16.
The need to support the present administration's far reaching social programmes has recently led to a change away from Hong Kong's traditional economic policies. In last year's Budget the Government introduced deficit financing and gave notice that tax increases were to be expected in the future.
Corruption
17.
During my meeting with the Governor last December, Sir Murray expressed satisfaction with the progress made by the Independent Commission Against Corruption (ICAC). He said that it had established itself with the public and was now not only responding to complaints but taking the initiative in investigating corruption.
18.
While such progress is being made by the ICAC, we see no reason to appoint a Commission of Enquiry into corruption in Hong Kong.