Covid cash subsidy has two left feet
Hong Kong is probably the only place in the world to pay people directly for testing positive to the coronavirus. And the cash prize of HK$5,000 is truly generous. Britain mulled a similar idea but did not proceed with it. Perhaps it was because the government had in place a furlough scheme...
Monday, November 23, 2020
Hong Kong is probably the only place in the world to pay people directly for testing positive to the coronavirus.
And the cash prize of HK$5,000 is truly generous.
Britain mulled a similar idea but did not proceed with it.
Perhaps it was because the government had in place a furlough scheme subsidizing 80 percent of the wages of employees forced to stay at home without work during lockdowns.
The scheme, which should have ended by now, was recently renewed until early next year.
Hong Kong's Health Secretary Sophia Chan Siu-chee said the HK$5,000 subsidy was meant to ease people's fears of losing income should they test positive for Covid-19.
But the idea is riddled with moral hazards.
The most urgent issue now facing Chan's colleagues at the Centre for Health Protection must be the so-called dancing cluster which, after other clusters in previous waves, is responsible for many of the cases in the latest Covid surge.
If Labour and Welfare Secretary Law Chi-kwong acts quickly to thrash out details of the incentive, those from the dancing cluster who test positive will get the HK$5,000 - even if they have no symptoms.
I'm sure many people will think this sounds like a lucky cash prize.
The moral hazard is not that people will deliberately pull down their masks or do other stupid things to expose themselves to the virus in the hope of contracting it to get HK$5,000.
It is that, while the majority of the population has been exercising great caution to avoid contacts, others like the dancers stand to be rewarded for carrying on dancing and prancing between partners to spread the virus.
The irony is that, while the honest guys suffer, the bad guys are rewarded.
The fact that Chan announced the cash scheme despite this irony reveals a lack of government confidence that her mandatory orders will ever force to the surface everyone in the dancing cluster or other groups yet to be designated.
It is meant to be a carrot-and-stick approach. Without the carrot, the stick alone - including fines on the first instance and probable imprisonment subsequently - may not only be resisted but could even invite a degree of backlash from society.
With the offer of a cash payout - which is half the amount of Financial Secretary Paul Chan Mo-po's HK$10,000 cash budget handout for every adult citizen - officials are hoping that people will be more willing to come out of hiding to take the test. If they fail to do so, they will face fines and jail.
Will the strategy succeed?
We won't know if the bait will be effective, but we do know that we have reached an embarrassing point.
While it is known that various vaccines are in the pipeline, they may not be available soon enough to preempt the resurgence of the virus this winter.
The health secretary should have at least indicated to us when Hong Kong will get delivery of its first batch of vaccines.
Meanwhile, let us all adhere to social distancing for the time being.