financed from general revenue unless those individual
businessmen who sustained losses as a result of errors of
judgement not of their own making were prepared to finance
those losses.
44.
So I, personally, would need powerful arguments to
be persuaded that the policy of leaving the commercial decision-making process to individual businessmen, a policy which has proved to be remarkably successful in achieving a steady growth momentum, should now be abandoned; and that certain cost inputs should be subsidised from, and trading losses underwritten by, general revenue. In other words, as I said at greater length when winding up last year's and this year's budget debates (16), I remain quite unconvinced that the arguments so far adduced in favour of lessening our
reliance on the market mechanism to allocate resources
efficiently and in favour of lessening our faith in the free enterprise system are in the least compelling.
45.
(b) Fiscal policy
Consistent with our determination to maintain our
policy of not becoming involved in the detailed direction of the economy, despite Mr. Allen Lee's plea that "the Government should attempt to guide industry to diversify in the correct direction rather than to let (businessmen) proceed on their own as in the past", our tax system is designed, inter alia, so as to be as neutral as possible as regards the internal cost/price structure and investment decisions. Further to this, the basic principle of the pricing policies we adopt for Government-owned and operated public utility undertakings is that consumers are charged the full cost of the resources consumed by each undertaking unless conscious policy decisions dictate that this policy should be modified.
(16) C.S., 1977, paras. 44-50 and C.S., 1978, paras. 53-58.
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/46.
As