XN000022-1973-03-28 — Page 4

- 2

-

Wednesday, March 28, 1973

A fuller and better life for the people of Hong Kong, he added, was dependent, to an unusual extent, on the attainment of a higher material standard

of living.

"This in turn depends on the growth rate of the economy and on the careful and imaginative use of those resources appropriated for the public services and public works programmes."

Mr. Haddon-Cave believed that, in general, the aim must be to allow expenditure to grow in line with the trend in rising revenue and no faster." He disagreed with the contention that the growth rate of expenditure was not being maintained and pointed out that if supplementary provisions in 1973-74 were on a similar scale as in the current financial year the budgeted increase in expenditure would be 27 per cent.

If achieved, this would be the largest increase for 20 years.

Capital Expenditure

"The reserves we are now accumulating," he went on, "will be available

to help meet capital expenditure in future years, They will also help to ease the results of any unforeseen temporary fluctuations in revenue."

The Financial Secretary reiterated that there was abundant evidence that Hong Kong's developing policies would prove very expensive in future.

Taking up a plea that there should be no cuts in spending on education in the event of a recession in the economy, the Financial Secretary said the fact was that expenditure on education would continue increasingly to dominate Government spending.

"Where precisely the axe would fall must depend on the cause of the recession in revenue and the demands of other public services," he explained.

While