XN000022-1994-09-07 — Page 6

WEDNESDAY, SEPTEMBER 7, 1994

5

BUDGET STANDARD APPROACH DEPARTS FROM

ESTABLISHED POLICY ON SOCIAL SECURITY PAYMENTS

ESTIMATES

THAT

THE

THE FOR

ΤΟ

THE GOVERNMENT

IMPLEMENTATING RECOMMENDATIONS CONTAINED IN AN ACADEMIC RESEARCH COMMISSIONED BY NEW BASIS HONG KONG COUNCIL OF SOCIAL SERVICE FOR ADOPTING A

ADDITIONAL $9 BILLION SOCIAL SECURITY PAYMENTS WOULD COST AN

PERCENTAGE $25 BILLION EACH YEAR; PUSH TAXES UP BY NO LESS THAN THREE POINTS; DRAW UP TO 240,000 PEOPLE OUT OF THE WORK FORCE AND RAISE SOME OF THE COMPREHENSIVE SOCIAL SECURITY ASSISTANCE (CSSA) THE MEDIAN WAGE.

PAYMENTS ABOVE

MISS JACQUELINE SERVICES PANEL TODAY MIGHT BRING IN AND THAT THE

INCREASE

THE DEPUTY SECRETARY FOR HEALTH AND WELFARE, WILLIS,

WELFARE TOLD MEMBERS OF THE LEGCO (WEDNESDAY) THAT BY RAISING THE CSSA THRESHOLD, IT NEARLY 160,000 MORE HOUSEHOLDS INTO THE SAFETY NET, AVERAGE PAYMENTS

HOUSEHOLD FOR $10,150, WHICH IS 123 PER CENT OF THE MEDIAN WAGE.

A

FOUR-PERSON

COST NEEDED

WOULD

то

IMPLEMENT

TO

THE

CENT OF THAT

"THE

ANNUAL ADDITIONAL RECOMMENDATIONS REPRESENTS ABOUT EIGHT PER CENT TO 23 PER GOVERNMENT'S ANNUAL RECURRENT SPENDING, AND WE COULD ONLY SPEND SORT OF MONEY BY EITHER CUTTING BACK ON OTHER ESSENTIAL SERVICES OR BY RAISING TAXES," MISS WILLIS SAID.

OF

"ADOPTING THE BUDGET STANDARD APPROACH WOULD MOVE THE FLOOR 'RELATIVE POVERTY' EVER UPWARDS, AND TO PAY FOR THIS, YOU WOULD NEED A BOTTOMLESS PIT OF FUNDS," MISS WILLIS CAUTIONED.

ARE

"EVIDENCE FROM ELSEWHERE IN THE WORLD SUGGESTS THAT PEOPLE EARNING AN INCOME

ΤΟ CLOSE

SOCIAL SECURITY DISCOURAGED FROM WORKING.

WHO

THE

RATES

ARE

FALL

IF THE IN HONG

"WE ESTIMATE THAT PARTICIPATION IN THE LABOUR FORCE WOULD BY 1.5 TO 5.0 PERCENTAGE POINTS, OR 70,000 TO 240,000 PEOPLE HIGHER RATES ARE ADOPTED. WE WOULD NOT WANT THAT TO HAPPEN KONG, SAID MISS WILLIS.

MISS

WILLIS

CAUTIONED

THAT

OF

THE GROWTH

IMPLEMENTATION RECOMMENDATIONS WOULD HAVE WIDE REPERCUSSIONS ON THE ECONOMIC AND DEVELOPMENT OF HONG KONG.

EXPAND WAGES AND

то ABILITY OUR "TAKING THIS ROUTE WOULD AFFECT PRODUCTIVE CAPACITY, LOWER THE GROWTH POTENTIAL, PUSH UP INFLATION, AND BLUNT OUR COMPETITIVE EDGE," MISS WILLIS SAID.

"TO

EXCEPT THE BEST OF OUR KNOWLEDGE, NO OTHER WELFARE STATES

ITS SOCIAL GERMANY PRACTISED A STRAIGHT BUDGET STANDARD APPROACH IN SECURITY PROGRAMMES. AS A RESPONSIBLE GOVERNMENT, WE HAVE TO CONSIDER MISS WILLIS WHETHER OUR COMMUNITY COULD AFFORD SUCH AN EXPERIMENT, SAID.

MISS WILLIS

STANDARD APPROACH" IN TO ADOPT A "BUDGET SAID

HENCE THE DETERMINING THE MINIMUM ACCEPTABLE STANDARD OF LIVING AND

THE PHILOSOPHY CSSA PAYMENTS WOULD BE A MAJOR DEPARTURE FROM ESTABLISHED POLICY ON THE PROVISION OF WELFARE IN HONG KONG.

AND

/"OUR POLICY