Hong Kong welfare chief Law Chi-kwong says latest relief measures aimed at the elderly and low-income people will pose a burden on city’s coffers

• But he says financial pressure on the government will decrease gradually due to a slower growth of the elderly population from next decade
• Elderly Commission chairman Lam Ching-choi says the new measures reflect a change in the administration's attitude in governing following the protests

Hong Kong's welfare chief admitted on Wednesday that the latest relief measures aimed at the city's elderly and low-income groups would pose a financial burden on the government, but argued the pressure would decrease over time due to slower expected growth in the elderly population from next decade.

Secretary for Labour and Welfare Law Chi-kwong was responding to the plan to combine two old-age living allowance schemes into one subsidy worth HK$3,585 (US$461) a month, giving 50,000 recipients of the scheme an extra HK$910 per month.

About 100,000 more senior citizens are expected to become eligible for the allowance after the government raised the asset limit for the recipients to HK$500,000. The revamp will incur an additional annual expenditure of HK$5 billion.

The new initiative has been described as "close to a universal pension scheme" by a cabinet member.

It was part of a HK$10 billion-a-year, 10-measure welfare package Hong Kong leader Carrie Lam Cheng Yuet-ngor unveiled on Tuesday to ease the burden on the city's poor and elderly amid the economic downturn, which has been intensified by the civil unrest that has rocked Hong Kong since June.

Hong Kong leader Carrie Lam announces HK$10 billion welfare package

Speaking on a radio show on Tuesday morning, the minister admitted the measures would pose a burden on the government's coffers, but argued the impact would be significantly lower in the long run.

"The proportion of people receiving the old-age allowance will gradually decrease in the future as they will be protected by the Mandatory Provident Fund," said Law, referring to the compulsory pension fund introduced in 2000.

He said though the city would record an annual growth of 4.5 per cent in the population of elderly citizens in the coming decade on average, the pace would shrink to 3.5 per cent in the decade after.

Law also defended the government's U-turn to expand the fare concession scheme that will soon allow residents aged 60 and above " from the current benchmark of 65 " to travel on public transport for just HK$2 a ride.

Officials had earlier cautioned against the idea, pointing to the enormous cost the city would incur. Recently, they had also raised the age threshold for the elderly Comprehensive Social Security Assistance (CSSA) from 60 to 65, responding to the rising life expectancy and the trend of retiring at 65.

Economists take aim at Carrie Lam's HK$10 billion welfare package

But Law on Wednesday explained that more than half of the people aged between 60 and 64 were not working, while saying he believed the new scheme would encourage them to return to the job market, travel more, or work as volunteers.

However, he admitted the age threshold of welfare policies should still be increased gradually with the rising life expectancy.

Speaking on another radio programme, the Elderly Commission chairman Dr Lam Ching-choi, also an adviser to the city leader in the Executive Council, described the revamped old-age allowance scheme as already being somewhat similar to a universal pension scheme, which had been a long-standing demand of civil society.

The commission chairman also dismissed the suggestion that the government had excluded young people from the latest raft of measures.

"The measures may not seem to target young people directly, but have many of their 'footprints'. They may help narrow the wealth gap and bring about a just society " this is a way to respond to the demands and values of young people," he said.

He also said the measures had reflected a change in the administration's attitude toward governing the city in the wake of the protests, as they had been trying hard to get closer to the people.

Copyright (c) 2020. South China Morning Post Publishers Ltd. All rights reserved.