For discussion FCR(97-98)75
on 5 December 1997

ITEM FOR FINANCE COMMITTEE

HEAD 173 - STUDENT FINANCIAL ASSISTANCE AGENCY
New Subhead "Travel subsidy for primary school pupils"

Members are invited to approve the creation of a new Recurrent Account subhead to provide travel subsidy to needy primary school pupils aged below 12 who attend public sector schools outside their residing Primary One Admission Nets, with effect from the 1998/99 school year.

PROBLEM

The existing student travel scheme is not available to needy primary school pupils aged below 12 who need to travel a relatively longer distance to attend school. This has caused financial difficulties to some families.

PROPOSAL

2. With the support of the Secretary for Education and Manpower, the Controller, Student Financial Assistance Agency (C,SFAA) proposes to introduce a travel subsidy scheme for primary school pupils aged below 12 with effect from the 1998/99 school year.

JUSTIFICATION

3. About 12.5% of the pupils in public sector primary schools (or about 53 600 pupils in the 1997/98 school year) now attend schools outside their residing Primary One Admission (POA) Net¹ . With an expected large number of school-aged children arriving from the Mainland in the next two years, the supply of school places from within their residing POA Nets are unlikely to be able to satisfy the demand. The Director of Education therefore expects that the number of pupils attending schools outside their residing POA Nets will further increase up to about 14.6% by the 2001/02 school year.

4. These students need to travel to and from school using various means of transport. In the absence of any travel subsidy, some families may have financial difficulties in meeting the travel expenses of these pupils. We need to provide a new travel subsidy to help them overcome such difficulties. Under the proposed scheme, a pupil will be eligible for subsidy if -

1. he passes a means test;

2. he attends a public sector primary school outside his residing POA Net; and

3. his school is beyond ten minutes?walking distance from his residence.

5. Under the existing Student Travel Scheme (STS) which provides travel subsidy to eligible students aged between 12 and 25², successful applicants receive a subsidy for home-school travel during term time at the rate of half the average adult fares on public transport between the applicant's residence and the location of his school. C,SFAA considers that the same level of subsidy would be appropriate to meet the needs of the primary pupils attending schools outside their residing POA Nets. As the level of subsidy under the STS is determined on the basis of a fare matrix developed and updated by the Transport Department from time to time, C,SFAA proposes to determine the level of the proposed subsidy for primary pupils on the same basis.

FINANCIAL IMPLICATIONS

6. C,SFAA estimates that about one-third of the pupils attending public sector schools outside their residing POA Nets would satisfy the criteria in paragraph 4 above.

7. Based on the projected enrolment of public sector primary schools for the 1998/99 school year and the estimated average rate of subsidy, C,SFAA estimates that the cost of providing the new travel subsidy would be $22.7 million in 1998-99, calculated as follows -

8. Subject to Members?approval, we will include the necessary provision in the 1998-99 draft Estimates.

BACKGROUND INFORMATION

9. At present, the STS provides travel subsidy to full-time students aged between 12 and 25 who have not completed their first degree, who pass a means test and who live beyond ten minutes?walking distance from their school. Recently Members have approved an expansion of the ambit of the scheme to cover full-time students aged above 25 starting from the 1998/99 school year.

Education and Manpower Bureau
November 1997

1 --POA Nets are for allocation of primary 1 pupils to schools within reasonable walking distances from their homes. At present, there are 59 POA Nets.
2 -- The STS will be extended to eligible students aged abover 25 from the 1998/99 school year.
3 -- C, SFAA has assumed a take-up rate of 33.63% on the baiss of the take-up rate of the Stuent Travel Subsidy Scheme for secondary students.
4 -- $1,228 is the average rate of susidy under the exisiting STS under which the applicants are subject to the same means test as under the proposed scheme.

---