Constitutional protection of social welfare rights in Hong Kong

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My recent post “Kong Yunming v The Director of Social Welfare: Constitutional protection of social welfare rights in Hong Kong” on Oxford Human Rights Hub provides a summary of the Court of Final Appeal (“CFA”) case of Kong Yunming (孔允明) v The Director of Social Welfare (FACV No. 2 of 2013), the judgment of which was handed down on 17 December 2013:

On 17 December 2013, the Court of Final Appeal of Hong Kong unanimously allowed the appeal of Madam Kong in Kong Yunming v The Director of Social Welfare (Kong). Kong, an applicant for Comprehensive Social Security Assistance (CSSA), was married to a Hong Kong permanent resident who died one day after she arrived in Hong Kong on a One-Way Permit (OWP) in 2005. She became homeless after her late husband’s public housing unit was repossessed. In 2006, the Director of Social Welfare (the Director) rejected her application for CSSA, as she did not meet the seven-year residence requirement (the Requirement). She sought judicial review on the basis that the Requirement contravened inter alia arts 25, 36 and 145 of the Basic Law.

The CSSA scheme was a means-tested social security scheme. The scheme originally had a one-year residence requirement, which remained until 2004 when the Requirement was introduced. This Requirement, however, did not apply to minors or where the Director’s discretion applied. The OWP scheme was devised to help reunite Mainland and Hong Kong family members, especially children of permanent residents. The Court declared the Requirement unconstitutional, restoring the former one-year requirement.

The CFA reversed the original and appellate decisions, and declared the Requirement unconstitutional; restoring the former one-year residence requirement. The CFA judgment contains critical analyses about the constitutional protection of social welfare rights in Hong Kong. Read with art 145, art 36 protects present rights and associated rules derived from the previous social welfare system (“System”), including the one-year condition. It provides the framework for a constitutionally protected right to social welfare. Administrative schemes, such as the CSSA scheme and its predecessor, warrant art 36 protection. Ribeiro PJ gave the majority decision (with Ma CJ, Tang PJ and Lord Phillips of Worth Matravers NPJ in agreement), which found that although the case below concentrated on the right to equality before the law and protection against discrimination, the final appeal focused on the right to social welfare. In particular, the majority decision grappled with the nature of social welfare rights under art 36 of the Basic Law; the legitimacy of the aim of the Requirement; and the alleged systemic mitigation of the Requirement’s hardship. Bokhary NPJ provided a separate concurring decision, examining the case from an equality perspective.

Majority decision

Ribeiro PJ held that the Director side-stepped the pertinent issues of the case and failed to address the constitutional obligation to uphold the right to social welfare. The Requirement was an unjustifiable contravention of the right to social welfare. In essence, the Director claimed that the Requirement aimed to curb public expenditure. The argument was that, without the Requirement, the financial sustainability of the System would be jeopardised by: an increased number of welfare applicants generated by the OWP scheme and the ageing population of Hong Kong; and the general growing expenditure on CSSA.

Maintaining the sustainability of the System should be a legitimate aim. However, the Director was held to have failed to establish a rational connection between the Requirement and the sustainability rationale. Even if a rational connection were established, based on the government’s statistical evidence, the Requirement was “manifestly without reasonable foundation”, given its contradictory policy consequences and modest benefits. The reasons were three-fold:

  • The Requirement was incompatible with the family reunion policies of the OWP scheme. Exemption from the Requirement applied to minors. But, parents of such minors, who are reuniting to be their caretakers and who have passed the means test, still could not obtain CSSA benefits until the Requirement was met (or unless the Director’s discretion applied). Many new arrival mothers faced financial hardship and could not find suitable employment due to their lack of qualifications and their child-rearing commitments.
  • A rational response to an ageing population should involve encouraging the entry of young immigrants to rejuvenate the population. Again, the government had exempted minors from the Requirement, but not their reuniting parents. With respect to the elderly, the savings resulting from the adoption of the Requirement were minimal.
  • The expenditure on CSSA across the whole scheme has increased sharply between 1994 and 2004. Although the government was justified in setting policies to curb expenditure, it should implement them through rational measures. There was no suggestion that CSSA claims by new arrivals merited any special attention. There has also been no evidence as to the savings achieved by the Requirement.

Different benefits should attract qualifying periods appropriate to the particular benefits. For example, public housing must depend on the stock available, and a shortage may attract long qualifying periods. It would be nonsensical to impose residence requirements simply to achieve symmetry. In 2002, 95% of new arrival CSSA recipients were women, and the trend has continued. They were likely to be indigent mothers who had little or no capacity for employment. Their contribution to society was to help rejuvenate the ageing population, integrate right of abode (“ROA”) children into the community, and avoid the socially destructive consequences of split families. It would be arbitrary and unreasonable to exclude them from CSSA benefits. Similarly, an indigent person who was genuinely unable to work could not be expected to contribute economically by the imposition of the Requirement. The long-accepted principle has been that social welfare is the government’s responsibility to be met by public funds. Interestingly, Ribeiro PJ noted that the Requirement originated from a long-term population policy study, rather than a specialist social welfare review. His Lordship conjectured that that might explain why the Requirement’s threat to fundamental social welfare values was not properly recognised.

The Director advanced three proportionality arguments to show that hardship flowing from the Requirement could be mitigated:

  1. the Requirement was widely publicised on the Mainland to deter potential indigent new arrivals;
  2. new arrivals, if denied CSSA, could rely on charities for help; and
  3. the Director’s discretion might be exercised in exceptional cases.

Ribeiro PJ found that none of the arguments qualified as reasonable mitigation. The government has avowed to respect the rights of ROA children, and to promote family unity and immigration and integration of young Mainland children to rejuvenate the ageing population. Many indigent immigrants are potential beneficiaries of the OWP scheme. Targeted deterrence of indigent new arrivals should contradict government policies. Charities might supplement but could not substitute CSSA. Moreover, the exercise of the Director’s discretion is subject to stringent conditions. Kong’s circumstances evidence the difficulties faced by applicants for a waiver. The death of Kong’s husband was not deemed a “substantial and unexpected change in circumstances beyond her control” (one of the conditions of the discretion).

Minority decision

The decision of Bokhary NPJ provided an interesting study on equality jurisprudence in Hong Kong. The Requirement excluded non-permanent residents from the right to social welfare, even though the right applied to all residents without distinction. Art 24 of the Basic Law guarantees equal constitutional protection for all residents in Hong Kong. Similarly, art 36 applies to Hong Kong residents generally. Bokhary NPJ acknowledged that different parts of the Basic Law engage the rights of residents and non-residents differentially. But, the Requirement’s disparate treatment of different classes of residents against the face of a constitutional guarantee was unjustifiable by “any standard of review, test or approach”. The Requirement represented disproportionate means to save public money, and was therefore illegitimate discrimination of a constitutional right.

Impairment of the right to social security severely impacts the dignity of indigent persons. Jurisdictions with established traditions of constitutionalism should embrace a pervasive set of values that inter alia address socio-economic rights. The Requirement contravened arts 2 and 9 of the ICESCR, the provisions of which art 39 and arts 36 and 145 of the Basic Law aim to implement. The increase of the residence requirement was an unwarranted retrogression in respect of addressing basic needs. Art 145 mandates the government to develop the System that existed before 1997, and it must protect this baseline. There might be scope for suspending the development of social welfare in exceptional socio-economic situations, but no such situation had arisen.

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