17 October 2018
One in seven people in Hong Kong are estimated to live below the poverty line. Photo:
One in seven people in Hong Kong are estimated to live below the poverty line. Photo:

New methods and mindset needed in anti-poverty fight

During a summit of the Commission on Poverty earlier this month, Chief Executive Leung Chun-ying claimed that his policy initiatives over the past four years — such as introduction of the Old Age Living Allowance and Low-income Working Family Allowance — managed to lift tens of thousands of people in the city out of poverty.

Despite the claims, the fact remains that some 970,000 citizens, or one in every seven people in Hong Kong, are still living below the poverty line. This suggests that there is still a very long way to go before poverty can truly be eradicated in our city.

To make matters worse, it appears the administration has failed to come to grips with some of the fundamental issues in fighting poverty, namely, the accurate way to measure poverty and the mounting grievances of the working poor.

For example, across the globe there are currently two different ways to measure poverty in a society. The first way is to measure it based on the median household income. For example, in Hong Kong, a family is officially considered as living in poverty if it makes less than 50 percent of our median monthly household income.

The second method to measure poverty, first proposed by the American academic Mollie Orshansky (1915-2006), is based on the percentage of family income that is spent on food. For example, in the US, a family is regarded as living in poverty if it spends 30 percent or more of its income on food every month.

The problem with measuring poverty based on the median household income is that, it doesn’t take into account the implications of inflation and predominance of big businesses such as the Link REIT on the actual quality of life of the average family. As a result, it fails to give us a full picture of the poverty issue in our society.

The government seems to be focused almost entirely on lifting people out of poverty through direct economic subsidies, whereas the more fundamental issue of how to facilitate upward mobility in society is largely neglected.

In consequence, the working poor in Hong Kong that total almost 2 million have found themselves trapped in a never-ending dilemma in which they are unable to work their way up the social ladder and improve their socio-economic status no matter how hard they work.

Their mounting grievances, sense of alienation and discontent could give rise to social unrest in the long run.

This article appeared in the Hong Kong Economic Journal on Oct. 25.

Translation by Alan Lee with additional reporting

[Chinese version 中文版]

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