Wed, Dec 07, 2011 - Page 8 News List

Promoting a fairer welfare system

By Edward Wu 吳明儒

The pan-blue and the pan-green camps have recently been in heated discussion over the issue of fairness and justice in raising the subsidies for elderly farmers. In particular, opposition politicians question the sudden decision by the government to raise the monthly subsidy by NT$1,000 (US$33.09) instead of NT$316, as the Cabinet had originally proposed.

The proposal put forward by the Chinese Nationalist Party (KMT) and its pan-blue allies to raise eight other kinds of welfare allowances along with the elderly farmers’ subsidy met with public approval. Above and beyond party political considerations, how should the public view this issue?

In sociological terms, the farmers’ subsidy belongs to the category of social allowances and subsidies, meaning one doesn’t have to pay an insurance premium to receive the allowance as one would under a social insurance scheme. As is the case with other kinds of welfare subsidies for the disadvantaged, the subsidy for elderly farmers is paid for by the public.

The allowance for senior farmers has been adjusted four times since its inception. That being the case, it is reasonable to consider raising other social subsidies at the same time. That includes support for children and youth in mid-to-low income families, which has not been adjusted for 18 years; the allowance for elderly people with mid-to-low incomes, which has not been raised for 16 years; and the subsidy for physically and mentally handicapped people, which has remained unchanged for 17 years.

The categories of disadvantaged people eligible for welfare payments include elderly people, children and youth, students and Aborigines living in households with low or mid-to-low incomes, mentally and physically disabled people, and recipients of various kinds of payouts from the National Annuity program, adding up to nearly 2.18 million people altogether.

The cost of living has risen over the years, so the subsidies allocated to these people are no longer sufficient. The KMT wanted to establish a system for periodic adjustments of these welfare benefits, and accordingly proposed raising the subsidy for elderly farmers by NT$316, based on the 5.27 percent increase in the consumer price index (CPI) in the past four years since the allowance was last adjusted in 2007. However, the proposed figure provoked a backlash from legislators from predominantly farming constituencies.

If a 5.27 percent raise were applied across the board to other disadvantaged groups, it would fail to take into account the longstanding problem of too many different standards for benefit payments to various groups of needy people.

For example, the subsidy for children and youth from mid-to-low income households is about NT$1,400 to NT$1,800 per month. About 115,000 children and teenagers receive this subsidy. The problem is the standard for this allowance has not been adjusted for 18 years, during which time the CPI has gone up by 29.11 percent. If the allowance were adjusted in one go based on the CPI increase, it would be raised by NT$500 (actually 31.21 percent to get a round figure), so that payouts would be in the range of NT$1,900 to NT$2,300. If, on the other hand, the child and youth subsidy increase were to be calculated in accordance with the CPI increase of 5.27 percent over the past four years, then it would only go up by NT$84, thus failing to meet the purpose of really helping the disadvantaged.

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