Poverty alleviation, coverage and fiscal sustainability: Investigating the effect of a new social pension in Hong Kong

Stefan KÜHNER , Kee Lee CHOU

Research output: Contribution to journalArticle

Abstract

This article synthesises the characteristics of social pensions across Asia and evaluates the effect of a new social pension in the Hong Kong SAR, the Old Age Living Allowance (OALA), on poverty alleviation, coverage rates and fiscal sustainability. We found that the effectiveness of the OALA in reducing old‐age poverty was limited, although it has led to an increase of retirement pension coverage by 6%. The OALA is projected to face substantial cost increases in the medium and longer term. Increasing the level of OALA benefits would be a direct means to enhance its poverty alleviation effect but may potentially be hampered by concerns about the fiscal sustainability of such changes. More obfuscated alternatives for Hong Kong policy makers to affect old‐age poverty alleviation include adjusting the indexing rules of benefit level payments and the eligibility criteria to reduce the stigma attached to the current policy choices. Copyright © 2018 The Author(s).
LanguageEnglish
Pages89-99
JournalInternational Journal of Social Welfare
Volume28
Issue number1
Early online dateApr 2018
DOIs
Publication statusPublished - Jan 2019

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pension
old age
Hong Kong
old age poverty
coverage
sustainability
poverty
retirement pension
indexing
costs

Citation

Kühner, S., & Chou, K.-L. (2019). Poverty alleviation, coverage and fiscal sustainability: Investigating the effect of a new social pension in Hong Kong. International Journal of Social Welfare, 28(1), 89-99. doi: 10.1111/ijsw.12321

Keywords

  • Social pension
  • Old‐age poverty
  • Pension coverage
  • Pension sustainability
  • Older people
  • Hong Kong