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» NESLAY, DECEMBER 11, 185
AS FINANCIAL SECRETARY, HE SAID, HE COULD NOT COMMENT ON THE TAX IMPLICATIONS UNTIL THEY COULD BE QUANTIFIED IN CASH TERMS. EXTREME CAUTION WAS NECESSARY BECAUSE THE WORLD WAS LITTERED WITH DECENT PUBLIC MEDICAL INSURANCE SCHEMES, THE MATHEMATICS OF WHICH HAD PROVED UNSOUND.
+THERE IS, I SUGGEST, LITTLE FISCAL DIFFERENCE BETWEEN A COSTLY NEW SCHEME AND ONE WHICH REQUIRES MAJOR TAX ABATEMENT FOR A PRIVILEGED NUMBER. WE NEED TO SEE THE TOTAL PLUSES AND MINUSES. AS A GENERAL OBSERVATION, IN A LOW TAX ADMINISTRATION LIKE HONG KONG THERE IS NOT MUCH SCOPE FOR MORE THAN A FEW SPECIAL TAX PRIVILEGES OR CONCESSIONS, HE SAID.
AS FOR POSSIBLE BANKING REFORMS, SIR JOHN SAID HE SHARED THE OVERALL OBJECTIVE - THE ENHANCEMENT OF HONG KONG'S REPUTATION AND STANDING AS ONE OF THE MAJOR FINANCIAL CENTRES OF THE WORLD.
EXPRESSING PLEASURE AT THE UNOFFICIALS' AGREEMENT THAT IT WAS, AND REMAINED, THE RIGHT DECISION TO LINK THE HONG KONG DOLLAR WITH THE U.S. DOLLAR, HE SAID +NOTHING IS PERFECT- BUT THE LINK IS WORKING WELL AND I HAVE NO INTENTION OF CHANGING IT.+
ACKNOWLEDGING THAT THERE WAS NEED TO ENSURE THAT THE COMMISSIONER OF BANKING HAD ADEQUATE RESOURCES TO IMPLEMENT ANY REFORMS TO PRUDENTIAL SUPERVISION THAT MIGHT BE PUT TO, AND APPROVED BY THE COUNCIL, HE SAID IT HAD TO BE RECOGNISED THAT IT WOULD TAKE TIME TO BUILD UP THE NECESSARY EXPERIENCE AND EXPERTISE - A FACTOR WHICH PLAYED A PART IN THE INTENTION TO PHASE IN ANY NEW ARRANGEMENTS OVER A SIGNIFICANT PERIOD OF TIME.
ON THE QUESTION OF THE PROVISION OF LIQUIDITY TO THE BANK ING SYSTEM, HE SAID ARRANGEMENTS EXISTED WHEREBY THE LARGER BANKS WOULD IN CASE OF NEED ASSIST SOUNDLY MANAGED SMALLER BANKS WHICH HAD TEMPORARY LIQUIDITY PROBLEMS.
IF FOR SOME REASON THE LARGER BANKS WERE UNABLE OR UNWILLING TO ASSIST IN A PARTICULAR INSTANCE, IT WAS ALWAYS OPEN TO AN INDIVIDUAL INSTITUTION TO DISCUSS THE SITUATION WITH THE SECRETARY FOR MONETARY AFFAIRS.
IF THE MATTER STILL COULD NOT BE SATISFACTORILY RESOLVED. HE WOULD BE PREPARED TO CONSIDER ASSISTANCE BY THE EXCHANGE FUND, PROVIDED THAT THE CIRCUMSTANCES WERE SUCH AS TO PERMIT USE OF THE FUND'S RESOURCES. BUT IT MUST NOT BE ASSUMED THAT THE AUTHORITIES WOULD RESCUE A BANK OR ITS SHAREHOLDERS FROM THE CONSEQUENCES OF STUPIDITY, MISMANAGEMENT OR FRAUD, HE SAID.
+OUR INTEREST IS IN THE PROTECTION OF DEPOSITORS AND THE INTEGRITY OF THE SYSTEM. IT SHOULD BE OBVIOUS THAT PUBLIC MONEY
THE CANNOT BE ENTRUSTED TO INCOMPETENT OR FRAUDULENT MANAGERS. FINANCIAL SECRETARY IS RESPONSIBLE FOR THE EXCHANGE FUND, RESPONSIBILITY WHICH I TAKE VERY SERIOUSLY INDEED, + SIR JOHN SAID.
/AS FOR