Tuesday, 19 June 2012

HK's Income Gap Widens Further

Tackling povery in Hong Kong is a stormy issue
The gap between the rich and the poor in Hong Kong is getting steadily worse.

The Gini coefficient -- a complicated calculation that results in a number between 0 and 1, and the closer to 1, the greater the income inequality.

Based on income data from 2011, the latest calculation is that Hong Kong is at 0.537. It was 0.533 five years ago, and 0.451 in 1981.

Hong Kong's number is among the highest among developed countries, as Singapore is 0.482 and 0.469 in the United States.

This is more ammunition for poverty advocates to argue that despite economic development, the government has not done enough to alleviate financial issues among the poor.

Meanwhile officials are warning income disparity will get worse in the next few years with an increasing aging population that removes more people from the workforce.

According to the Census and Statistics Department, the number of "economically inactive households", families where no one is working, increased by 48 percent from 280,000 to 420,000.

The Census department also showed that the median monthly income for the city's poorest 10 percent, including those who received social security assistance, dropped from HK$2,250 ($290) per month to HK$2,070 in the past five years, while those in the top 10 percent made HK$95,000 compared to HK$76,250 five years ago.

Commissioner for Census and Statistics LIly Ou-yang said yesterday the legislation of minimum wage laws and economic growth had helped low-wage earners, but also helped the wealthy as well so the wage gap did not close much if at all.

Also chief executive of the Hong Kong Council of Social Service Christine Fang Meng-sang said the government should no longer assume economic growth could improve the living standards of the poor.

Poverty advocates have estimated more than 1 million people in Hong Kong live in poverty, though strangely the government does not have an official definition. Does this mean it doesn't even recognize they exist?

Hopefully incoming Chief Executive Leung Chun-ying will finally address the problem properly. On Sunday he said a preparation committee for an anti-poverty commission would be revived in order to set out policies to help this sector of people who badly need assistance.

There are families who live on about HK$100 a day which seems virtually impossible, but true.

Chan Yik-ping has a family of four who depend on her husband's waiter salary of HK$8,000 a month. One quarter of it is spent on rent for a small cubicle in a subdivided flat in Sham Shui Po, and then milk forumula and diapers for a new baby cost HK$2,000.

"I just took the baby to see a doctor today. It cost HK$100 and it's already the cheapest in town," Chan said. "It's nearly impossible for four people to live off just HK$8,000."

The family applied for public housing four years ago and have yet to hear if they can move to a bigger living space.

"My biggest wish is to be assigned a flat in a public estate soon. The children are growing up and it's getting more crowded here. My older son [who is 12 years old] has always wanted his own room, and I feel sorry that I haven't been able to give him that."

It's amazing these people manage to survive in this expensive city.

We hope Leung will enact some long-term policies that will really give these people the help they need.

A real concerted effort to tackle poverty is not a quick fix but a long road ahead.

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