About 1.5 million Hong Kong workers will have up to HK$9,000 of their monthly wages paid for by the government under a HK$137.5 billion (US$18 billion) package to help businesses and residents through the Covid-19 crisis.
Revealing the massive relief deal on Wednesday, Chief Executive Carrie Lam Cheng Yuet-ngor said HK$80 billion would fund a six-month wage scheme launching by June and open to Hong Kong’s entire private sector, with individual payments capped at 50 per cent of salaries. The employers receiving the lifeline must pledge not to lay off workers, she added.
Lam said the package, together with other recent pledges of financial relief, would cost HK$287.5 billion, causing this year’s budget deficit to surge from HK$139.1 billion to HK$276.6 billion, equivalent to 9.5 per cent of gross domestic product. “We have to try our best to prevent the closure of businesses or large-scale job cuts,” she said as the number of confirmed Covid-19 cases in the city reached 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.
Lam and her 16 ministers had voluntarily agreed to a 10 per cent pay reduction for a year, the chief executive told the press conference. The HK$137.5 billion deal, which was given the green light by her Executive Council earlier in the day, is equivalent in size to 4.8 per cent of the city’s GDP.