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Following is a question by the Hon Cheung Kwok-che and a written reply by the Secretary for Labour and Welfare, Mr Matthew Cheung Kin-chung, in the Legislative Council today (October 24):
Question:
On August 17, staff of my office made an enquiry with the Social Welfare Department (SWD) on the eligibility for the Comprehensive Social Security Assistance Scheme (CSSA). An officer from the Social Security Field Unit said, "The loan borrowed by a CSSA applicant will not be counted as income as long as the applicant can prove that the loan has to be repaid within a certain period." I am given to know that staff of SWD have said that the loans made to students under the Financial Assistance Scheme for Post-secondary Students (FASP) managed by the Student Financial Assistance Agency (SFAA) are grants in nature and are regarded as income, and therefore such students are disqualified from applying for CSSA. However, SFAA papers show that FASP comprises grants and/or loans, and the loans under the scheme are government loans. The students have to start repaying the living expenses loans, together with interests at the rate of 1% per annum, upon their graduation. In this connection, will the Government inform this Council:
(a) why government loans are regarded as income since loans are not regarded as income, according to the above-mentioned SWD staff;
(b) of the loans which are regarded respectively as loans, grants and income according to the policies and previous practice of SWD;
(c) given that the loans made to students under the FASP have to be repaid by instalments upon graduation of the students concerned, whether such loans are counted as loans or grants by SWD;
(d) whether the authorities will continue to make CSSA payments to post-secondary students from CSSA recipient families so that they need not live on loans; if so, of the details; if not, the reasons for that; whether the authorities will immediately reinstate the eligibility of those post-secondary students with disabilities from CSSA recipient families to apply for CSSA; if so, of the details; if not, the reasons for that;
(e) whether, the authorities will repay the loans on behalf of post-secondary students from CSSA recipient families who have borrowed loans under FASP, when they are unable to do so upon graduation; if so, of the details; if not, the reasons for that; and
(f) whether it has assessed if the disqualification of post-secondary students by SWD from applying for CSSA will defeat the purpose of setting up CSSA?
Reply:
President,
My reply to the question raised by the Hon Cheung Kwok-che is as follows:
(a)–(d) and (f) The Financial Assistance Scheme for Post-secondary Students (FASP) is administered by the Student Financial Assistance Agency (SFAA). It aims to provide financial assistance to students pursuing self-financed, locally-accredited full-time sub-degree or degree programmes, to ensure that these students will not be denied access to education owing to the lack of means. Needy students have to pass family income and asset tests, and SFAA determines the amount of grant and/or low-interest loan for them in accordance with the "Adjusted Family Income" and "Sliding Scale of Asset Value for Discounting Grant and Loan Assistance" mechanisms.
Since post-secondary students joining the FASP are already provided with financial assistance under that scheme to meet educational and daily expenses, they should not receive further assistance under the Social Welfare Department's Comprehensive Social Security Assistance (CSSA) Scheme. If students participating in FASP are members of CSSA families, the Social Welfare Department will not count the grants and loans obtained from SFAA towards their families' total resources. The above arrangement is in line with CSSA's objective of being a safety net of the last resort for those in financial hardship.
(e) SFAA has put in place a mechanism for assisting students who have difficulty in repaying their loans. Student borrowers, whether or not they are from CSSA families, may apply to SFAA for deferring loan repayment if they encounter difficulty in repaying their loans on grounds of further pursuit of full-time studies, financial hardship or serious illness. SFAA considers such applications on the merits of individual cases. In 2011-12, over 80% of the applications for deferring repayment were approved. If individual student borrowers ultimately cannot repay their loans, SFAA will demand repayment from the loans' indemnifiers. Where the situation warrants, SFAA will also liaise with the loan borrowers or indemnifiers to agree on a loan restructuring plan in order to assist them to repay the loans.
Ends/Wednesday, October 24, 2012
Issued at HKT 12:02
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