MEMORANDUM ON THE ESTIMATES FOR THE FINANCIAL YEAR 1948/49
PART I PRESENT FINANCIAL POSITION
Financial Year 1946/47.
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The Financial Report for the first eleven months of Civil Administration (1st May, 1946, to 31st March, 1947) has just been issued, and this gives details of the position on the 31st March, 1947. The actual revenue for the period was 882,141,556 against a total recurrent expenditure figure of $85,624,391. Thus, taking into consideration recurrent expenditure only, there was a deficit of $3,482,835. not, however, represent the true position for, after the Estimates had been prepared, it was decided to charge rehabili- tation expenditure to an advance account pending the raising of a loan, and the total so transferred by the 31st March, 1947, amounted to $30,360,747.
This did
The general revenue balance carried forward to 1947/48 amounted to $487,435. This is the difference between the deficit on the year's working of 3,482,835 and a balance of $3,970,270 which was standing to the Colony's credit in London at the time of the Japanese occupation. As this balance was held in London, it did not suffor the fate of the local balances which were confiscated by the Japane se
•
The Estimates for 1946/47 were prepared very soon
after the resumption of Civil Administration and a large element of guesswork necessarily entered into their preparation as the Colony w as faced with completely new conditions and there were no standards of comparison on which costs could be based. Nevertheless, the estimate for recurrent expenditure turned out to be reasonably accurate, the estimate being 890,077,129 against an actual expenditure figure (excluding, of course, rehabilitation expenditure) of $85,624,391. Rehabilitation expenditure was estimated at $77,777,447 but the final expenditure figure of $30,360,747 worked out at rather less than half the original estimate. This was due to the very long delays experienced in obtaining delivery of stores and equipment ordered and to the lack of staff which made it impossible for the programme of works to be carried out as expoditiously as had been planned.
The revenue estimate of $51,308,300 seemed reasonable on the information available early in 1946, but, in the event, actual receipts exceeded this estimate by 30,833,256. This was due to the extraordinarily rapid economic recovery of the Colony, the large influx of population, increases in a number of duties, licence fees, etc. and the introduction of new
revenue measures.
The results of the first eleven months' working of the re-established Civil Government were therefore very much more satisfactory than even the most optimistic would havo ventured to forecast at the time when the Estimates were prepared.
Financial Year 1947/48.
The actual revenue and expenditure for the financial year just ending will not, of course, be known for some timo but the revised estimate of revenuo is $150,146,224, which is $40,306,474 more than the original cstimate. The year 1947 has been a boom year for Hong Kong trado. The original revenue figures were deliberately conservative as it secmod unwise, in view of the unsettled conditions in the Far East, to count