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LCQ6: Comprehensive Social Security Assistance Scheme and Social Security Allowance Scheme

     Following is a question by the Hon Leung Kwok-hung and a reply by the Secretary for Labour and Welfare, Mr Matthew Cheung Kin-chung, in the Legislative Council today (July 7):


     Regarding various types of payments under the Comprehensive Social Security Assistance (CSSA) Scheme, old age allowance (OAA) and disability allowance (DA), will the Government inform this Council:

(a) whether the Government will increase various types of CSSA payments, OAA and DA immediately in response to the aggravating inflation and continuous rising rental and food prices; if it will not, of the reasons for that; if it will, the amounts of increases, the effective date of the increase (whether the increase will have retrospective effect from April this year, adopting the same practice in the civil service pay adjustment), and the date of disbursement;

(b) given that the Government reduced in 1999 and 2003 the standard rates of CSSA payments (by 10% to 20% and 11.1% respectively), special grants (including payments to cover telephone bills, dental filings and spectacles, removal expenses and rent deposit, etc.) and long-term supplement, on grounds of deflation, whether the authorities will restore these payments to their original levels; if they will, of the time of the restoration and the amounts of increases; if not, the reasons for that; and

(c) given that the applicants for CSSA, OAA and DA must have been Hong Kong residents for at least seven years and have resided in Hong Kong continuously for at least one year immediately before the date of application (that is, not being absent from Hong Kong for more than 56 days during the one year period), of the number of such applicants whose applications were turned down in each of the past five years because they did not meet both or either one of the aforesaid residence requirements; whether the Government had assessed if the refusal to their applications would render these people unable to support their own living; given that following the High Court decision on June 21 this year that the requirement for the one-year continuous residence imposed on CSSA applicants breaches the Basic Law, the Social Welfare Department has suspended this requirement immediately, whether the Government will immediately lift the aforesaid two residence requirements imposed on OAA and DA applicants; if it will, when the requirements will be lifted; if not, of the reasons for that; and whether the Secretary for Labour and Welfare, being a Principal Official under the Accountability System, will take the blame and resign to shoulder the responsibility for implementing such illegal requirement over the years?


President's Deputy,

     The Comprehensive Social Security Assistance (CSSA) Scheme is designed to provide financial support to families in need to meet basic needs, whereas the Social Security Allowance (SSA) Scheme, made up of Old Age Allowance (OAA) and Disability Allowance (DA), helps elders aged 65 or above and persons with severe disability meet special needs arising from their old age or severe disability respectively.

     In the three parts of his question, Hon Leung Kwok-hung enquires about the adjustment mechanism and residence requirements under the two Schemes.  My reply is set out below:

(a) Standard payment rates under the CSSA Scheme and rates of the SSA allowances are adjusted on an annual basis to maintain their purchasing power, taking into account movements of the Social Security Assistance Index of Prices (SSAIP).  The SSAIP, which is compiled by the Census and Statistics Department (C&SD), reflects the impact of price changes on CSSA recipients.  In the last adjustment cycle (i.e. the period between November 2008 and October 2009), the moving average of the SSAIP indicated a small room for downward adjustment to CSSA standard payment rates and rates of the SSA allowances.  Having regard to the social and economic situation, we decided to freeze these rates for a period of 12 months with effect from February 2010.  We will continue to closely monitor movements of the SSAIP, and will adjust the CSSA standard payment rates and rates of the SSA allowances ahead of the next annual adjustment cycle where necessary.  The Administration activated this mechanism in mid-2008 and adjusted the CSSA rates upward by 4.4% in August of that year ahead of the annual adjustment cycle.

     In addition, to ensure that the SSAIP can reflect more accurately the latest expenditure patterns of CSSA households, the Social Welfare Department (SWD) updates the weighting system of the SSAIP (i.e. the relative expenditure share of individual items of goods and services covered by the SSAIP) every five years on the basis of the findings of the Household Expenditure Survey (HES) on CSSA Households.  SWD and C&SD have already commenced the latest round of the HES on CSSA Households for 2009-10.

     Civil service pay is part of the employment terms for staff; its nature is completely different from that of the two social security schemes mentioned above.  There is also no connection between the rate adjustment mechanisms for civil service pay and social security.

(b) Hon Leung Kwok-hung mentioned in his question the downward adjustments to CSSA rates made by the Administration in 1999 and 2003.  As we have explained on numerous occasions in the past, the measures were implemented for their own reasons.  The adjustment in 2003 was due to previous over-estimations of inflation and continuous deflation since 1999, resulting in an over-shoot of the CSSA standard payment rates by 12.4% up to March 2002.  The Administration therefore obtained the approval of the Finance Committee and adjusted the rates downward by 11.1% in April 2003 according to the established mechanism, to bring the purchasing power of these rates back to their original level.

     The introduction of a series of measures to encourage able-bodied CSSA recipients to seek jobs and the tightening of CSSA standard rates and special grants for these recipients since June 1999 were, on the other hand, results of the then rapid growth in CSSA expenditure and the able-bodied CSSA caseload which had caused public concern about over-reliance on CSSA by the able-bodied.  The Administration implemented these measures after extensive public consultation and the approval of the Legislative Council.  That said, the Director of Social Welfare (DSW) can consider exercising discretion to offer assistance to individual recipients encountering exceptional hardship, having regard to the actual circumstances of their families.

     Furthermore, the Administration has introduced a number of one-off measures in recent years in response to changes in the economic situation, sharing with Hong Kong people the fruit of economic prosperity and providing relief in difficult times.  These include the provision of one additional month of the standard rates of CSSA and SSA, last implemented on June 7 of this year.

(c) On residence requirements, since January 1, 2004, applicants for CSSA and SSA aged 18 or above must have been Hong Kong residents for at least seven years (i.e. the seven-year residence requirement) and have resided in Hong Kong continuously for at least one year immediately before the date of application (i.e. the one-year continuous residence requirement).  The above residence requirements provide a rational basis upon which our public resources are effectively allocated, help sustain a non-contributory social security system which faces an increasing demand, and strike a balance between the interests of various sectors of the community.  However, having regard to the judgment of the High Court on June 21 that the one-year continuous residence requirement under the CSSA Scheme violates the Basic Law and the Hong Kong Bill of Rights, SWD has ceased to execute this requirement under the CSSA Scheme.  We are carefully examining the judgment, its implications and the merits of an appeal.  According to the legal advice of the Department of Justice, the judgment targets the CSSA Scheme and has no direct impact on the residence requirements for OAA and DA legally.

     In the past five years, 167 CSSA applications, 31 OAA applications and 212 DA applications were rejected for the reason that the applicants failed to meet the seven-year residence requirement.  Details are provided at Annex A.  The number of CSSA, OAA and DA applications rejected because they did not meet the one-year continuous residence requirement is provided at Annex B.  SWD does not keep statistics of applications rejected for not meeting both residence requirements.

     If the Social Security Field Units of SWD receive CSSA or SSA applications from persons who do not meet the residence requirements, the case workers will explain the situation to the applicants, including the arrangements for DSW to exercise discretion.  To enhance transparency, SWD has published a pamphlet on the residence requirements to facilitate the public's understanding of these requirements under the CSSA and SSA Schemes and the main factors that DSW will take into account in exercising discretion.

     I would like to reiterate that it is not the policy objective of SSA to help recipients overcome financial hardship.  Nor is CSSA the only way to help those in need of assistance.  When there are proven needs, and subject to the applicants meeting the relevant eligibility criteria, other forms of assistance and support are available.  These include employment support services, emergency relief, temporary grants from charity trust funds, medical waivers, child care services, assistance in kind, and placement in singleton hostels.

Ends/Wednesday, July 7, 2010
Issued at HKT 15:56


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