The SUN HK : HK govt to pay half of worker’s salaries in new $138b relief package

By The SUN

CE Lam flanked by her key ministers, announces the unprecedented relief package

Chief Executive Carrie Lam has unveiled a massive HK $137.5 billion relief fund to help businesses struggling from the fallout of the coronavirus pandemic.

Part of the fund, or $80 billion, will be used to pay half the monthly salary of an estimated 1.5 million affected workers, up to a maximum of $9,000, for six months starting in June.

But all private businesses that will benefit must make a pledge not to lay off workers.

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Lam also announced that she and her 16 ministers have voluntarily offered to take a 10 percent pay cut for a year. For the chief executive, this will result in her monthly salary falling to $390,000 from the current $434,000.

Lam announced the latest measures to help businesses and residents cope with the Covid-19 crisis at a press conference held at 6pm tonight, Apr 8.

She said the aid package, together with earlier fund relief measures, would cost $287.5 billion, resulting in this year’s budget deficit to surge from $139.1 billion to $276.6 billion, equivalent to 9.5 per cent of gross domestic product.

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But she said these are necessary steps, as the city today reported 25 new Covid-19 cases, raising the total tally to 960.

“In these unprecedented circumstances, the government must have some unprecedented responses – to help businesses to survive, safeguard employment, and minimise the burden on businesses and citizens.”

Apart from the wage support measure, an extra $21 billion will be used to support 16 industries severely affected by the pandemic, including aviation and education-related business like tutorial centers and school bus services.

Lam cited in particular the massive losses suffered by the aviation industry, saying that on Tuesday, only 367 passengers arrived at the Hong Kong International Airport.

Lam noted in particular the heavy losses suffered by the aviation industry

Also part of the relief measures is a 20% discount on MTR fares from July until the end of the year.

The government will also provide help to self-employed people with MPF contributions, but it is mainly one-off support, involving about 215,000 people.

She also said that Hong Kong’s salary subsidy is more generous than in most other states, like Singapore and

Britain

, because it will be given over six months, and is intended more on helping workers keep their jobs.

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The British government said last month that it will cover up to 80 per cent of salaries if companies kept workers on the payroll.

In Singapore, the government has offered to pay 75 per cent of workers’ wages, but only for the month of April, capped at S$4,600 (HK$25,000) per person.

In Japan, the government has announced its largest-ever economic relief package, which includes grants of up to 2 million yen (US$18,350), for small and medium-sized businesses whose revenues had more than halved.

In February, the Hong Kong government unveiled a $30 billion fund from which financial relief was extended to those in the food and retail businesses.