XN000022-1989-05-10 — Page 15

WEDNESDAY, MAY 10, 1989

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BUDGET STRATEGY CORRECT FOR HK

THE

FINANCIAL SECRETARY, THE HON PIERS JACOBS, LEGISLATIVE COUNCIL TODAY (WEDNESDAY) HE REMAINED CONVINCED STRATEGY HE HAD ADOPTED IN THE 1989-90 BUDGET WAS THE RIGHT HONG KONG.

TOLD THE THAT THE ONE FOR

WINDING UP THE DEBATE ON THE SECOND READING OF THE APIROPRIATION BILL 1989, MR JACOBS SAID HE CAME TO SUCH A CONCLUSION AFTER LISTENING CAREFULLY TO THE DEBATE AND HAVING HEARD AND READ A VARIETY OF COMMENTARIES BY OUTSIDE OBSERVERS.

HAD TO HE NOTED THAT I HAD SAID IN HIS BUDORT SPEECH THAT RE RECONCILE THREE KEY FACTORS; INFLATION: THR ACCUMULATION OF LARGE SURPLUSES; AND THE NEED FOR A MAJOR PROGRAMME OF INFRASTRUCTURAL WORKS.

"IN SO DOING, 1 RECOGNISED THE DEGREE OF CONFLICT THESE FACTORS AND SOUGHT TO ACHIEVE A BALANCE. HE SAID.

INHERENT IN

OF ALLOCATION ON THE SPECIAL PLEAS BY MEMBERS THAT THE

FUNDS TO VARIOUS WORTHWHILE CAUSES BE INCREASED, MR JACOBS SAID HE WAS AWARE THAT TO HAVE DONE SO WOULD HAVE INCREASED THE INFLATIONARY PRESSURE ON ALL SECTORS OF THE COMMUNITY, INCLUDING THE SANDWICH CLASS.

"IN MY VIEW, THAT WOULD HAVE BEEN IRRESPONSIBLE," HE COMMENTED.

BY

HAD

URGING

MR JACOBS SAID THAT IN RELATION TO HIS OVERALL STRATEGY HE BEEN TAKEN TO TASK BY A MEMBER FOR CONTRADICTING HIMSELF RESTRAINT ON PUBLIC EXPENDITURE ON THE ONE HAND WHILE STILL PROPOSING MAJOR SPENDING ON THE INFRASTRUCTURE ON THE OTHER.

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"THE KEY HERE IS THE TIMING, HE SAID.

MR JACOBS SAID IF WE WERE TO EMBARK UPON SUBSTANTIAL HE ADDITIONAL EXPENDITURE THIS YEAR ON THE KIND OF PROJECTS TO WHICH HAD REFERRED IN HIS BUDGET

AN SPEECH, THIS WOULD INDEED HAVE

HIS OVERALL INFLATIONARY EFFECT AND THUS RUN CONTRARY TO

POLICY OF

NOT FUELLING INFLATION.

ON

TIME, AND "BUT SUCH CAPITAL WORKS REQUIRE A CONSIDERABLE LEAD WHILE

ACTUAL SPENDING I THINK IT PRUDENT TO EARMARK FUNDS NOW, ANY SCALE WILL BE AT LEAST TWO YEARS AWAY," HE EXPLAINED.

WAS MR JACOBS ALSO SAID HE

GRATEFUL TO THE SENIOR MEMBER,

AND SPEECH.

TO OTHER THE HON ALLEN LEE, FOR HIS THOUGHTFUL OPENING MEMBERS WHO SPOKE FOR THEIR MANY USEFUL COMMENTS, AS WELL AS THE USUAL LEAVENING OF CONSTRUCTIVE CRITICISM.

ALL MATTERS RAISED WOULD BE CAREFULLY REVIEWED IN ORDER TO WHETHER ANY FOLLOW UP ACTION WAS NEEDED, HE ADDED.

SEE

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