Chief Executive Carrie Lam Cheng Yuet-ngor recently announced a planned third round of economic relief from the Anti-epidemic Fund, which will be submitted to the Legislative Council for approval in September. As the COVID-19 pandemic in Hong Kong is not yet under control, it makes sense to introduce further measures to stabilize the economy and ensure employment. That said, the new tranche of funds should not just complement measures already extended to hard-hit employers; it must also directly help the city’s low-income workers and the unemployed.

Hong Kong’s double whammy of pandemic and political turmoil has created an urgent need for the government to create a safety net for society with a sound and efficient unemployment subsidy plan as its basis.

The third outbreak of COVID-19 infections has taken a toll on the catering industry. In addition to having to pay regular expenses such as rent and staff wages, restaurants lost revenue due to the ban on evening dine-in. The reduction in their procurement of food items has in turn exerted pressure on the income of wholesalers. As the pandemic is unlikely to go away in the near future, the catering industry will continue to feel the pinch. As a result, it is imperative that the third round of relief funds focuses on supporting the catering industry.

The first rounds of relief went to employers, who promised not to dismiss their employees for a period of time. This was meant to be a short-term solution for small- and medium-size companies. Unfortunately, the current economic landscape worldwide indicates that the economic recession in Hong Kong will not end in the near future. If the situation continues to deteriorate, some employers may not be able to sustain their business and will be left with no choice but to lay off staff. By then, securing employment will become another damp squib. Therefore, the government must come up with a long-term plan to tackle this lasting issue.

Many trade unions, stating that the pledged allowances might not be handed directly to the grassroots wage earners, recommended a new round of cash distribution to benefit the employees in the hardest hit industries in the pandemic. Such a suggestion sounds viable, as the previous universal cash handout measure has left us a ready-made government-to-banks cooperation mode that can distribute any amount of cash directly to those in need.

If the relief goes directly to employers, some ill-minded ones might take advantage of it for personal interests. Therefore, the plan demands a strict monitoring mechanism to plug any loopholes. The actual operational costs involved might exceed those in 

previous cash subsidies. As such, the special administrative region government has sound reason to turn down the seemingly practical but potentially unaffordable plan.

Hong Kong has no unemployment subsidy plan to shelter those who might be desperately in need. There is no better time than now to take the initiative to mend the ineptness in safeguarding the livelihood of the deprived population through a well-planed unemployment subsidy plan in our free market economy. This definitely demands wit and wisdom, but these have always been the best traits of our people in Hong Kong.

In the past, the government offered a logical explanation on not offering any subsidy to the jobless workforce, 

saying that the subsidy might be wrongly treated as an incentive for the employers to fire employees at the expense of their social or moral obligations. But since the pandemic hit the city and the world early this year, this line of logic has been taken to task as global economic activities have ground to a halt for months. A large number of employees now can be categorized as the “invisible unemployed” because they are taking unpaid leave for unlimited periods, while others have had their salaries reduced.

Even with government subsidies, beneficiary companies can still go bankrupt because of the sustained economic recession, throwing their employees into joblessness. Without government unemployment benefits, the dismissed would have no help.

Hong Kong witnesses an increasing number of industries affected by the pandemic. Tourism, retail, convention and exhibition, and the film industry have all been hit. The sweeping economic recession will be so overwhelming that the government’s short-term remedy for bailing out the employers will be no more than slapping a Band-Aid on a lethal wound.

Then, the spiking unemployment rate will cancel out the effectiveness of the solutions that once worked well. Even with cooperation between employers and their staff and mutual understanding between landlords and their tenants, such goodwill will be insufficient to drag the city out of the severe economic recession. Then, the SAR government will need to figure out a long-term subsidy scheme both for the livelihood of residents and the economic recovery as a whole. In this regard, the government should take the initiative to introduce a feasible unemployment subsidy scheme in advance before it is too late.

Hong Kong’s double whammy of pandemic and political turmoil has created an urgent need for the government to create a safety net for society with a sound and efficient unemployment subsidy plan as its basis. Otherwise, the government’s promises to achieve social recovery will be reduced to lip service that disappoints everyone.

“Together, we fight the pandemic” is more than an appealing slogan; it is a set of effective and resolute solutions to benefit all and relieve the needy. The SAR government should prove to the stakeholders, employers and wage earners that by standing with the people in Hong Kong, it will walk tall though all kinds of trouble.

The author is a political commentator and columnist. 

The views do not necessarily reflect those of China Daily.