TNAG-1641-FCO40-2288-Budget-of-Hong-Kong-1987 — Page 177

11.2.87

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52.

The outcome of our present budgetary strategy is

shown in the Medium Range Forecast (15). The Forecast

indicates an average annual surplus over the remainder of

the forecast period of consolidated revenue over

expenditure of some $1.5 billion per annum (16). I regard

this as no more than a reasonable cushion, which must be

seen in the light of an aggregate of consolidated revenue

and expenditure exceeding $100 billion in each year.

Clearly, relatively small percentage changes in either

revenue or expenditure could have a major impact on the

residual surplus.

(15)

Appendix C.

(16)

Although the year 1989-90 shows a small forecast deficit this is after allowing for a further equity injection into MTRC. On current projections this further equity may not be needed but is retained on the grounds of prudence.

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