Case Study Three

Despite the huge amount of public resources invested in the Employment Support Scheme, Hong Kong Financial Secretary Paul Chan recently warned that Hong Kong would suffer a record-breaking financial deficit of no less than HK$250 billion and that the unemployment would hover above 6 percent for an extended period of time. He also cautioned against further depletion of Hong Kong financial reserves.

In response to Mr Chans comments, some in the public accused the government of putting money and the interest of capitalists before that of the public by refusing to introduce unemployment protection scheme.

a. What are the merits of the Employment Support Scheme over an unemployment protection scheme? (10 marks)