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"The expenditure ceiling is derived from our long established guideline of keeping growth in spending in line with growth in the economy. A larger surplus does not allow us to breach that guideline. Rather, it provides us with greater scope for one- off investments and for reducing taxes further.
"We have already been quite generous on salaries tax. To go further would have narrowed the tax net. And we have reduced the rates percentage charge to an all- time low."
Moreover, he said, just down the road lay substantial investments in the Railway Development Strategy. And at a time when inflation is nudging up again, a further cut in taxes would send the wrong signals to the economy.
On reserves, Mr Kwong said: "The money has not been thrown away. It still belongs to Hong Kong. It is still ours to use when circumstances require it.
"We realise that expenditure on umbrellas is always regarded as a waste until the rain actually begins. But we must not buy cheap popularity at the expense of the community's long term interests. This year of all years in Hong Kong's history, we must put safety first."
Mr Kwong noted the relative silence of the business community apart from some who hoped for a profits tax cut.
"I have just said that the door is still open. And in a very real sense, this year's Budget is a pro-business Budget.
"We have resisted the calls that arose from some during the consultation exercise last autumn for profits tax to be increased or set on an increasing scale.
"Our headline tax rate is still among the lowest in the advanced world. Our effective tax rates, even after allowing for all the special gimmicks that some other places allow, are still extremely competitive."
He said, in sticking firmly to the principle of prudent public finances, and low and predictable taxes, the Government provided the environment for business to flourish, not just for a year or two, but for decades to come.
"And we are proposing creation of a new unit, within the Financial Secretary's Office, with the specific mandate of looking at Government procedures across the board to ensure that Hong Kong remains the most business friendly place in the world," Mr Kwong said.