Letters | In helping Hong Kong’s low-income households, watch unintended effects

Readers discuss the link between affordable housing and employment, the safety of illegal building works at Redhill Peninsula, and why Hong Kong needs more young people in the public sector

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A view of public housing at Cheung Sha Wan. In providing affordable housing for lower-income families, it is important for policymakers to consider the potential unintended consequences of certain measures. Photo: Sam Tsang

Published: 11:30am, 24 Oct 2023

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In addressing the issue of affordable housing for low-income families in Hong Kong, some government measures may have unintended consequences. Recent research shows the measures could have reduced incentive for members of low-income households to participate in the labour force and increased their dependence on welfare.

According to a research report published by the Legislative Council, the average monthly public housing benefits increased significantly, from HK$240 in 2006 to HK$1,060 in 2021. In the same period, the median monthly rent for private housing also increased, from HK$5,500 to HK$12,000, according to census data. However, as only the low-income families living in public rental units get housing benefits, this means that those families ineligible or waiting for public housing have had to endure private rent increases and higher rent-to-income ratios.

Meanwhile, the report suggests that government measures may have led to lower workforce participation among low-income households, as they may choose to rely on benefits rather than seek employment.

The report reckons that the growth in non-labour income among low-income households has been primarily driven by government benefits, rather than wage growth. These findings merit policy attention.

To address these issues, the government may need to consider implementing policies that encourage members of low-income households to participate in the workforce, such as by providing job training and education, increasing the minimum wage, and improving access to childcare and healthcare.