Opinion | Can Carrie Lam keep her deathbed promise to David Akers-Jones by helping Hong Kongs poo

He had many significant roles but, for me, none was more important than his leadership of the Business Professionals Federation through which he channelled many of his keenest community concerns, focused on health care, the elderly, the young, the poor, housing and pensions.

For that reason, he would surely be with the federation in spirit this week as it releases its most recent study, which attacks the extreme inequality in Hong Kong, and provides important but contentious recommendations.

In the interest of full disclosure, I was part of the team shaping the report. On the one hand, the study is controversial – Sir David was never averse to stirring a little controversy. But, on the other hand, the study’s suggestions are painfully obvious, not because of Hong Kong’s awful summer of street violence, but also in view of uprisings across the world driven by rising concern over inequality.

There have been eruptions of violence over the past two weeks in Chile – one of South America’s must successful and affluent economies – which have not only led Chilean President Sebastian Pinera to raise the minimum wage and introduce reforms to health care, but also to replace eight of his ministers and to cancel major international events.

The Business Professionals Federation report, “Hong Kong at a Crossroads – Inequality must be reduced now”, begins by highlighting that Hong Kong is arguably one of the world’s most unequal economies – the gap between the rich and the poor is even wider than conventional Gini-coefficient measures of inequality would suggest. It argues that these inequalities are a direct result of an economic model built around government dependency on high property prices.

It notes that 24 families control over half the wealth of Hong Kong, that the richest 50 people have a collective wealth in excess of US$300 billion, that 10,000 Hongkongers have a net worth greater than US$30 million, and that one seventh of the population are “HK$ millionaires” with wealth, excluding property, greater than HK$1 million (US$127,625).

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“Many influential people have benefited enormously from the current ways of running Hong Kong,” the report says. “It is important that the Hong Kong government stands up to these vested interests and makes the changes that Hong Kong needs.”

The report calls for the government to develop 9,000 hectares for housing between now and 2045: “We must build flats in the next 10 years at about triple the rate envisioned by government planners,” it says.

“We do not oppose further reclamation but other land supply options must be pursued with more intensity. Much brownfield and agricultural land must be developed. Country parks should not be considered sacrosanct. Nor should golf courses or military land like Sek Kong … Our need for more housing should be paramount.”

It says the government should prioritise the privatisation of public housing: “We must take action to ensure that public housing tenants do not remain a permanent underclass.”

The report calls for the minimum wage – currently half that of Britain’s, and one-third of the figure in Australia – to be radically lifted. It suggests a “salary supplement” funded 100 per cent from government coffers.

For anyone earning HK$6,000 or less, the supplement should be HK$6,000 if they live in private rental housing, and HK$3,000 for others. It should be gradually reduced for those earning above HK$6,000: “These exact numbers are to some extent arbitrarily chosen but are underpinned by some core principles: they would be substantial enough to make a meaningful difference; they would be affordable; and implementation would not be costly or complex.”

The Comprehensive Social Security Assistance (CSSA) should be increased by 25 per cent on average, and the Mandatory Pension Fund contribution should be lifted from 10 per cent to 15 per cent of salary, with the extra 5 per cent contributed wholly by the government.

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The study estimates these three measures would cost the government about HK$90 billion a year – HK$55 billion for the salary supplement, HK$5 billion for the CSSA and HK$30 billion for the MPF – and should be guaranteed for the next five years: “These are large numbers, but Hong Kong has fiscal reserves of close to HK$1,200 billion and these programmes are affordable for five years without finding new revenue sources.”

Beyond five years, the report calls for a review of the tax system, and officials should consider “widening the definition of individual income to include dividends, interest income, capital gains and certain overseas income.”

“Hong Kong is at a crossroads. It needs to act to reduce discontent. It needs to re-establish its identity as the Government of all of Hong Kong people,” the report concludes.

Our chief executive promised to fulfil Sir David’s deathbed wish – to help the poor and build more housing. Let’s see if her government’s money is where her mouth is.

David Dodwell researches and writes about global, regional and Hong Kong challenges from a Hong Kong point of view

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