End of levy to alleviate burden on middle class families: Leung
Chief Executive Leung Chun-ying denied at the Legislative Council on Thursday an allegation by a unionist legislator that abolition of the foreign maids’ levy would pave the way for the importation of foreign labor.
Leung described the measure as intended to help the middle class families who employ foreign domestic helpers. Leung said in his inaugural Policy Address on Wednesday that the foreign domestic helper (FDHs) levy would be abolished when the suspension of collection expires on July 31, 2013, to ease the burden on families employing FDHs. The measure will cost the government about HK$1.5 billion a year in lost revenue.
The Commercial Organization and Domicile Services Employees Association, a group of local domestic helpers opposed the measure, charging abolition of the levy would encourage more employers to recruit FDHs and take away employment from local workers.
Chairwoman of the association Chow Kwai-ying said, “The job vacancy for domestic helpers in 2012 was about 600 fewer than in 2011, showing the difficulty of finding jobs for local domestic helpers”.
Chow said salaries for FDHs would be lower than what is paid to local domestic helpers, so employers would be more likely to consider recruiting foreign workers. She also estimated that 10 to 20 percent of local domestic helpers would turn to other jobs or industries, because of the abolition of the levy. The group demanded the government provide incentives and preferential treatment to employers who employ local domestic helpers.
The FDHs levy imposed from 2003 to 2008 required employers to pay HK$400 each month for each two-year contract for FDHs. The levy was intended to fund the training and retraining of local employees.
The government decided to suspend the obligation on employers of all imported labor, including FDHs, for a period of five years, from Aug 1, 2008 up to July 31, 2013 to relieve the burden on middle-income families hiring FDHs.
The fund for retraining now has risen above HK$2.3 billion, capable of supporting Employees’ Retraining Board operations until 2015, a source said.
Joseph Law Kwan-din, chairman of the Hong Kong Employers of Overseas Domestic Helpers Association, welcomed abolition of the FDH levy. He contended the position taken in opposition to abolition of the levy by local domestic helpers is illogical.
“The abolition of the FDH levy does not affect the employment of local domestic helpers. They are two different kinds of work, belonging to two different markets. The local domestic helpers do part-time jobs and do not reside at the employer’s home, while FDHs must stay in the employer’s house,” he said.
Hong Kong TKI Association, an organization providing service for Indonesian domestic helpers, said there was a debate when the FDHs levy started in 2003 and abolishing it is a wise choice, adding this is a win-win policy.
