36
THURSDAY, OCTOBER 8, 1992
QUESTION:
GOOD MORNING MR PATTEN.
HELLO, HOW ARE YOU?
GOVERNOR:
QUESTION:
FROM THE POLICY ADDRESS.
WILL
BE
YOU SAID THAT THERE MORE SPENDING ON EDUCATION, SOCIAL WELFARE, HEALTH ETC. OUR ECONOMY IS DEVELOPING AND OUR GROWTH IS LIMITED AND OUR RESOURCES ARE LIMITED; AND SO, WHEN YOU DRAFTED YOUR POLICY ADDRESS HAVE YOU CONSIDERED ONE POINT, THAT IS, YOUR VAST INCREASE IN EXPENDITURE WILL ACTUALLY BE AT THE EXPENSE OF OTHER THINGS SUCH AS, PUBLIC WORKS. ARE YOU THINKING OF INCREASE OF TAXATION AS WELL?
GOVERNOR:
F
IN
I'VE
AND
THAN
I AM CERTAINLY NOT THINKING OF ANY INCREASE IN TAXATION. I MADE IT ABSOLUTELY CLEAR YESTERDAY THAT I BELIEVE THAT HONG KONG SHOULD CONTINUE TO HAVE LOW AND PREDICTABLE TAXES. NOR AM I PROPOSING THAT THERE SHOULD BE ANY CUT IN INVESTMENT AND INFRASTRUCTURE.
WE
ARE ACTUALLY PROPOSING TO SPEND 78 BILLION ON INFRASTRUCTURE IN THE NEXT FIVE YEARS WHICH WOULD BE 44% MORE THAN THE LAST FIVE. THE REASON WHY WE CAN AFFORD THE PROPOSALS MENTIONED, WHICH WILL STILL LEAVE US WITH A SUBSTANTIAL SURPLUS WHICH WILL STILL MEAN THAT PUBLIC SPENDING IS GROWING LESS FAST OUR ECONOMY - THE REASON WHY WE CAN AFFORD THIS IS FIRST OF ALL, WE'VE BEEN DOING SO WELL THIS YEAR AND HAVE A WINDFALL BECAUSE REVENUES ARE FAR GREATER THAN WE'D EXPECTED AND SECONDLY, BECAUSE ARE PREDICTING GROWTH OVER THE NEXT FIVE YEARS OF 5% IN REAL TERMS YEAR. NOW THAT MAY WELL BE A MODEST ESTIMATE, BUT I THINK THAT WHAT I'VE SET OUT IS PROPOSALS WHICH HONG KONG CAN AFFORD AND WHICH WILL STILL ENSURE, UNLIKE MOST OTHER COMMUNITIES AROUND THE WORLD, THAT WR HAVE A BIG SURPLUS ON OUR ACCOUNTS AND SECONDLY, THAT WE KEEP PUBLIC SPENDING BELOW THE RATE OF INCREASE IN OUR OVERALL WEALTH.
QUESTION:
THAT
OUR
WE
A
MR PATTEN, YOU SAID A MOMENT AGO THAT IN THE NEXT FIVE YEARS THE ECONOMY WILL BE EXPERIENCING SOME GOOD GROWTH AND THERE WILL BE NO PROBLEM, BUT SUPPOSING THERE WILL BE A RECESSION IN HONG KONG AND THERE WILL BE SOME FACTORS OUTSIDE OF OUR CONTROL, WHAT STRATEGY DO YOU HAVE IN MIND?
GOVERNOR:
I SAID YESTERDAY THAT, OF COURSE, THE PROPOSALS AND THE PLANS I SET OUT DEPEND ON US CONTINUING TO HAVE A STRONG AND BUOYANT ECONOMY; BUT WHAT I'VE TRIED TO BUILD INTO OUR PLANS IS A GOOD CUSHION. THAT'S WHY I AM DETERMINED THAT WE SHOULD CONTINUE TO HAVE A BIG PUBLIC SURPLUS. I'M NOT GOING TO MOVE AWAY FROM THAT, IT'S EXTREMELY IMPORTANT. UNLESS WE HAVE A BIG PUBLIC SURPLUS RIGHT DOWN TO 1997 THERE IS THE DANGER, AS YOU'VE SUGGESTED, OF US FINDING OURSELVES, FOR EXAMPLE, IF TRADE FRICTION BREAKS OUT BETWEEN CHINA AND THE UNITED STATES, HAVING TO CUT INTO OTHER PROGRAMMES UNLESS WE HAVE THAT BIG SURPLUS IN THE BANK TO GET US THROUGH ANY DIFFICULT TIMES AND NOTHING THAT I HAVE SUGGESTED IN MY POLICY ADDRESS IS GOING ΤΟ EAT INTO A BIG SURPLUS RIGHT THROUGH THE PERIOD UNTIL 1997.
/QUESTION: GOOD