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1. I chaired a meeting of the planning group on Hong Kong 11 November. The minutes will be submitted later this week, but in view of recent developments in Hong Kong and the expected visit of the Governor to London next week, the Minister may care tohave a few comments on the situation.
2.
Social Progress. The Hong Kong Government's achievements in fulfilling the targets set out in the planning paper has been impressive, but there are a number of outstanding problems:
a, Social Security
We shall be discussing the position with Mr Heppel the expert from DHSS who has been advising the Hong Kong Government. Our main concern at this stage is faster progress towards an effective non means tested scheme for unemployment benefit and old age pensions, whether contributory or not.
b.
Budget and Taxation
The Hong Kong tax situation continues to be non-redistributive.
The argument that there is ample tax revenue to meet current public expenditure requirements suggests that present plans for increasing public expenditure are too conservative. The attitude
in Hong Kong seems to be to estimate revenue and then decide
on expenditure rather than determine policies and then decide how to finance them through revenue. A recent report by the World
Bank has made the same argument forcibly.
c. Education
Progress is good and plans are impressive as far as the
provision of school places is concerned, but it might be useful to get an independent view from one or more DES inspectors of schools on the quality of education in Hong Kong.
CONFIDENT IAL
13.
No comments yet.
Private notes are available after approval.