Budget policy
I have no intention of dis-
here cussing
any of the particular issues raised in
with
the conversation Government, except one. The single criticism I have made publicly in Hongkong related to the Government's bud- getary and taxation policy. I will say nothing of the hash of my com- that was made
ments, but confine myself to explaining my point of view. Incidentally it is a comment, and not "advice", which has not been asked for and would carry but slight weight with those more experienced in the peculiarities of Hongkong.
son
If
For ten years Hongkong budgeted for deficits, and in nine of those years achieved surpluses. Now it budgets to achieve a surplus. The rea- deficits that estimated become actual surpluses is not because Hongkong has discovered some miraculous budgetary principle un- known to lesser breeds. you arrive at your estimation of a deficit by allowing for minimum revenue and maxi- are expenditure you highly likely to achieve surplus. In some years Hongkong has had an up- surge in revenue, in others there has been underspend- ing, and in most there has been a combination of both.
mum
Caution
a
This cautious policy is justified by the assertion that "it has worked." So it has, if financial criteria have an overwhelming predominance in budgetary thinking. My doubts centre around whether it will continue to work. That was my meaning in mentioning "Gladstonian finance."
I have an enormous ad- miration for the late Mr Gladstone, but he was pro- posing the abolition of the British income tax, when Imperial Germany was con- sidering old age pensions. There can, in short, be too much of a good thing. Pro- vided young Chinese, born in Hongkong, are immune to the "revolution of rising ex- pectations," caution will al- ways pay. Hongkong knows best the truth of this matter, and I do not say my argu- ment is right. I only
say that there is an argument.
E
My point relating to taxa- tion is simple. I prefer an incomes tax to a salaires tax, not as a revenue raiser, especially in times of surplus, | \ but because it is more equitable and gives less room for evasion. Again Hongkong).
knows best how much equity.
it can afford.
There
of is
course no
virtue in debt, and I am very aware of the careful plan- the of
Hongkong ning Government and the scope of Tempera- private charity.
mentally,
I would prefer
more dynamism in planning within the spheres of social
welfare
Planning
because
and education.
there must be, the Government cannot start disbursing money is re- hurriedly if it feels ceiving too much. Especially in those fields which would create no additional adminis- trative charges I would go faster.
Admiration
I shall return home with a great admiration for Hong- kong and a determination to do the little I can to justify her position in the UK. The intellectual calibre energy, and integrity of the Hong- kong Government is obvious. So is the dynamism of Hong- But the kong business life. impression I shall never lose is of the courtesy, good humour, diligence and lust to
of the survive
ordinary Chinese. Hongkong is lucky in her citizens, and they de- the fruits of the economic miracle which they have built. It is for us in the UK to help where we can, and do no harm where we ¡cannot.
serve
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