Poverty rate slightly increases

December 23, 2020

Hong Kong recorded a poor population of more than 1.4 million people and a poverty rate of 21.4% according to the pre-intervention poverty figures in 2019.


The Hong Kong Poverty Situation Report 2019 released by the Government today showed that recurrent cash measures lifted 392,900 people out of poverty and reduced the poverty rate by 5.6 percentage points last year.


After the Government's recurrent cash intervention, the poverty rate recorded a slight increase in 2019 of 0.9 percentage point to 15.8%.


The Government said the Hong Kong economy, hit by local social incidents and China-US trade tensions, fell into the first recession since the global financial crisis in 2009 and the labour market slackened noticeably in the second half of last year.


As the local social incidents caused severe disruptions and battered consumption and tourism sectors that involved substantial lower-skilled jobs, grassroots families were particularly hard hit.


All these unfavourable developments, coupled with an accelerated ageing trend and continued dwindling household size, exerted unprecedented upward pressure on the poverty indicators.


The Government pointed out that the poverty alleviation impact of recurrent cash policies was a record high since the publication of the poverty line in 2013.


Among the measures, the Comprehensive Social Security Assistance and the Old Age Living Allowance had the most notable impact on poverty alleviation, lifting 155,200 and 154,400 people out of poverty, while the Working Family Allowance (WFA) lifted 47,600 people from 13,100 beneficiary households out of poverty.


It also emphasised that more than 35% of the increase in poor population came from working households, indicating that the weakened economic environment with fewer job opportunities would have a negative bearing on the situation of working poor.


Meanwhile, the report revealed that the poverty alleviation impact of non-recurrent cash measures increased notably when compared with 2018, which was mainly due to the one-off Caring & Sharing Scheme and the offering of an additional two-month payment of social security allowance, the WFA and the Work Incentive Transport Subsidy.


Regarding the means-tested in-kind benefits, the poverty alleviation impact of public rental housing provision is the most notable, reaching 3.7 percentage points, up by 0.1 percentage point year-on-year.


The Government added that the report only covers the situation up to 2019 and has yet to reflect the COVID-19 outbreak's negative impact on grassroots individuals in the city.


Noting that it has launched a series of one-off relief measures amounting to over $300 billion to help tide the community and various sectors over the difficult times, the Government said the effects of such measures could not be completely reflected in the main poverty statistics next year given the current design of the poverty line framework.

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