Hong Kong to use 21 indicators to define poor after dropping income metric

Hong Kong will measure the size of its poor using a new 21-indicator framework, abandoning the previous income-based metric said to have overestimated the number of underprivileged people by ignoring billions of dollars spent on public housing and healthcare.

In a 224-page report released on Thursday, the government also raised the concept of “social transfer values” for the first time, referring to how much income a family effectively gains by not having to pay full price for public services.

No 2 official Eric Chan Kwok-ki said the document was a report card of Hong Kong’s efforts to combat poverty.

“With rapid societal shifts, the needs of the underprivileged are constantly evolving and poverty-alleviation policies must be adaptive to ensure support is precisely targeted,” said the chief secretary, who also leads the Commission on Poverty.

“In the past, we only used household income to measure poverty, which caused a distorted picture of the situation … which ended up impacting our judgments on priority and resource deployment, and failed to answer the question of who needs help, preventing us from prescribing the right remedy.”

Beginning in 2013, authorities defined the poverty line as 50 per cent of median household income before policy intervention, with a detailed report released annually.