed expansion of the HK$2 travel scheme for elderly Hongkongers to cover those aged between 60 and 64 as well. Although this scheme must be implemented, perhaps this year isn’t the right time to do so, due to the economic downturn caused by the coronavirus pandemic.

First, the scheme would put more pressure on the government’s financial position. Financial Secretary Paul Chan Mo-po in his budget speech in February said Hong Kong would record a fiscal deficit of about HK$37.8 billion (US$4.8 billion) in 2019-2020 – its first deficit in 15 years – and forecast deficits for the next five years as well. He expects the fiscal deficit for 2020-21 to be HK$139.1 billion, or 4.8 per cent of gross domestic product.

More recently, Chan has warned of Hong Kong recording its highest deficit ever amid “severe economic recession pressure”. Subsidy schemes as part of pandemic relief packages have also depleted reserves, and Chan has described the growth of government expenditure as “obviously unsustainable” from the perspective of ensuring healthy public finances and safeguarding market confidence. As the lowering of the age threshold is expected to cost about HK$1.7 billion annually, those proposing that the scheme be deferred are justified in doing so.

However, the government should implement the scheme as soon as possible once the city’s financial position stabilises. Since the price of daily necessities in Hong Kong is high, employees have to save a large amount to be able to support themselves after retirement. Therefore, the travel scheme would take a load off the shoulders of those in their pre-retirement or early retirement years. Simultaneously, the government can encourage the age group between 60 and 64 to rejoin the job market to boost the labour force participation rate.