Hong Kong’s richest earn 29 times of what poorest get paid despite government efforts to fight poverty: report

The city also sees number of low-income households growing, Oxfam Hong Kong says

PUBLISHED : Tuesday, 11 October, 2016, 6:12pm
UPDATED : Tuesday, 11 October, 2016, 11:13pm

The number of poor households in Hong Kong is on the rise, with the richest in the city now earning about 29 times what the poorest get despite efforts by the government to help the impoverished, the latest poverty report by aid agency Oxfam has found.

The Hong Kong Poverty Report 2011-2015, released by Oxfam Hong Kong yesterday, was based on the General Household Survey conducted by the Census and Statistics Department. It came just days ahead of the annual Commission on Poverty summit this Saturday.

The 2015 figures showed a further worsening of the income gap, as the richest 10 per cent – with a HK$100,000 median monthly income – earned 28.6 times what the poorest 10 per cent got, compared with 26 times and 26.4 times in 2013 and 2014 respectively.

The number of low-income households also jumped by 1.7 per cent from 454,100 in 2014 to 461,900 last year, despite a dip in the number of people in poverty – down 6,600 to 1.15 million last year. There were 1.13 million of people in poverty in 2011.

The low-income group did not benefit from economic development as any gain in their salaries resulting from the rise in minimum wage would have been cancelled out by inflation, Oxfam argued, saying the purchasing power of the current minimum wage of HK$32.5 was equivalent to only HK$26 back in 2010.

“There is a slight drop [in the poverty population] every time after the adjustment of minimum wage, but the market is quick to adapt to it,” Wong Shek-hung, Oxfam’s Hong Kong programme manager, said.

The study also found the old age living allowance, introduced by the government in 2013, had failed to improve the plight of the elderly, with 332,800 people aged 65 and above, or one in every three in the age group, living in poverty.

Alleviating poverty was one of the key agendas on the 2012 election manifesto of Chief Executive Leung Chun-ying, who is expected to seek a second term next year.

When asked about the current administration’s performance, Kalina Tsang Ka-wai, who heads Oxfam’s operations in Hong Kong, said there was room for improvement. “I hope the incumbent administration could make use of its last year to fulfil the promises it made ... the effort now is not strong enough,” she said.

The group urged the government to review the minimum wage annually – instead of every two years – to keep up with inflation, as well as take the lead in negotiating with the business community to scrap the Mandatory Provident Fund offsetting mechanism. “The business sector should take a bigger responsibility in solving the poverty problem,” Wong said. “It would be just and fair for the low-income workers only if their hard work paid off.”

But Dr Law Chi-kwong, a Commission on Poverty member, questioned the report’s accuracy, saying statistics derived from the census failed to reflect the impact of government intervention in the form of subsidies and allowances.

He said the income disparity as suggested by Oxfam was “very much” affected by an ageing society. “The poorest 10 per cent are usually the elderly who have little or no income. I can foresee the problem worsening in the coming 20 years or more,” Law said.

A single mother of two, surnamed Chan, who recently moved out to avoid abuse by her then husband, is applying for a HK$600 subsidy through the Society for Community Organisation to buy a fan and a rice cooker.

Chan, who survives on a HK$8,300 monthly welfare payment, refused to apply for the govern­ment’s emergency relief fund, citing the high threshold and long application procedures. She urged the government to exempt expenses on basic necessities when adjusting the poverty line in future.