1.16m Hkers living in poverty: Study

HKCSS proposes low-income supplement that focuses on children

As many as 1.16 million people in Hong Kong, or 17 percent of the population, are living in poverty, according to an estimate based on the poverty line poised to be adopted officially.

The Hong Kong Council of Social Service (HKCSS), which announced the news on Thursday, also said poverty among children and the elderly has barely improved in a decade.

The Commission on Poverty intends to fix the city’s poverty threshold at half of the median household income. It will hold a meeting next Monday to assemble the latest data in preparation for the September announcement.

Using recently released 2012 data, HKCSS discovered 1.16 million of the city’s residents, or 453,000 households, fell below the proposed poverty threshold last year, representing 17 percent of the population. About 10,000 more individuals fell into the group compared to 2011.

According to HKCSS’s analysis, the data shows the minimum wage policy has continued to improve the lives of the economically active population, as 2012 marked a record low year for the poverty rate in the 25-64 age group since 2002.

The overall poverty rate has improved gradually from 18.3 percent in 2002 to 17.1 percent in 2012, but the overall poverty problem has remained bleak at both ends of the age spectrum.

While only one out of 10 residents in their golden age of 25-44 lives in an impoverished household, about one in five (22.2 percent) children aged 14 or below, and one in three (32.6 percent) seniors aged 65 or above live in poverty.

HKCSS noticed the poverty rate among the elderly has slipped 1.1 percent since 2002, but the actual number of seniors falling under the poverty line has grown by 43,000.

Outgoing chief executive of HKCSS, Christine Fang Mengseng, explained that without the backup of the Mandatory Provident Fund scheme, which only launched in late 2000, it was natural to see more seniors struggle in poverty as the population ages.

The impact of the Old Age Living Allowance, which only came into force this year, was not reflected in the 2012 data. Feng expected the “midway solution” to bring some relief, and she particularly appreciated the individual-based means test, but she stressed the elderly will need a comprehensive universal pension scheme to stay out of poverty.

The HKCSS also revealed its proposal for a low-income supplement on Thursday, with an emphasis on tackling poverty in households with young children.

In the HKCSS model, households that earn 50 percent or less of the median household income will get a full subsidy that is equivalent to 10 percent of the median income, such as HK$2,350, for a three-member family.

Families that earn between 50 to 70 percent of the median will receive proportionally discounted subsidies. The HKCSS proposal would waive asset tests, but qualify families with children aged under 16, or teens of 16 to 18 that are at school.

The council expected the proposal to cost taxpayers HK$4.8 billion a year, but it might also pull 190,000 residents out of poverty, including 60,000 children, and contribute to a 2.8 percent drop in the overall poverty rate.

The government has reportedly endorsed the concept of a new low-income subsidy at the commission last month to target households where humble income has exceeded the ceiling for Comprehensive Social Security Assistance.