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Following is the speech by the Secretary for Health, Welfare and Food, Dr Yeoh Eng-kiong, in the motion debate on "Ageing of the population" moved by Hon Tam Yiu-chung in the Legislative Council today (November 13):
Madam President,
I am grateful to the Honorable member Tam Yiu-chung for sponsoring this debate. I am also grateful to the other Honorable Members for their valuable views on the subject.
Ageing Trend in Hong Kong
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As members have already given out statistics relating to the projection of population ageing in Hong Kong, I should not repeat them. But just to reinforce the point that by 2031, about 2.12 million, or one out of four Hong Kong people will be aged 65 or above.
What does population ageing mean to us? Many in the community may view this phenomenon with alarm as larger numbers of older persons compared to those of working age are usually depicted to be associated with a higher dependency ratio in the community, and higher costs of medical and welfare services. However, according to the World Health Organisation (WHO), population ageing is first and foremost a success story for public health policies as well as social and economic development. We should not turn what is essentially a phenomenon reflecting the triumph of our achievements in health, economic and education systems into a forecast of gloom and doom, simply because we do not fully understand the meaning and impact of ageing. Ageing is a natural part of the life cycle. It is a lifelong process, which begins before we are born and continues throughout life. In other words, it is part of our human developmental process. We all experience ageing differently. Just as we have different abilities and physical capacities now and in our younger days, such variability will continue into our later life. Although our physical capacities may deteriorate in the later years, but such declines vary widely for different individuals. The declines are usually quite mild unless in the case of a major debilitating illness. When these insidious declines do occur, they are not uniform across all functions and can in many instances be compensated for. In fact, some people actually improve with age in psychological or cognitive capacity. We are heterogeneous no matter whether we are young or old, so it is not justified to stereotype older people. Many of the problems usually associated with population ageing are the result of outdated social and public policies which have not kept up with the changes in our socio-economic development and our health and demographic profile. These social and public policies are of our own construction, and can be transformed, so that older persons can continue to be actively engaged in and contribute to our community.
Transforming Social and Public Institutions
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Many of us feel anxious about growing old as older people are still portrayed as people who need protection, who cannot contribute and are vulnerable in society. But ageing is not necessarily about becoming frail and needing care. As a matter of fact, the majority of our elders are healthy and independent, and continue to contribute to their family. The negative stereotyping of older people is further reinforced by outdated social and public institutions. Let me quote a few examples -
(a) Retirement and human resource practices that remove older people from the workforce prematurely may reduce their income and social esteem, which place them in a state of dependency. In other words, retirement creates old age dependency, particularly financial dependency.
(b) A living environment that does not cater to people of all ages, and of different functioning abilities may discourage older people with some frailty from continuing to live at home (which is the preferred choice) and integrate with other members of the community.
(c) A compartmentalised lifecourse of education when young, work in adulthood, and leisure after retirement imposes an artificial segmentation of life which does not facilitate lifelong learning and the flexibility of work interspersed with periods of leisure and self reflection.
We therefore need to rethink our social and public institutions to see how they can be transformed to facilitate positive ageing. We as individuals also have to better prepare ourselves so that ageing can be a positive experience of seamless personal growth and development. For example, we need to make preparation for an adequate income if we opt to retire early. We need to live a healthy lifestyle, starting from an early age and continuing throughout life by exercising regularly, eat healthily and not smoking. We need to pursue lifelong learning to continue to be engaged in the richness of new understanding and knowledge, equipping us to be able to contribute economically and participate socially.
To provoke thinking and discussion, I wish to challenge two concepts which we may have taken for granted, namely the concept of elderly dependency ratio and the concept of retirement. First on concept of elderly dependency ratio, defined as the number of persons aged 65 and over per 1,000 persons aged between 15 and 64. It implicitly assumes that all people of so-called 'working age', that is, between 15-64 years old, are independent and productive, and all persons beyond that are dependent and non-productive. How can we assume that all societal wealth and productivity are only generated by those of an arbitrary age? Although the workforce participation rate of most older population decreases, many older persons are still engaged in paid and unpaid work and many more have the capacity to continue to contribute. If you look carefully, do we really believe that 15 year-olds should be defined as of working age when the majority are in their schooling years? Where should we draw the line then? Obviously there are older people in our society who need support, but there are people in their 40s, 30s and even 20s who also need support. Age is indeed an arbitrary line!
Second, on the concept of retirement. I wish to point out that retirement is not a natural part of the lifecourse. It is a social construction arising from industrialisation. In the pre-industrial period when family was often the basic unit of production, older people typically worked in a family farm or in small work organisations until they were no longer physically capable at which point the family provided the necessary support and care. Financial dependency of the old on the younger generation was also rare then as it was often the older generation who controlled the family production or business. It was only after the emergence of a public pension system in 1889 in Germany, with the establishment of an age threshold for pension eligibility, that in human history, retirement from paid employment has been made a distinct stage in the life course. According to Professor James Schulz, a renown economist in study of the economics of ageing, around the world, older persons want to contribute, pay their way, and remain a part of society. To push them aside or to ignore their wisdom, talents, and experience is not only cruel but makes no economic sense. And of course this applies to the amendment of the motion today.
Cross-sector Collaboration
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To meet the rising challenges of an ageing population, the whole community needs to be more aware of the implications of ageing, particularly on what they mean for the individual, and for the different sectors of the community. It is only through understanding and actions that the individual is equipped to take responsibility for his own well being, and the different social and public institutions can be adapted to facilitate the older person to remain actively engaged socially and economically in the community as far as possible. I support Hon Tam Yiu-chung's motion that the public and private sectors should work together to promote a proper perspective of ageing, namely "active ageing", and build a physical and social environment that continues to give full play to the abilities of our older persons.
Promotion of Active Ageing
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The WHO defines active ageing as "the process of optimising opportunities for health, participation and security in order to enhance the quality of life as people age", and offers a policy framework that requires action in three basic pillars: health, participation (paid as well as voluntary work and education) and security (social, financial and health security needs). Having regard to the WHO active ageing policy framework, and to cater to the needs and aspirations of our ageing population, especially those of the future cohorts, we are working with the Elderly Commission (EC), chaired by Hon Tam Yiu-chung, to promote a new awareness of the place of older persons in our society, not primarily as individuals needing help and needing necessarily exemption from new fees, but as people having much to offer and wanting to give. With good health, a longer life expectancy and an improved financial situation, their lifestyle and their role in society will markedly changed. To meet these changes, we need to advocate a change in the existing public and social institutions so as to facilitate older people in good physical and mental health to continue to fulfill themselves personally, socially, and economically.
Areas of Focus of the Government
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As the WHO has pointed out if ageing is to be a positive experience, longer life must be accompanied by continuing opportunities for health, participation and security. In this regard, the Government has taken proactive action to understand the phenomenon of ageing, and to take action in the identified areas of needs broadly along the direction of the three pillars advocated by the WHO. In the interest of time, I shall only focus my response on some selected areas.
Health
A life course approach to health maintenance
We recognise that much disability and ill health in later life are preventable if we take a life-course approach to promote active and healthy ageing in the community, targetting not only the current generation of older population, but also the future olds. In this connection, the Government has been rendering full support to the EC in launching a Healthy Ageing Campaign to promote active and healthy ageing along four strategic directions: promoting personal responsibility; strengthening community action; creating a supportive environment; and improving the image of ageing. Our eventual objective is to institutionalise healthy ageing as an on-going effort in the community.
Health Care Service for Elders
Ensuring the provision of adequate medical services for a growing and ageing population is one of the key policy objectives of the Government. In this connection, the Hospital Authority and the Department of Health (DH) currently provide a full range of in-patient, out-patient, ambulatory and community-based services. The services are heavily subsidised by the Government and provided to all, including older persons. Apart from the general services, we have also provided a number of direct health care and related services for older persons, such as the EHCs, VHTs and priority attention for patients aged 65 and over at General Outpatient Clinics.
Regarding Hon Leung Yiu-chung's proposed amendment that the elderly should be exempted from paying the new and increased medical fees and charges. This in fact reinforces the stereotype that all older persons are vulnerable and in need of help and assistance. This also goes back to the point made by the Hon Lee Cheuk-yan. In fact, this also reinforces the concept that older persons are a burden of the society. On the contrary, the Government does not believe that older persons are a burden of the society. The Government therefore does not agree that age should be used as the sole criteria for exemption from all new and increased fees and charges for medical services because we believe that many older persons have the ability to pay and have the ability to give. We believe that limited public resources should be targetted only at those in need. I wish to stress again that it is the Government's long held policy that no one, in particular elders, should be prevented, through lack of means, from obtaining adequate medical treatment. With the proposed new and modest increase in medical fees and charges, elderly recipients of the Comprehensive Social Security Assistance (CSSA) will continue to be exempted from all charges. We shall seek to strengthen and enhance our existing well-tested medical fee assistance scheme to assist those non-CSSA patients including the low income, the chronically-ill, and older persons with limited means who cannot afford even the highly subsidised public sector services. We therefore cannot agree with Hon Leung Yiu-chung's proposed amendment.
Participation
Senior Volunteerism and Lifelong Learning
We have been encouraging senior volunteerism and lifelong learning among elders so that elders can achieve a sense of worthiness. Social Welfare Department (SWD) has over 58 000 older persons volunteers registered. Many other elder volunteers contribute their time and expertise freely in social centres for the elderly, and in many other fields. Many non-governmental organisations (NGOs) run learning programmes providing interest classes, classes in life skills, and reading and language classes for older persons in their social centres. We shall seek to consider ways of promoting collaboration among stakeholders to enhance the opportunities for lifelong learning for elders.
Better Housing for Older Persons
To improve the housing conditions of older persons, the specific measures designed to allocate priority housing to elderly households have made the waiting list for public rental service reduced from 16,000 in 1997 to the present some 7,600. To actualise the concept of ageing in place, a number of pilot schemes have been implemented. For example, the Housing Authority will implement a universal design and provide integrated care services in rental estates with high concentration of older persons.
Security
Financial Support in Old Age
The Government is committed to providing financial assistance to elders in need. Currently over 600 000 older persons are receiving financial assistance through either the CSSA or the Old Age Allowance (OAA). This represents 61 per cent of the population aged 60 or above, or 78 per cent of those aged 65 or above. Total Government expenditure in financial assistance for elders is estimated to be $11.8 billion in 2002-03, accounting for 5.4 per cent of recurrent public expenditure and representing an increase of 50 per cent when compared to the $7.8 billion paid out in 1997-98. Both the CSSA and OAA Schemes are funded entirely from General Revenue and are non-contributory.
We are reviewing the social security schemes for older persons with a view to developing a sustainable financial support system for our needy elders in the light of the ageing population and in a changing environment, drawing reference from the "Three Pillar Approach" recommended by the World Bank.
We have already established the privately managed Mandatory Provident Fund (MPF), one of the two mandatory pillars recommended by the World Bank. We are currently reviewing the existing social security schemes for elders under the other mandatory pillar to ensure that it is sustainable in the long run, having regard to our ageing population and simple and low taxation system.
The Hon Leung Yiu-chung has proposed an amendment that any adjustment to the CSSA payment to the elders will not result in payments that are lower than the current level.
As Honorable Members are aware, we informed the Finance Committee in July that the current standard rates for CSSA would continue to remain frozen until the end of March 2003 despite continuous deflation and in the meantime the Government would review the CSSA system and gauge public opinion. We have not yet made a decision on the adjustment of the payment rates. But I would like to present some facts to Honorable Members. The CSSA standard payment rates have remained frozen since 1999, despite the continuous deflation in the past few years. We believe there is scope for a downward adjustment of the payment rates by 11.1 per cent as measured by the Social Security Assistance Index of Prices (SSAIP), without affecting the originally intended purchasing power and the associated quality of life. As far as elderly CSSA recipients are concerned, a one-person old age individual receives average monthly payments of $3,971 in 2001-02, while a two-person household receives average monthly payments of $6,379. These payments include standard rate ($2,555 per month for elders), a Long Term Supplement of $1,605 for singleton once very 12 months and a range of special grants for rent, telephone installation and monthly telephone charges, installation and monthly service charges for emergency alarm system, special diet allowance, medical, rehabilitation and surgical appliances, glasses and dental treatment etc. Recipients also receive free medical treatment at Government hospitals and clinics.
The findings of the 1996 CSSA Review showed that CSSA rates for the elders were adequate to meet the elderly recipients' basic and essential needs. Since then, elderly recipients living in a family were given an increase of $180 from April 1996 in their standard rates. The standard rates for the elderly were increased by $380 in real terms in April 1998 to encourage them to participate in more social activities. All in all, the CSSA payments for the elderly provide for a better than basic standard of living. In addition, there is a very well established network of welfare services for older persons in Hong Kong providing heavily subsidised community and home-based support, including home help and meal services.
The CSSA expenditure now accounts for some 7.8 per cent of Government recurrent expenditure. As at September 2002, the year-on-year growth in overall CSSA caseload was 12 per cent. Fifty-four per cent of the total CSSA caseloads are old age cases. Based on this trend, we project that the approved provision for CSSA in 2002-03 of $16 billion, which already contains a growth of 11.1% over the actual expenditure of $14.4 billion in 2001-02, will not be enough to meet with the increasing demand, and the estimated requirement for 2003-04 would be well in excess of $18 billion. To sustain this safety net, we have to ensure our existing resources go further to meet the increasing demand. Without pre-empting a decision on the review of CSSA payments, we cannot agree with Hon Leung Yiu-chung's amendment.
Hon Fung Kin-kee has proposed an amendment to the motion urging the Government to actively consider the implementation of an old age pension scheme to safeguard the livelihood of the retired elderly. An OPS scheme is a "defined benefits" and in many instances "pay-as-you-go" (PAYG) contributory system providing pension benefits for the aged with contributions from employers, employees and the Government. The possibility of setting up an OPS has been extensively discussed by the community in the mid-1990s when the Government explored options to provide retirement protection for elders. There were then diverse views expressed on the proposal. While some members of the public gave support to the proposal, others considered it unfair because of a lack of relationship between benefits and contributions; the OPS would shift the burden of old age protection from the individual/family to society; the OPS is not sufficiently discriminating in targetting assistance at those in need, and there is a question of inter-generational equity. Overseas experience shows that the sustainability of such a system is in doubt, in view of population ageing, lower fertility rates and increasing life expectancy. There is now a well-recognised need for many Organisation for Economic Co-operation and Development (OECD) countries to re-engineer their PAYG system.
Against the above background and given that the MPF scheme was intended to be one of the two mandatory pillars recommended by the World Bank, and has only been implemented for a short period of time, we consider that our priority in the next few years is to consider developing the second of the mandatory pillars, that is, a sustainable safety net for needy elders. We therefore disagree with the amendments proposed by Hon Frederick Fung.
Summary
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Over the past few years, the Government has put in a lot of efforts to review and re-engineer direct services for elders, in the areas of housing, home and community care and residential care etc. We have also adopted a preventive and life-course approach in promoting a healthy lifestyle and a positive image of ageing, and provided targetted health care service for older persons.
To move towards the promotion of active ageing, the Government, with the participation of 13 bureaux, departments and public organisations, and the Elderly Commission (EC), organised a Symposium on the Challenges and Opportunities of an Ageing Population in June 2002, aimed at enhancing the community's awareness of ageing issues. The Symposium drew together different sectors, different disciplines, and different age groups to discuss the implications of population ageing in Hong Kong. A number of issues related to the demographic shifts, such as the strategies adopted by other countries/regions for an ageing population, the economic and business implications of an ageing population, public perception of ageing, the changing workforce and concept of retirement, how the built environment should respond to the needs of ageing, and the changing healthcare focus etc. were examined. I wish to highlight the economic and business implications of an ageing population. People in their sixties and many in their seventies today and in the coming generations are far from being 'old, frail and dependent'. Our society cannot overlook the potential of a booming silver market when the coming cohorts of older people are healthier, enjoy longer life expectancy, and a much higher standard of living with better financial planning. Besides establishing an elder-friendly service culture, a successful business model should cater to customers of all ages.
We are encouraged to note that in response to the Symposium, a number of related sectors in the community have started taking a much deeper interest in the issue of an ageing population, and are considering different actions and programmes to follow up discussions on the subject.
Reinventing Ageing
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Looking ahead, the Government recognises that population ageing presents more opportunities than challenges. But Government action is not enough. As I said at the beginning of my address, society itself needs to create a conducive environment to enable older persons to continue to perform roles that fulfill themselves personally, socially and economically. Public and social institutions need to be transformed to enlist the experience and energy of older persons for the benefit of both the society and themselves.
We will continue to seek to engage the community in reinventing the concept of ageing, and rethinking and transforming our social and public policies. We will take an intergenerational, cross-sectoral and multi-disciplinary approach to meet the changing needs of an ageing society, involving not only individuals, but also the family, the community and the government. We will also endeavour to continue to improve the community's understanding of ageing as a natural, continuous and positive process. I take the opportunity of this debate to appeal to Honorable Members of this Council and through you, to the community at large to work with the Government to bring forth these changes.
End/Wednesday, November 13, 2002
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