XN000022-1982-03-25 — Page 9

THURSDAY, MARCH 25, 1982

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HAVING REGARD TO THESE UNCERTAIN PROSPECTS, HE URGED THE GOVERNMENT TO EXERCISE CAUTION AND RESTRAINT DURING THE COMING FINANCIAL YEAR.

HE ALSO SUGGESTED THAT, IF AT ANY TIME IT TRANSPIRES THAT THE FORECAST GROWTH RATE FOR THE GDP OF EIGHT PER CENT IS UNLIKELY TO BE ACHIEVED, THE GOVERNMENT SHOULD CONSIDER SLOWING DOWN THE GROWTH RATE OF TOTAL PUBLIC SECTOR SPENDING TO A LEVEL THAT WOULD BE IN LINE WITH WHATEVER REVISED FORECAST OF GROWTH THE FINANCIAL SECRETARY MAY SETTLE UPON, WHEN HE REVIEWS THE STATE OF THE ECONOMY IN SEPTEMBER.

TURNING TO THE CIVIL SERVICE, MR CHEONG SAID PERSONNEL EMOLUMENTS ACCOUNTED FOR 35 PER CENT OF THE RECURRENT EXPENDITURE IN THE 1982-83 ESTIMATE.

HE WAS WORRIED BY THE POSSIBILITY THAT THE AUTHORITY DELEGATED TO HEADS OF DEPARTMENTS TO CREATE POSTS COULD HAVE BEEN EXERCISED WITHOUT DUE RESTRAINT.

+SINCE THE FINANCIAL SECRETARY HAS ALREADY SAID THAT NONE OF US IS SATISFIED THAT THE MOST EFFECTIVE USE IS BEING MADE OF AVAILABLE RESOURCES', WOULD IT NOT BE REASONABLE FOR THE CREATION OF SOME OF THE 16 500 POSTS FOR 1982-83 TO BE FROZEN, OR AT LEAST NOT FULLY FUNDED, UNTIL SUCH TIME AS THE BULK OF THE CURRENT 15 000 VACANCIES HAVE BEEN FILLED?+ HE ASKED.

MR CHEONG ALSO TOUCHED ON THE GENERAL REVENUE ACCOUNT OF 1982-83.

NOTING THAT CAPITAL ACCOUNT AT $12.6 BILLION REPRESENTS AN INCREASE IN MONEY TERMS OF 21 PER CENT OVER THE REVISED ESTIMATES OF 1981-82, HE DOUBTED WHETHER THE PROJECTED CAPITAL REVENUE OF $12.5 BILLION TO BE DERIVED FROM LAND TRANSACTION CAN ACTUALLY BE ACHIEVED.

UNDER SUCH CIRCUMSTANCES, RECURRENT REVENUE ACCOUNT WILL HAVE TO BEAR AN INCREASING SHARE OF THE BURDEN IN FINANCING THE CAPITAL ACCOUNT DEFICITS IN 1982-83.

→WE CAN OF COURSE AFFORD SUCH DISLOCATIONS IF THEY ARE ONLY OF A TEMPORARY NATURE.

+WHAT WE MUST GUARD AGAINST IS THAT SUCH TEMPORARY PHENOMENA SHOULD NOT BECOME PERMANENT.

+OTHERWISE, IN ORDER TO BALANCE OUR BOOKS IN FUTURE WE MAY HAVE TO RESORT TO SUCH IMPALATABLE ALTERNATIVES AS DEFICIT FINANCING, DIG DEEP INTO OUR RESERVES, OR RAISE REVENUES THROUGH TAXATION, HE WARNED.

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