Hong Kong: Welfare, poverty and inequality

Poverty is a disease that still persists in Hong Kong. Despite strong GDPs, strong trade and large amounts of capital coursing through the economic veins of the city, the poor and elderly live in partitioned flats and “coffin” homes. In the New Territories, the neighborhood of Tin Shui Wai is known colloquially as the “City of Sadness” for its high suicide and unemployment rates.

At the bottom percentile, household incomes average HK$2,170 (S$340).

It is no doubt that Hong Kong spends well on social welfare (total estimated expenditure of the Social Welfare Department is HK$43.5 billion or SGD$6.87 billion). Unlike Singapore, they have adopted minimum wage, pensions and a universal welfare system.

Yet, problems continue to gnaw at the heart of the country, for example:

  • 1 in 5 people in live in poverty
  • The poverty line for a one-person family is HK$3,275 per month
  • 40% of the Hong Kong population live in subsidised public housing
  • 100,000 people live in coffin, cage homes and rooftops
  • Over 1,000 people are homeless
  • Hong Kong has highest income gap between the rich and the poor of any developed economy in the world
  • There are 650,000 working poor
  • 300,000 children do not get 3 meals a day
  • 1 in 3 seniors struggle to meet their basic nutritional needs

The city’s Chief Executive is not amused. Leung Chun Wing will head committees to tackle the many problems citizens face. To do so, he urges both law makers and the city government for co-operation. With a two-year deadline, this high level commission is tasked with reducing rates of poverty.

How the said commission plans to do all this remain under wraps. Press material merely give the official direction: “there will be efforts in planning and co-ordinating the work of different bureaus and departments to rationalise policies and integrate resources to implement anti-poverty measures.”

Amongst ideas discussed were also interesting perspectives on fostering tripartite collaboration.

With uneven distribution of income and widening of social/income gaps, inequality is further aggravated by large portions of the economy being dominated by small groups of tycoons. Growing unemployment and destruction of industries mean that some workers face no chance of rejoining the workforce. China’s ever increasing competitiveness has also shifted factories and manufacturing across to the mainland, resulting in the loss of jobs from this who are unskilled or unwilling to upgrade.

The current unemployment rate in Hong Kong is reported at 3.3 percent. In June 2003, it hit an all-time high of 8.60%. The creation of new, sustainable jobs with equal opportunity is of paramount importance. Observably, the industries that pay well and attract talent are ring-fenced around finance and property. However, wholesale and trading are wedged strongly as the stronghold of Hong Kong employment, hiring a good 30% chunk of workers.

With a demographic, social and economic landscape that is fairly similar to Singapore’s, Hong Kong is an important model for us to study. The country had recently adopted minimum wage and it spends almost the equivalent of Singapore’s GST proceeds on universal welfare each year. It would be ripe in a few years to see if these programs lead to more jobs and lower poverty.

Sources: Hong Kong Council of Social Services, Hong Kong Census and Statistics Department, SOCO, Oxfam Hong Kong

 

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Benjamin Chiang

Benjamin Chiang is an enthusiast of good advertising, deep thinking, labour issues and chocolate. He writes also at www.rangosteen.com and occasionally on Yahoo!

The views expressed are his own.

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11 Comments

  • Some of the absolute numbers you give don’t seem so terrible. 1,000 homeless out of a SAR of 7million people seems a drop in the ocean. Ditto the 40% in public housing. That means 60% can afford private housing. In SG, public housing covers 85%. Is that better or worse? You tell me? :lol:

  • Everyone is saying that Hong Kong is glitzy, got welfare, got minimum wage – but the problems Singapore faces is a fraction of what they experience. But one thing they’re good at – they have strong culture, something that Singapore is still trying to discover.

  • Sure or not?! 300,000 children do not get 3 meals a day and 1 in 3 seniors struggle to meet their basic nutritional needs?! Stop trying to show that they are worse off than us lah – Singpore has far worse problems: foreign talent, MRT problem, over crowding problem. Singporean better buck up, 6million foreigners coming our way.

  • the sick in hk only need to pay HK$100 daily for their stay / treatment in their public hospital.

    all above 65 get a monthly pension of K$1500 ( not sure the exact amount) and will be increased to HK$2200 from march 2013.

    In sinkieland, you cannot even use your own money in your medisave for certain drugs or treatment and you cannot even withdraw your own savings in cpf when you retire.

  • I’m not sure where “sinkieland” is mr.bird, but here in Singapore, there is not just MediSave (which will cover large portions of your medical bill), insurance (if you’re smart enough to buy any) and corporate insurance. If you’re dumb enough not to buy any insurance, nor save your money for emergencies, then that’s your own funeral.

    And like the article says, despite pensions and welfare, poverty continues to persist. And have you been to Hong Kong? Have you met people who wouldn’t even go to the hospital because they cannot afford treatment?

    Get a life and stop spreading lies.

  • You just have to watch HK TV to know how is HK compared to SG. The quality of life is really bad if you do not make alot of $$$. A fresh graduate pay is only SG 2k but price of food and Housing are 2-3 times higher. How to survive?

    For your info, I notice more and more Hongkies migrating to SG recently.

    • This is bordering on the ridiculous- watch TV to know the social problems of HK?
      Just because Singapore TV doesn’t portray the poor as much as HongKong’s do, then we are far better off than them?? Warp logic.
      Know why the local media is ranked so low in international standings?
      The hardly report any negative news that reflect badly on the Govt.
      More Hongkong migrating to Sin iso the other way is not so such we are better but of lax immigration polices.

  • I have a Brother who lived in Hkg for the past 30 years .
    Married to HK (Macau) managed to survive there and still
    working,yes live is tough there. the old saying dog eat dog situation. Not many sinkies can survive there , but they will win a prize for complains. Everytime i visit him
    i have to saty out of the kitchen cos it can only accomodate 1 person behind it…Out HDB 3 room is like a palace…i shall stop here. and mind you the rent for this shoebox (size 5 ) in good district is comparable to rents in a condo in singapore.

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