TNAG-2470-FCO40-3594-Budget-of-Hong-Kong-1992 — Page 138

시

Ра

ale. 1992 Budget

Mr Cox

Mr Ricketts

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Reference

Нита Тоорх

un

as 'x'. to get involved

I think we must rely on Hong Kong to let us know

Proposal in advance of any dramatic from such If we set a very bad precedent in budgetary fine tuning. If we have a view that at 'y' we send feed it in

HONG KONG BUDGET SPEECHES (But

1.

such as

for

well ahead of the budget.

stone is right to flag the issues.) Woono

Paragraph 2 of Hong Kong telnos 159 and 33 (both the Financial Secretary and the Governor seem to have written) indicate that we will be lucky to receive a copy of the budget speech before it is actually read. Much will depend on the speed of the bag and the bag room tell me it takes "2-5 days".

2. I am almost certain that we received a secret fax copy of the budget speech last year (or the year before) but I can find no evidence of it on either the 1991 or 1990 files. Thus, what Hong Kong are proposing, would seem to be in line with previous practice, certainly as revealed by the file.

3.

-

As you will be aware, the Secretary of State is responsible to Parliament for the good Government of dependent territories. He is "through his powers in respect of legislation, the ultimate regulator and guarantor of the probaty of .... public finance" political volume 2 part 1 of DSP. In some ways therefore it is unsatisfactory that we have no sight of the budget before it is made. Hong Kong of course has a high degree of autonomy in its financial matters and there is no way I would wish to suggest that we try to claw this back. However, it may be an area that we need to watch. For example, if Hong Kong were under severe pressure say huge outflows from the Civil Service - and therefore decided to hike Civil Service salaries by 25% (I should be so lucky!), we might wish to consider the long term financial implications of this before such an announcement was made.

4.

I do not wish to start any hares running but you may wish to have at the back of your mind that circumstances could arise in which we would wish to be aware of at least the broad outline of the budget. For example we might wish to be reassured that real Government expenditure would not increase by more that X%.

Mital vstane.

261ü

11 V Stone

Hong Kong Department

WH 304 270 2651

25 February 1992

CODE 18-77

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れ

M

My Shone Noted .2712

Mr

Mvs is right Hat we should watch

#fis.

To je fair, Ff and Ky young

have give

a

Pretty

s. Brodbeit feel for the main lines

main lines of the

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Ludget.

No

Gother action

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