In response to media enquiries arising from newspaper reports about a study undertaken by the Hong Kong Social Security Society, a Government spokesman said today that there was no scientific method for drawing a "poverty line" nor was there an objective definition of "poverty" and any such attempt would involve subjective value judgement.

"If the concept of relative poverty is followed, some degree of poverty would always exist, even in the advanced countries," the spokesman said.

"In linking the so-called poverty line with median household income (on per capita median household income) would practically imply that, as an economy grows in affluence with continued increase in income over time, the relative poverty line would automatically be adjusted upwards, and that a poverty group exists even in the wealthiest countries in the world."

Commenting on the claim that the median household income per capita in 1996 was $5,463, and people with income half of this amount or below should be regarded as poor, the spokesman said: "Using a ratio of per capita median household income as measure of poverty may not be appropriate, as it ignores the fact that for larger size households, there should be greater 'economies of scale' in terms of sharing of accommodation and food."

In all economies, the spokesman said, economic growth is the primary means of generating income increases for the community.

"Given Hong Kong's continued economic growth over the past decade (by average of 14.4 per cent in nominal terms or about six per cent in real terms), income for every income group has registered substantial gains over the period. This includes the households in the low income group as well," he said, adding that the overall median household income in Hong Kong at current prices increased by 239 per cent from $5,160 to $17,500 over the past decade.

Also, the spokesman pointed out, the proportion of households with monthly income exceeding $8,000 (at 1996 prices) rose from about 69 per cent in 1986 to 83.5 per cent in 1996, while that of households with monthly income less than $8,000 fell from around 31 per cent to 16.5 per cent over the same period.

The spokesman said the transformation from manufacturing-based to service-oriented economy tends to increase the demand for high pay professional and middle-management jobs, thus lifting the higher end of the income spectrum.

"However, what is important is that Hong Kong is a free market economy. There is no barrier or impediment to entry into jobs in different sectors/ occupations/professions. Indeed, people in the low income bracket today will not be the same as those five or 10 years ago," the spokesman said.

"Very often, first time job seekers (young school leavers) and new immigrants will enter at the bottom and move upwards over time. Everyone through exercise of talent and hard work can raise their income, improve their standard of living and climb up the social ladder over time."

He emphasized that the long-standard objective of the Government was to maintain an overall environment favourable to economic growth, through providing a sound legal and institutional framework, a simple tax system with low tax rate, a stable financial sector, well-developed infrastructure and an efficient Government machinery.

"It is inappropriate and often misleading to describe the actual change in households' well-being without taking into account the various welfare provisions by the Government including free-subsidised education service, low cost public housing, free medical care, retraining and other government subvented welfare services all of which contribute to improving the living standard of the disabled, the elderly, the single parents and the low income households," the spokesman added.