Letters | Hong Kong has a lot to learn from Taiwan on budget handouts

Hong Kong’s Financial Secretary Paul Chan Mo-po said in his budget last month that every permanent resident or new immigrant aged 18 or above would be given a HK$5,000 (US$644) electronic spending voucher. This handout scheme has attracted thousands of complaints and public anger because Chan has failed to focus on what the public needs.

Compared to cash handouts, voucher formats require higher administrative costs. Handing out the voucher in five instalments means five sets of costs, and the e-voucher scheme is expected to cost HK$600 million in administrative expenses. This is outrageous, given that the government expects Hong Kong to face a budget deficit for at least a few years.

Also, why choose such an inconvenient method for the handout? The government has promised that the voucher would be accepted at as many places as possible, including wet markets. But, for many stallholders, this means the additional cost of setting up e-payment devices, and for the elderly – having to negotiate a payment method that many of them may be unfamiliar with. The authorities may wish to promote e-payment but now is not the right time to focus on it.

Compare this with Taiwan. When it gave out stimulus vouchers last November, people could choose between digital and paper versions, which made them easy to use for all ages. Also, each voucher had to be spent in full, which encouraged people to spend more than the voucher value, multiplying the consumption boost for the economy.