Friday, 15 July 2011

Need Money to Dole Money

The debacle of the government handing out the HK$6,000 ($770) to Hong Kong residents is growing even bigger.
Last week the government submitted papers to the Legislative Council's Finance Committee to get financing for this undertaking -- and it's going to cost a lot of dough.
The proposal talks about establishing a new computerized platform to handle the process, upgrade computers in the Treasury and Immigration Department, and hire additional staff for Financial Services and Treasury Bureau and the Immigration department.
The government also needs to have detailed talks with the city's banks as they will have to act as agents in this process.
While the government is offering HK$6,000 per person, it projects to start making payments as early as November and will offer an additional HK$200 to those who wait until March next year for the money.
What does this all mean?
The paper says 6.19 million people are eligible for the payment so it will need HK$29.7 billion and an additional $7.675 billion for those who the government thinks will opt for the deferral (in other words the extra HK$200).
Then the banks will be paid HK$10 for every case they handle, as well as Hongkong Post. Those charges are expected to add up to HK$92.1 million.
To publicise the scheme and answer public inquiries, the government expects to shell out HK$39.6 million; and extra staff needed for this operation will cost HK$45 million.
The cost of setting up and upgrading computer systems will be HK$14.8 million. 
That means the government is looking for HK$191.5 million just to disperse the funds, and HK$244 million for those it thinks will wait for the HK$200 bonus, or 20 percent of those eligible.
The proposal to give out the HK$6,000 was made four months ago; and it'll probably be early next year when we finally get the money in our hands. 
What a fiasco. 

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