Despite the massive package, the billions going into relief measures won’t save sacked employees.
Photo: Diane Robert
This week the government announced a massive HK$137.5 billion package of relief measures, with at least $80 billion Employment Support Scheme allocated towards helping businesses as they continue to ride out the pandemic.
The $80 billion will be paid directly to businesses, which employers will use to pay their employees. They will receive funds to pay 50 percent of their employees’ salaries up to a maximum of HK$18,000 (the median monthly wage) a month for a period of six months.
As part of the scheme, employers must not lay off any staff.
“We want the staff to be engaged in work so that when the epidemic situation stabilises there will be more business,” said Chief Executive Mrs Carrie Lam.
To ensure that the money has been fairly distributed, the government will audit the beneficiaries. This scheme is expected to help 1.5 million workers.
Other highlights from the relief package include:
- One-off subsidies given to self-employed workers who make MPF contributions.
- MTR fares will be reduced by 20 percent for six months starting in July.
- Creating 30,000 new short-term jobs, which will cost $6 million over the course of two years.
- The CE and her cabinet will take pay cuts of 10 percent for a period of 12 months.
One of these measures’ main criticisms was whether the money was going to those who need it most. Businesses that have profited from the pandemic, such as supermarkets, will receive money from this scheme while employees forced to take unpaid leave will not.
Labour Party lawmaker Mr Fernando Cheung argues that the government does not need to spend as much as it is to assist the hard-hit businesses of the crisis.
“Instead of having to pay $80 billion for the entire market businesses we would only be paying a fraction – one-fifth of the money – and the rest should go to helping those who have lost their jobs,” he said.
The scheme’s main priority is to save people’s jobs and will not protect staff from salary cuts, noted Mr Law Chi-kwong, the Secretary for Labour and Welfare.
Combined with the $120 billion package in the 2020-21 Budget and the $30 billion Anti-epidemic Fund from February, the government has spent a total of $287.5 billion (10 percent of the GDP) in relief funds in response to HK’s economic downturn in light of COVID-19, the protests, and the US-China trade war.
Readers can access this interactive timeline for more information on the government’s policy response since the coronavirus outbreak began.
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