Academics Warned Govt. of Growing Demands for Aged Care (Hong Kong)

HK needs a sustainable retirement program

By Peggy Chan

(HK Edition)Updated: 2008-03-04 Despite a large surplus in the 2007-08 fiscal year declared in the budget last Wednesday, academics warned that a sustainable retirement protection system is crucial as the population is aging.
According to the Census & Statistics Department, there will be one person aged over 65 in five Hongkongers by 2026, compared to only one in eight persons in 2006.

"We anticipate growing demands for health care and social welfare in the future and this is a challenge to the city," said the University of Hong Kong Department of Social Work & Social Administration professor Joshua Mok yesterday.

He welcomed the proposed health financing fund. "Hong Kong finances just over half of its health spending through general tax and non-tax revenues," he explained.
In addition, associate professor Paul Yip of the University of Hong Kong pointed out the tax base in Hong Kong is narrow, with only 20 percent of the population paying 80 percent of the salary.
Mok suggested the government come up with a sensible decision to widen the tax base to relieve the financial burden on medical services, which increased in line with the aging population.
"The government should review the taxation system during prosperous times," he said. "It is a very difficult decision, as most people do not want to pay more."
The academics also found it important for the government to review the Old Age Allowance Scheme (OAAS), but not just to raise the amount of assistance.

"Simply adding HK$300 to the monthly OAAS isn't a cost-effective method to help the elderly," Yip said. "The government should offer assistance addressing their need."
There have been voices calling on the government to raise the OAAS to HK$1000 from the current HK$705. Financial Secretary John Tsang said that the Labour and Welfare Bureau will conduct in-depth studies to explore a feasible long-term option for the OAAS.
Meanwhile, Mok highlighted the need for a young and talented population. Tsang proposed to provide 800 additional vacancies for postgraduate research programs and a one-off grant of HK$18 billion to establish a Research Endowment Fund.


SOURCE: chinaDaily