349
36
HONG KONG LEGISLATIVE COUNCIL
HONG KONG LEGISLATIVE COUNCIL
350
37
means represent the whole of the Colony's interest in trade with Japan, for direct shipments between Japan and certain neighbouring countries, which are not reflected in the Trade Returns, are financed through the open account maintained by this Colony with S.C.A.P.
This increased trade activity is also reflected in the ship- ping figures, which went up from a total of just under 20 million tons of shipping, entering and clearing in 1948, to just over 23 million tons in 1949. The number of passengers using the airport also increased from 250,000 in 1948 to 320,000 in 1949, despite the fact that there was a considerable falling off in the last four months of the year, with the cessation of operations in China. Much the same story is told by the Railway figures. The total number of passengers carried in 1949 was 4 millions, an increase of nearly 30 per cent. over the previous year. Actually there was a decrease of close on a million of the through passengers carried, consequent on the cessation of through services to Canton in the middle of October. But this decrease in through passengers was more than made up by an increase of 2 millions in the number of local passengers, in that they travel by local train to the frontier, which they then cross by foot and get in another local train on the other side of the border. The net result is that our railway revenue doesn't suffer, but it is the unfortunate traveller who is inconvenienced. Thus it always is, that in times of disturbance the innocent pays the price. It is interesting to note that this railway of ours, which is only 22 miles long, is now carrying more passengers than any other colonial railway system, including that of East Africa which is nearly 3,000 miles long,—with the single excep- tion of Nigeria.
Needless to say this prosperity is much to be welcomed, but as I asked last year, what of the future? Twelve months ago we looked forward to the ensuing months with subdued hope, but no real certainty. We therefore considered that it would be wise to be reasonably conservative in our budgetting. That was clearly the correct policy, even though in the upshot our estimates proved to be faulty. If at any time the future is uncertain, as it was a year ago and as it still is, it would be folly to take a chance, especially for Government which has the responsibility of caring for the taxpayers' money. Governments must, in my opinion, be cautious where finance is concerned. There are already indications that the receipts from some of the more lucrative sources of revenue are falling off.
That may be only temporary, but it may not. We don't really know. But we should rightly be accused of foolhardiness if we were to ignore the signs.
The Estimates of Revenue for 1950/51 have therefore again been framed on reasonably conservative lines, and, on the present bases of taxation, show a figure of $191,979,480. Against them must be set $199,051,037 for the Estimates of Expenditure, which have been framed on economy lines with no frills. The two together produce a deficit of $7,071,557.
It would be most imprudent of us to budget for a deficit on the year's working if we can possibly avoid it. There are four ways in which this gap could be closed. The first would be to step up the Estimates of Revenue, but this I do not regard as entirely honest, and were there to be a business recession, revenue would fall off seriously and we should be letting ourselves down with a bump. The second would be to cut expenditure even further. If there were a real emergency we should have to do this, but, as I have already indicated, the estimates of expenditure have been pruned, and as Honourable Members are aware, there are many urgent and necessary things that don't appear in the Estimates at all. We want more schools, more medical facilities, more markets, to name but a few. A drive, too, over some of the secondary roads in Hong Kong and Kowloon which are full of pot holes, should convince the sceptical that there is a great deal, a very great deal, still to be done in the Colony. Are we to pile up the burden indefinitely on future years by deferring an even greater number of urgent works? I should strongly deprecate this. Moreover, there is an undeter- mined liability-the matter is still being discussed with London-regarding our share of the cost of reinforcements, a liability which we must in honour assume. I should add that this is separate and distinct from the question of a military contribution in normal times. The third way would be to draw on our reserves, but these are not large, and should only be drawn on if there were no other reasonable alternatives. The fourth way of bridging the gap is to increase taxation. Taxa- tion I regard as an evil. Admittedly an unavoidable evil, but in the case of Hong Kong we have to be especially careful, for we know that if we overdo it we shall drive business away to neighbouring places. Admittedly we have advantages that these places have not, but there comes a point where traders will say that the price of operating in Hong Kong is too high. We have to strike the happy mean. Taking all these factors into consideration, Government has decided that the gap should be bridged by increased taxation, but not to such an extent by a long way as will kill the goose that lays the golden eggs. I shall leave it to the Financial Secretary later this afternoon to explain what those measures are. They will, I am quite sure, not do damage to our economic structure.
To revert once again to the past year, although trade and commerce as distinct from industrial production is our main economic activity, there has been an increase in industries, especially in the light metal industries. The textile industry too has further developed with the establishment of new cotton and woollen yarn mills. Employment returns in registered factories and workshops, which now cover some 140 different industries, show an increase of nearly 18,000 over last year's figures and now aggregate 81,000 including 31,000 women. A total of some 260 Trade Unions have now been registered, with a declared membership of nearly 148,000. Labour disputes of any magni- tude have fortunately been few and, except in the case of the recent 44-day stoppage of the trams, have not caused any serious
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