1. Provide comprehensive incentives such as significantly increasing tax deductions for children, offering universal childcare services, and extending maternity leave to make it easier for parents to have and care for children. 2. Broaden family planning guidance from solely focusing on birth control to also promoting healthy families and raising awareness of population aging issues to encourage thoughtful consideration of childbearing. 3. Launch a slogan creation competition to understand current expectations around childbearing and develop messaging that resonates with today's needs, whether encouraging more births or promoting self-sufficiency with fewer or no children.

1. Solving the
economic challenges
of population aging
in contemporary
Hong Kong
Members:
Au Wai Lun
Wong Tsz Wai
Kevin
Thomas

2. Content
1. “Population aging” in Hong Kong
2. Causes of “Aging population”
3. Induced economic challenges of aging
population
 Medical
 Social welfare
 The overall economic prospect
4. Solution?-----Conflicting views
5. Our suggestions

4. Definition of Population Aging
According to World Health Organization
(WHO):
1. When population aged 65 or above ≥ 7% of the total
population
2. When population aged 65 or above ≥ 14% of the total
population

5. Current Situation in HK
According to “The Profile of Older Persons, 2006”
published by Census and Statistics
Department:
“Over the past 45 years, the proportion of older
persons (aged 65 or above) in the total
population rises from 2.8% in 1961 to 12.4% in
2006.”
Hyper-
Aging Aged
aged
society society
society

6. Future Population Trend in HK
Refer to the “Projection of Population Distribution”
and “Hong Kong Population Projection” published by
Census and Statistics Department:
“In 2019, population of older persons will jumped
from 890,000 in 2009 to 1,320,000 in 2019 (13% to
17.2%)”
“In 2039, the proportion of the population aged 65
and over is projected to rise markedly from 13% in
2009
to 28% in 2039”

8. Two main factors (1)
1. Low birth rate
 Higher divorce rate
 Higher child-raising cost
 Changed mindset (family  individual)
 Extended first birth age
 Increased woman participation in labour market
 Lower infant mortality

9. Two main factors (2)
2. Long life span
 Improved health care services
 Improved social welfare
 Improved social condition

11. Social welfare challenges
 Medical and Health Services for elderly
1. Community Support Services for the
Elderly
2. Residential Care Services for the Elderly
3. Old Age Allowance
4. Health Care Voucher
5. Public Housing
6. Senior Citizen Residences Scheme

12. 2012–13 Government expenditure
 Government expenditure for 2012–13: $44
billion ,about 30% used for elderly
 Allocate $900 million to improve quality of
250 district elderly community centers
 Additional 1,000 subsidized residential
care places
 Public transport concessions for the
elderly and eligible people

13. Services for Elders
 In the 2012-13 Buget, Financial provision
for services for Elders has increased for
5%($170.8m to $ 179.4m)
 Threes new services
1. Enhanced Bought Place Scheme
2. Discharge Support Programme for
Elderly Patients
3. The pilot scheme

14. Old Age Allowance
 HKD 1,090 /month
 Expenditure about 3.9 billions in 2008, 4.4
billions in 2014-15 in prediction
 In 2033, 2.1 millions of elderly people,
about 28% of total population
 Money for Comprehensive Social Security
Assistance and Old Age Allowance

15. Housing Burden
 67% of total population of elderly live in
public housing in 2010
 Senior Citizen Residences Scheme is
carried out because of the increasing need
of house.
 With the increasing land price, the
economic challenge would be really hard
for government

16. Brief Summary
 The rate of increasing number of aging
citizen keep accelerating
 With the increasing need of Support
Services , Old Age Allowance, Health Care
Voucher, the money use for elderly may be
doubled or tripled.
 The tax may not afford the burden of these
needs.

17. Medical
 Expenditure of Hospital Authority
 Reasons that population aging cause medical expense
increase
└ Chronic disease↑
└ In-patients Staying↑(病人日數)
 Health Care Voucher

18. Expenditure of Hospital Authority
 90% of incomes comes from government
 HKD39.9 billion 2011-2012 for Medical (17% of recurrent Government
expenditure, 27% in 2033)
 Expenditure prediction
 2011 - 2012 39.9 billion
 2012 - 2013 45.0 billion (+8%)
 2032 - 2033 186.6 billion (+367.6%)
Two main Expenditure (09-10)
 Staff costs (26.7 Billion, about 73%)
 Drugs + Medical supplies and equipment (HKD4.4 Billion, About
12%)
Source: Hospital Authority Statistical Report

19. Reasons that population aging cause
medical expense increase
• The amount of the drugs expands have obvious increase.
(2012 – 2013 Inject $10 billion into the Samaritan Fund )
• About 90% of the old people rely on the public medical
service (50% of Hospital Authority expense)
• 72% old people are Chronic Illness
• Chronic disease
• Drugs Expensive (Samaritan Fund for Drug Items)
• Number of In-patients Staying about 50% is aged 65↑
• Old people have increased and will have a great increase
in year 2019 (13% to 17.2%)

20. Health Care Voucher
Aims
 To provide financial assistance for the elderly to choose
the most suitable medical service. ($250@year, near 0.5
billion/year) (2012-1-1 $500@year, doubled)
Requirements
 Age 70↑, have HKSAR ID Card
Definite date
 From 09-1-1 to 11-12-31 (First trial)
 From 12-1-1 to 14-12-31 (Second trial)

21. Overall economic prospects

22. Burden on next generation
 In 2033, the elderly (aged >65) will
account for 27% of total population Cf.
13.2% currently
Source: Census and Statistics
Department
 Increase proportion of aged pop. ( retired)
 Increase burden of working pop.
( nearly every 4 labours support 1 elderly
ppl.)

23. Slow down in economic growth
 Gross domestic product (GDP) , a main
measure of level of production (econ.
growth) of a region.
Labour population in 1996, 2001 and 2006 - By Age Group
1996 2001 2006
Age No. % No. % No. %
15 - 24 462 885 14.5 444 244 12.9 433 746 12.1
25 - 34 1 011 015 31.8 953 725 27.7 912 351 25.5
35 - 44 910 170 28.6 1 066 020 31.0 999 188 28.0
45 - 54 504 866 15.9 701 551 20.4 878 393 24.6
55 - 64 232 173 7.3 218 462 6.4 288 960 8.1
65+ 61 388 1.9 53 990 1.6 59 746 1.7
Total 3 182 497 100.0 3 437 992 100.0 3 572 384 100.0
Source： Census and Statistics Department

24.  GDP growth greatly depend on working
population
 proportion of elderly people
 Relative in working population
 Slowdown in GDP growth
E.g. During 2025-2050, GDP growth in USA,
Japan and Europe is expected to fall by
1.5%, 0.6% and 0.5% respectively source: John
Mauldin – www.hjej.com

25. Shrinking tax revenue
 proportion of elderly
 relative in working population
 in salary tax revenue
人口金字塔
Population Pyramid
二零零一年年中
年齡組別 (基準) 二零一六年年中 年齡組別 二零三一年年中
Mid-2001 年齡組別 Mid-2031
Age group (Base) Age group Mid-2016 Age group
85+ 85+
85+ 男性 女性 男性 女性 男性 女性
Male Female 80-84 Male Female 80-84 Male Female
80-84
75-79 75-79
75-79
70-74 70-74
70-74
65-69 65-69
65-69
60-64 60-64
60-64
55-59 55-59
55-59
50-54 50-54
50-54
45-49 45-49
45-49
40-44 40-44
40-44
35-39 35-39
35-39
30-34 30-34
30-34
25-29 25-29
25-29
20-24 20-24
20-24
15-19 15-19
15-19
10-14 10-14
10-14
5-9 5-9
5-9
0-4 0-4
0-4
400 300 200 100 0 100 200 300 400 400 300 200 100 0 100 200 300 400 400 300 200 100 0 100 200 300 400
千人 千人 千人
Thousand persons Thousand persons Thousand persons
外籍家庭傭工
Foreign domestic helpers

26.  Tax revenue as the base of public cost
(e.g social welfare for the elderly,
infrastructure…)
Example: ~ 90% operation cost of the public
hospitals is subsidised by SAR
government Source: Hospital Authority Statistical Report 2009
– 2010
 aged population  demand for long-
term care service  gov. expenditure
 In the long run, gov. expenditure may keep
falling short of its revenue

28. 1. Broaden the tax base by
introducing GST
Purpose: to maintain budget balance and the quality of
public elderly services
Government supports the idea
 In 2006, Financial Secretary Henry Tang Ying Yen said “……..
the rapid ageing of Hong Kong's population will be accompanied by
higher spending pressures on healthcare and services for the aged……..
the introduction of a GST (Goods and Service Tax) is a viable option for
Hong Kong. This would secure the long-term sustainability of our
revenue base and our capacity to meet public expenditure needs.”

29. 1. Broaden the tax base
However, The Democratic Party(民主黨), League of Social
Democrats (社民連), the tourism and retailing sector all
oppose the idea because
- The living of citizens will become more difficult
- GST will degrade the business environment of HK

30. 2. Encourage birth

31. 2. Encourage birth
 The Democratic Party and The Family Planning
Association of Hong Kong do not support the idea
 Member of The Democratic Party, Lo Chi Kwong said,
“…….Population aging is an irreversible progress. Therefore, it is
better for us to focus on solving the accompanied economic
challenges rather than increasing the birth rate.” (Suggestions of The
Democratic Party on population policy, 2006)
 The Family Planning Association of Hong Kong:
 Having children or not is a personal decision
 Quality > Quantity

32.  學者籲連串優惠鼓勵生育
 學者和專業團體普遍認為單靠政府鼓勵市民生育作用不大，應提供全面優惠政策，包括大幅提高子女免稅額、提供全面託兒服務、延長產假等，
讓父母安心照顧子女。 隨香港出生率低見0.94（每名婦女一生中生育0.94名子女），香港家庭計劃指導會家喻戶曉的「兩個夠晒數」經典口號，
或已完成其歷史任務，面對逐漸浮現的人口老化危機，「生定唔生﹖」已經不再是個人選擇這麼簡單。為了掌握現今男女對生育的期望和理想，家
計會特別舉辦標語創作比賽，不論是「擁抱香港，繼續生育」，還是「唔生仔，靠自己」，只要被視為切合今日需要，便有機會贏取冠軍萬元獎
金。
 過去三十年以「兩個夠晒數」為節育口號的家庭計畫指導會亦要適應轉變，由節育改為健康輔導，公開徵求反映市民生育意願的標語，藉此讓市
民反思生育和人口發展的問題。
 家計會即日起至下月六日舉行網上標語創作比賽。家計會發言人表示，七五年推行「兩個夠晒數」家庭計畫運動，是要紓緩人口急劇膨脹問題，
但目前情況已經不同，希望透過標語創作及其後一系列運動，讓市民作出反思。查詢標語比賽詳情，可致電25722222。
 對於政府鼓勵市民生育，社區組織協會主任何喜華指出，德國為鼓勵生育和製造就業機會，產假長達一年半，育有三名子女的家庭更獲巨額津貼，
港府可以倣效。
 香港稅務學會理事王銳強亦指目前子女免稅額對鼓勵市民生育的吸引力不大。他建議子女免稅額由目前每名子女三萬元，倍增至六萬元，減輕市
民稅務負擔。
 不過，香港大學社會社工及行政學系 授周永新認為，市民擔心養育下一代支出十分高昂，單靠減稅亦難以刺激市民生育意欲，反而每年約有一萬
名內地人士在港出生，但他們大部分返回內地定居，政府應想辦法令他們在港居住。
 身兼家計會理事會委員的港大統計及精算系高級講師葉兆輝指出，現時香港的生育率已跌至只有0.94，可謂是全球生育率最低的地區，就連新加
坡和日本，在加緊催谷生育後，生育率已升至1.2至1.3。葉兆輝坦言，香港的生育問題，「已經不再是個人選擇咁簡單」，要在社會責任中取一個
平衡，「就如上班工作一樣，若每個人都說我有錢，不用工作，整個社會人人不上班，社會的經濟活動怎能推動呢﹖」
 港大統計及精算學系高級講師葉兆輝亦對政府鼓勵生育的成效表示懷疑。他說，就算每對年輕夫婦生育三名子女，也只能將本地出生率由目前的
零點八提高至一點二，遠低於理想中的二點一。
 香港人力資源管理學會外務總監吳克儉表示，出生率低和人口老化，均嚴重影響本港未來人力資源，但除鼓勵生育，人口素質亦很重要，政府應
加快和簡化審批內地及外地專才來港的程序。
 行政會議成員兼立法會議員陳智思亦指出，香港出生率偏低，加上人口逐漸老化，十至十五年後本港勞動人口會出現短缺，政府應放寬輸入內地
專才。他說，隨本港與內地文化及經濟日漸融合，當局長遠宜摒棄限制兩地人流自由往來的政策，讓有條件的專才來港發展。他認為，若未來數
年持單程證來港的內地人士持續下跌，當局可調整名額數量。
 陳智思以紐約及倫敦為例，指該兩個城市都不會設置邊界將人流「綁死」，有能力者會繼續住在城市，中產及退休人士則遷往生活水平較低的郊
區。他說，不少本地人擔心內地專才來港「搶飯碗」，但其實輸入專才反而可製造更多就業機會。

33. 3. Extend the retirement age

34. 4. 設立全民退休保障計劃

35. Medical reform

36. 5. Attract youthful immigrants
Purpose: young population, maintain or even enhance
quality of workforce  market
competitiveness
 Gov. support the idea:
first introduced Quality Migrant Admission Scheme in
2006, further modification has been made in 2007
 Nicole Alpert: a research associate for The Lion Rock Institute
1. “The Lion Rock study makes an important point: ``For resource-poor city-
states like Hong Kong, Singapore, Dubai and Shenzhen, human resources are
probably the only resource that can render their economic growth sustainable.”
2. “Even with immigration, we cannot “escape” an aging population and its
transformation of society - migrants age too - but open immigration policies will

37. Opposing views
 Mr. Ma Kwok-ming, Lingnan University part time lecturer
Immigration of mainland talents  more intense competition among
work force
 Helen Chan Wing-mui, Assistant Director of Immigration
“We want to protect our local graduates, not increase competition for them.”
 Leslie Kwoh, The Standard
“Illustrating the disadvantages of such an arrangement, however, the
scheme has come under fire in recent months for allowing thousands of foreign
workers to come into Australia at below-market rates while many local
graduates still struggle to find work.”

38. Universal Retirement Protection
http://www.info.gov.hk/gia/general/200604/26/P200604260315.htm
 Offender:
 government -- 現時偏向反對 (2008)
 以下為Secretary for Health, Welfare and Food York
Chow Yat-ngok四月二十六日在立法會會議上就「全民退
休保障」動議辯論的發言(partial): 全民退休計劃經驗證明是
有一定的原則及持續的問題，需要考慮是否可以維持。我們
對這個建議有很大的保留，政府亦不會貿貿然推行全民退休
保障，對這課題，我希望議員小心處理。
http://www.takungpao.com/opinion/takungpao/2011-04-
 學者 29/762779-2.html
 (城市大學副教授，博士--曾淵滄, Dept of Economics
HKUST 雷鼎鳴 Francis T Lui) http://francis-lui.blogspot.com/2011/04/blog
 Supporter:
 Alliance for Universal Pensions， League of People
Power Albert Wai-yip Chan ， League of Social
Democrats Kwok-hung Leung…
http://www.inmediahk.net/taxonomy/term/500644/0

39. Our suggestions
1) Import foreign medical staff
2) Increase places of tertiary education
3) Provide more incentives to encourage
parenthood
4) Encourage retirement in Mainland China
5) Enhance open immigration policy
6) Well allocation of resources

40. 1. Import foreign medical staff
 Follow our Asian neighbour – Singapore
 import of foreign medical servants (e.g.
nurses, health assistants or even doctors)
 Reduce burden of local medical staff in
public hospitals
 Maintain quality of public medical service

41. 2. Increase places of tertiary
education
 places of government-funded tertiary
education programmes ( esp. degree
prog.)
 Maintain and enhance competitiveness of
local workforce amid contemporary
knowledge-based economy
 Well- educated labours are essential
human resources in H.K. !!!

42. 3. Provide more incentives to
encourage parenthood
 Offer more economic lure to encourage
citizens to give birth to babies
 one-off tax allowance of new born babies
family
 continuous subsidy for children-raising
 setting up babies care centers… etc.
 Fertility rate

43. 5. Enhance open immigration policy
 Focus on attracting relatively young
workforce from worldwide
 By focusing on age limit – let say introduce
bonus points in 15-30 age category
 By offering incentives to young
immigrants-e.g. housing allowance,
 Encourage them to settle down ( Morgan
as an successful case)

44. Babies of non-local parents
 Government: Automatically giving babies of non-local
parents permanent residency
 A spokesman for the Labour and Welfare Bureau: By
2018, Hong Kong will have about 300,000 postwar baby
boomers who have retired. Many of these vacancies will
not be filled as the city's birth rate has been decreasing at
an increasingly alarming speed since the 1970s.
 A government manpower study: Hong Kong's workforce
will be too small to power its economic growth by 2018
because of an ageing population,

45. Babies of non-local parents
 Citizens: oppose the idea
 Non-local parents are not tax payer but they
Occupy the resources of Hong Kong Citizens
 Culture conflict between Citizens and people
from mainland China
 Chance of Babies of non-local parents taking
their parents to come to HK in many years later

46. Well Allocation of resources
 Joyous Living scheme  waste of
resources
 Provide its residents with a relaxed
ambience, continuing professional
healthcare and skilled care services
 Target customers : Rich elderly
 Over ten thousand management expenses
/ per month
 More resources should be used for helping
the poor old people.

47. Extend the retirement age
 Extend the entire age from 65 to 70
70
Labour Force Participation Rate
64.3
62.8 61.4
60
50
percentage
40
30
20
14.1
9.8
10 7.2
0
1991 1996 2001
Older Persons Whole Population
Source: Elderly Commission

48. Extend the retirement age
 USA - being gradually raised to 67 years
old
 Japan – 69 years old
 Korea - 67 years old
 Flexible or part-time work arrangements
for older persons
 Retire age depends on work type
 Would not block the advancement of
younger workers, while retaining valuable
insight and expertise for the employer