Hong Kong’s welfare chief has defended the government’s decision to scrap a basic income the poverty linewhile lawmakers question how authorities will assess the city’s poverty levels going forward.
Addressing the Legislative Council Panel on Welfare Services on Monday, Labor and Welfare Secretary Chris Sun said the old poverty standard failed to objectively reflect the situation in Hong Kong and could not accurately address the difficulties faced by vulnerable groups.
Before the change, households making less than 50 percent of the median monthly household income before taxes and welfare were considered to be living in poverty.
“We cannot look only at economic factors and rely on means from public funds. We need a more comprehensive support system and a tighter welfare network,” he said.
The government should provide welfare, health care, education and public housing, providing targeted assistance measures such as community living rooms, after-school care services and Strive and Rise program, he added.
The labor minister’s comments came as the government moved to scrap an income-based poverty line in favor of a new “targeted” approach to poverty alleviation.
The government published a REPORT last month outlining a framework of 21 indicators to identify the three main vulnerable groups, including elderly households, single-parent households and tenants in shared housing.
It does not put forward a new official definition of poverty.
A study presented at the University of Hong Kong last month found that Hong Kong is among the most unequal societies in terms of wealth distribution. Yang Li, a senior researcher at Germany-based ZEW-Leibniz Center for European Economic Research, examined data from 1981 and 2021. He found that, by 2018, at least 10.3 percent of Hong Kong’s total private wealth was controlled by the richest 0.001 percent of the population, which was 2021. according to to SCMP.
Legislator’s concern
In the legislature, lawmakers Cheung Pui-kong and Chan Pui-leung asked how the government would monitor the poverty rate on a macroeconomic scale after the poverty line is abolished.
Sun said, “Let’s say you calculated the poverty line based on income. If you want to know where those people are living in poverty, this line can’t tell you that,” adding that many other governments don’t use an income-based poverty line.
Lawmaker Chau Siu-chung asked whether the government would address issues beyond the three target demographics, including youth poverty. He cited a 2020 report that said a third of those living in poverty were between the ages of 25 and 29, including half who had a post-secondary education.
Sun said the lack of opportunities for young people was not a matter of poverty. “This is about how society as a whole can create more opportunities for young people for upward mobility,” he said in Chinese.
Authorities stopped publishing annual poverty figures in 2022 after the current administration took office, years before the new report was due.
The government said in a legislative document that determining poverty as a percentage of the average family income “could neither fully (or) accurately reflect the true picture of poverty nor adequately assess the overall effectiveness of the relevant policies”.
“In light of the limitations of the ‘poverty line’, the current government has developed a multidimensional analytical framework based on the ‘people-oriented’ principle to examine the characteristics, needs and difficulties of the target groups from multiple perspectives,” the Labor and Welfare Bureau said in a related document.
Income indicators
Commenting on the change after the report was released, Sun said the income-based poverty line could not accurately identify those in need, showing older residents who had no income but owned their own property and assets.
Using an income-based standard could overestimate the number of those in need, he said.
Addressing Sun’s claim about income-based metrics, Oxfam Hong Kong said that the value of assets can be converted into an estimate of monthly disposable income.
The charity also said the new framework could better use income indicators to identify high-risk individuals and inform poverty prevention policies.
