XN000022-1972-03-15 — Page 18

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Wednesday, March 15, 1972

The increase of $280 million, as explained in the Memorandum Note of

the Draft Estimates was due to substantial higher contract prices and several

major projects including the Airport Runway Extension, the raising of the

Plover Cove Dam, the High Island Water Scheme and the Desalting Plant.

"The increased prices of these large engineering projects not only dig

deeply into the public purse they also adversely affect private development,"

he said.

Clearly, Hong Kong was now suffering from high construction costs in the

many capital projects needed to improve and strengthen community services.

Construction Prices

"However, I would point out now as I did in the past that opportunity

had not been taken in the years of low construction prices when the same volume

of work could have been achieved at nearly half the cost.

"The adverse consequences of neglected or inadequate economic, social

and community services are legacy of a deliberate fiscal policy of creating and

amassing huge yearly surpluses," he said.

Mr. Szeto Wai said the Financial Secretary contradicted himself by

saying, in one breath, that "artificial boosting of public expenditure in time

of accumulated surpluses would be at the expense of the present generation of

taxpayers, and in another, that the present generation of taxpayers has contributed

very substantially ($2,000 million without counting the $600 million plus interest)

in recent years to the financial resources for future spending on capital projects."

"Perhaps it is realised that this remarkable contribution was only made

possible by the majority of our people living a very frugal life, in many cases

substandard," he said.

"I therefore