40
FINANCIAL SYSTEM AND ECONOMY
therefore comprises, apart from the General Revenue Account, expenditure by the Urban Council and the Housing Authority, expenditure financed from certain statutory funds, and expenditure on public works projects financed with loans from the Asian Development Bank. Expenditure by institutions in the private or quasi-private sector is included to the extent it is met by government subventions, but not included is expenditure by those organisations in which the government has only an equity position, such as the Mass Transit Railway Corporation.
The Urban Council, operating through the Urban Services Department, draws up its own budget and expenditure priorities. This expenditure is financed mainly from the Urban Council rates and from fees and charges for services provided by the council. In 1981-2 the council's expenditure totalled $979.4 million, and for 1982-3 the council's budgetted expenditure is $1,263.9 million.
The Housing Authority, operating through the Housing Department, is also financially autonomous. Its income is derived mainly from rents. Where cash flow is inadequate to meet the construction costs of new estates, the authority borrows from the Development Loan Fund on concessionary terms. The authority is provided with land at nil premium, but the value of the land is shown in the authority's balance sheet as a government contribution. In 1981-2, the authority's recurrent expenditure totalled $1,273 million, of which $152 million was financed from the General Revenue Account for such activities as squatter control and the management of temporary housing and industrial areas. For 1982-3 the authority's budgetted recurrent expenditure is $1,852 million, of which $198 million will be met from the General Revenue Account. At March 31, 1982, the outstanding loans borrowed by the authority from the Development Loan Fund for the construction of estates amounted to $4,599 million, and this is expected to increase to $7,095 million by March 31, 1983.
The statutory funds included in the public sector comprise the Home Ownership Fund, the Development Loan Fund, the Lotteries Fund, the Student Loan Fund and the Capital Works Reserve Fund.
The Home Ownership Fund finances the cost of land and the construction of flats for sale under the Home Ownership Scheme. The Housing Authority is the government's agent for the design, construction and marketing of these flats. The fund was initially established by a transfer from the General Revenue Account, and derives its income from the proceeds of sales of the flats. In 1981-2, total expenditure from the Home Ownership Fund amounted to $1,054 million, and budgetted expenditure for 1982–3 is $993 million. The Development Loan Fund is used mainly to finance social and economic develop- ments including, in particular, loans to the Housing Authority for the construction of public housing estates. Transfers are made from the General Revenue Account to the fund to meet the loan requirements of the Housing Authority. Otherwise the fund's income is derived from interest payments and capital repayments. In 1981-2, total payments from the Development Loan Fund amounted to $2,138 million, and budgetted payments for 1982-3 amount to $3,276 million.
The Lotteries Fund is used to finance the development of social welfare services through loans and grants. It derives its income mainly from a share of the proceeds of the Mark Six Lotteries. In 1981-2, total loans and grants made available from the Lotteries Fund amounted to $34 million, and estimated loans and grants in 1982-3 amount to $113 million. The Student Loan Fund is used to finance loans to students of the two universities, the Hong Kong Polytechnic and other approved post-secondary institutions, and to Hong Kong students studying in the United Kingdom. Transfers are made as necessary from the General Revenue Account to the fund to enable the fund to meet its commitments, the