TNAG-1641-FCO40-2288-Budget-of-Hong-Kong-1987 — Page 171

11.2.87

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I have

higher than expected growth rate achieved in 1986 and what we now foresee for 1987, I consider that a limited upward revision of the growth rate assumption is needed. therefore adopted a medium range planning assumption of 5 1/2%. Inevitably, in some years the actual growth rate

will be higher, and in others it will be lower.

overall trend that is important.

It is the

39.

As an

Any public sector has a tendency to grow. American journalist once said, "Government expands to absorb revenues and then some.". In Hong Kong, however, we have sought to contain the relative size of the public sector by limiting expenditure growth to within the trend growth rate of the economy. This remains our guiding principle. In 1985-86 the actual growth rate in

consolidated account expenditure was 2.7% and is forecast

to be 4.1% in 1986-87. Taking these two years together, the growth in expenditure is within the growth rate of GDP.'

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