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Now, we have to remember that this is a very exceptional year:
a year of transition, a year in which we are worried about the inflationary pressures which I mentioned, and we are quite anxious to make sure that the SAR Government will come into being with a very robust financial position, and that is the reason why we are rather cautious.
And we have looked at the expenditure programme, the expenditure programme for the coming few years. On the railway strategy alone, as I explained in the Budget Speech, will almost wipe-out completely the surplus I am forecasting during the next three years. So in other words, whatever surplus we have or whatever fiscal reserves we have at the moment, is unlikely to grow substantially during this period. So I believe we have struck the right balance.
Reporter (in Chinese): Mr Tsang, LegCo members almost managed to reach a consensus that your forecast of a $32 billion surplus for 97/98 and when they asked you to allocate $300 million in addition in order to support the CSSA you rejected. Why is it that you cannot allocate $300 million out of the $32 billion?
Mr Donald Tsang (in Chinese): We have to separate the two things. The surplus is a one-off surplus whereas the expenditure in question is a recurrent expenditure. And concerning expenditure, on previous occasions I am sure you must have heard from Mr Kwong that when it comes to expenditure our policy is well known. The expenditure growth is more or less equal to the trend growth rate of 5%. If we are to spend more then it would exceed this indicator, exceed this guideline.
Now, for individual items it is difficult to say on what items should we spend more and on what items should we spend less. Now you are talking about welfare. In the past five years the real term increase is over 88% so you can see that we are already investing very heavily in welfare services. Under these circumstances, should we invest more, should we spend more? Of course it would be better if we spent more. However, because the pie is only so large, if we spend more on welfare we must take away from other areas. And so we have to strike a balance.
At present 10% of our spending goes to welfare and members of the public really have to consider, have to ponder whether or not we should spend even more on welfare. And if we spend more on welfare does it mean that we spend less on law and order, does it mean we spend less on education?
Reporter (in Chinese): Mr Tsang, about the five-year forecast. Up to 2001, every year the surplus is about 10% growth. In the next five years the fiscal situation will be very healthy. Given the circumstances, why is it that in terms of welfare expenditure you cannot increase it more?