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11 APR 2021

Oxfam Hong Kong: Budget failed public Government must offer unemployment allowance

Oxfam Hong Kong released a new public survey today about the government’s 2021 budget, where the public gave a failing grade of 3.29 out of 10. Budget cuts to welfare programmes and the lack of response to demands for short-term unemployment assistance contributed to the low score. Oxfam Hong Kong urges the government to offer short-term unemployment assistance and cash allowances to the unemployed from low-income backgrounds as soon as possible.

Kalina Tsang, Director General of Oxfam Hong Kong, said: ‘The government has offered companies tens of billions of dollars to retain employees, but is only offering loans to the unemployed. We believe that the HK$15 billion set aside for the loan scheme could be put to much better use through short-term unemployment allowances which would immediately benefit the unemployed.’ Oxfam Hong Kong criticised the government for being generous to companies, but miserly towards the poor.

The Chinese University’s Hong Kong Institute of Asia-Pacific Studies, which carried out the study, found that close to 80% of respondents felt that the budget had failed to address the historically high unemployment rate, while close to 60% said unemployment loans were unhelpful.

Wong Shek Hung, Acting Director of Hong Kong, Macau, Taiwan Programme at Oxfam Hong Kong, said: ‘Financial Secretary Paul Chan said he hoped to “cook up something good” for the people of Hong Kong through the budget. All he came up with in the end though was an unemployment loan that was hard to stomach. After more than a year of COVID-19, many of the poorest have found themselves unemployed for extended periods of time. The “solution” they’re being offered though is a loan. How could anyone find this acceptable?’ 

Oxfam Hong Kong urges the government to offer a temporary unemployment allowance of HK$5,000 per month for at least six months to the unemployed from poor households (i.e. those whose household income is less than half of the median household income). To prevent welfare fraud, the organisation suggests requiring applicants to provide proof of unemployment and income proof to confirm that their household income is less than half of the median household income. Implementing this allowance would only require HK$2.4 billion, which is a far cry from the HK$15 billion and HK$80 billion spent on the loan scheme and the Employment Support Scheme respectively.

Between 5 and 17 March, 1,003 adults were surveyed over the phone about their thoughts on the budget as a whole, unemployment assistance and other budget measures.

On average, respondents gave the budget a score of 3.29 out of 10, with 64% giving it a fail (0 to 4 points) and 15.8% giving it a score of 0. Nearly 80% (78.9%) believed that the budget had not addressed the high unemployment rate, while 74% felt it did not help the poorest. 

Further, 58.2% of respondents believed that the Special 100% Loan Guarantee for Individuals Scheme would not help deal with unemployment, while 85% were pessimistic about Hong Kong’s employment outlook. They believed the bleak prospects would remain for some time and were worried that they would not be able to find a job in the short term.

Given the persistently high unemployment rate, Oxfam Hong Kong is also urging the government to lower the minimum number of work hours required in the Working Family Allowance (WFA) for half a year. By lowering it from 72 hours to 36, casual and temporary workers would also be eligible for the allowance, and eligible households would be able to receive two allowances. The government should also consider relaxing the WFA asset limit so that more workers are eligible for the allowance.

The organisation is also calling on the government to allow street vendors to use idle land so that they can earn an income through bazaars. In the long run, however, the government has the responsibility to explore the possibility of introducing an unemployment insurance programme to better protect the unemployed. 

- Ends -

About Oxfam
Oxfam is a worldwide development organisation that mobilises the power of people against poverty.

For media inquiries, please contact:
Roni Chan
Oxfam Communications Officer
Phone:+852 3120 5222

Ms. Kalina Tsang, Director General (right), and Ms. Wong Shek Hung, Acting Director of Hong Kong, Macau, Taiwan Programme (left), announced findings from Oxfam's latest public survey about the government’s 2021 budget, where the public gave a failing grade of 3.29 out of 10.