Hong Kong’s Financial Secretary Paul Chan gave the final budget address of his term on Wednesday. Although the city’s economy experienced a significant rebound in last year, the fifth Covid-19 wave has undercut that recovery and brought “immense pressure” to consumer markets, Chan said.
On top of tax cuts and subsidies to companies and individuals, the government also plans to distribute HK$10,000 to all adult residents via electronic vouchers, as well as ban landlords from taking action against business tenants from specific sectors for up to six months.
HKFP has rounded up reactions to the budget proposals from political parties and NGOs.
Democratic Alliance for the Betterment and Progress of Hong Kong (DAB)
In a press release on Wednesday, the DAB, Hong Kong’s largest Pro-Beijing party, praised the budget, saying that it “heads in the right direction” and suits the city’s current “extraordinary socio-economic situation.”
The party, which has 19 seats in the 90-member Legislative Council, said the temporary eviction ban on business tenants was a “breakthrough” in terms of government measures. It also welcomed the HK$10,000 spending vouchers and other subsidies to citizens.
However, it said that multiple stakeholders had voiced concerns that the proposed six-month eviction ban could cause a chain reaction of unwanted effects, as the cash flow of smaller property owners could be disrupted and tenants might not be able to handle the burden of accumulated rental costs.
The DAB also said it was “disappointed” that the rental reductions offered to public housing tenants in previous years were not included in this year’s budget.
New People’s Party
New People’s Party’s chair Regina Ip said on Wednesday that the party supported the government’s funding proposals for departments participating in the fight against Covid-19, and measures helping citizens and small and medium enterprises.
But Ip said it would be better if the HK$10,000 were a cash handout. “Many low income citizens who have lost their jobs or whose income has been reduced are in more need of cash,” Ip said. “Spending vouchers are limited for use in retail or catering sectors, while the electronic consumption platforms will benefit the most.”
Applications for unemployment relief will not open until mid-March.
Ip also suggested the government ask large companies, such as the MTR Corporation and Link Corporate, to waive rents from their business tenants.
“Over these six months, enterprises, especially small to medium businesses, will lose much of their income. How can they repay the accumulated rent for these months?” Ip said.
Michael Tien
Pro-establishment lawmaker Michael Tien said he was glad that the government planned to give out consumption vouchers, but that when they could be used was key to whether they could boost the economy. “At the moment the situation for the pandemic is dire,” he said. “After receiving the first instalment [of spending vouchers in April], will we even be able to go out and shop?”
Additionally, Tien said he was unhappy with the budget’s lack of support for nursing homes. He said the government “has not provided any support to elderly care homes,” which have been struggling during the Omicron outbreak with shortages of medical supplies and manpower.
Democratic Party
The Democratic Party said in a press release on Wednesday that the budget did not go far enough to relieve people’s economic pressures, adding that the government should provide more financial support to those affected by the fifth Covid-19 wave.
The party’s chair Lo Kin-hei said the government should give cash instead of vouchers so that citizens had more options on how to spend it.
Moreover, the Democratic Party’s spokesman on labour policies, Kelvin Sin, said the budget “overlooked the urgent needs of low-income workers” and the proposed enrichment of the personal loan guarantee scheme would not be enough to help those who lost their jobs or were underemployed due to anti-pandemic policies.
Sin suggested the government increase subsidies for the unemployed and set up a long-term unemployment compensation system.
Hong Kong General Chamber of Commerce
Peter Wong, the chair of the Hong Kong General Chamber of Commerce, called the budget “a suitable strategy during this difficult time” in a statement released on Wednesday evening.
The chamber said that businesses were facing “dire liquidity constraints” as Hong Kong stands at a critical point in its fight against Covid-19 and “further relief measures will be a literal lifeline for many firms.”
The profits tax and rates rebates, as well as other business fee concessions, “will bring some relief for struggling businesses,” the statement read.
Society for Community Organization
The Society for Community Organization (SoCO) said the budget was “disappointing” as it merely reintroduced past measures and lacked support for underprivileged groups. “The so called ‘common prosperity’ was an empty promise…[the government] is sitting with over HK$900 billion fiscal reserves, but the aids towards low income citizens are less than a drop in the bucket.”
The group said the rent was the largest difficulty faced by low-income citizens who did not reside in public housing estates, but electronic vouchers could not be used to pay landlords.
Although the coupons could be spent on groceries, SoCO said eligible stores would “seize the chance to raise the prices or offer more expensive products,” while many smaller vendors in older districts did not support digital payment methods.
SoCO also said it could not understand why the government only planned to give social security recipients half a month of extra allowances, while in past years’ the budget had offered at least one month.
Oxfam
The charity said it was concerned that the proposed relief measures and the sixth round of anti-epidemic fund were not enough to help the underprivileged in Hong Kong.
“Some workers told us that they have not worked since the beginning of the year and have not had any sort of income, but they are still employed by a company, making them ineligible for unemployment aid,” Kalina Tsang, the director general of Oxfam Hong Kong said in a press release.
They urged the government to offer relief to those on unpaid leave, as well as provide a one-off subsidy of HK$4,500 to low-income households not living in public housing and not receiving the Comprehensive Social Security Assistance.
Rehabilitation Alliance Hong Kong
The NGO said it was “regrettable” that the budget only briefly mentioned disabled people. As most disabled people came from low-income households, the alliance said that the pandemic has put huge financial pressure on them. However, the budget lacked measures to offer long-term relief.
The alliance suggested allocating a fixed number of the temporary jobs mentioned in the budget to those with disabilities and offering one-off payouts to social welfare institutions that are not government-funded.
According to the NGO, many social enterprises and smaller businesses that employed disabled staff had been forced to close under the government’s social distancing measures, worsening the unemployment situation among those with disabilities.
The NGO also urged authorities to provide the Social Welfare Department and other social service organisations with more resources to support the caretakers of disabled individuals, as their mental stress had gone “through the roof time and again.”
Greenpeace
The environmental protection campaign group slammed the budget for having no details on how to achieve “carbon neutrality,” despite announcing last year that HK$ 240 billion would be reserved to tackle climate change to help the city achieve net-zero emissions by 2050.
The NGO said the budget “has almost ‘zero funding’ on carbon reduction” and “lacks macroscopic and concrete measures.”
It urged the government to revoke the Lantau Tomorrow Vision reclamation plans and prioritise developing brownfield land.
WWF
WWF-Hong Kong said it agreed the government should set up a dedicated fund for the Northern Metropolis development, and urged the government to construct a sustainable and climate resilient Northern Metropolis by formalising the implementation of Strategic Environmental Assessments.
Nevertheless, the environmental concern group said they object the reclamation plan involved in the Lantau Tomorrow Vision.
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