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24
Wednesday, February 24, 1971
SURPLUS OF $162 MILLION NEXT YEAR
No Deficit Despite Large Increase In Expenditure
********
The difference between the draft estimates of revenue and expenditure
in the next financial year produced a surplus of $162 million, but this
was likely to be reduced "substantially"
though not eliminated
certain additional costs were finally determined.
when
Sir John Cowperthwaite, Financial Secretary, told the Legislative
Council today the Government was fortunate in that it could budget for an
unusually large increase in expendituro "without incurring a deficit."
He continued: "I have considered, however, whether I have detected,
in our financial experience, a causal connection, or at least a correlation,
between years of prosperity and increased revenues on one hand, and budgetary
deficits on the other.
"For both our deficits in recent years, that is, in 1959/60 and
1965/66, have come after a series of unusually prosperous years, which
have perhaps led us........into rather more spendthrift ways. There is,
as it happens, a similar correlation, or coincidence, between Salarios
Commissions and deficits."
But he was not "too concerned" about those correlations, in the
short term at least, as Hong Kong remained careful not to allow recurrent
spending to "catch up with recurrent revenues by quite a wide margin."
had frequently stressed the importance of the ratio between them.
He
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