12. Finally on the reserves, let me make it very clear that I do regard the level of reserves in the forecast as adequate. I have no hidden agenda to build up the reserves even higher. Nor should the increase in profits tax be seen as the start of a trend provided, of course, that my other revenue proposals are accepted.
13.
There has also been speculation that the main reason for keeping what some regard as a high level of reserves is because we expect large increases in our expenditure on the Airport Core Programme. This is not the case.
AIRPORT CORE PROGRAMME
14.
The process of updating and revising the financial aspects of the Airport Core Programme (ACP) has now been completed. The details have been supplied to the Airport Committee and will be explained to the relevant Legislative Council ad hoc panel and the Airport Consultative Committee tomorrow. We will also be releasing the information to the public.
15.
I will not attempt to summarise the quite lengthy and complicated arrangements here. For the purposes of the Budget, it is sufficient to note that the costs to be borne by the Government remain in line with previously published figures. These costs are also in line with those included in the Medium Range Forecast attached to my Budget Speech.
16. A number of Members have called for tight financial control of the ACP. We believe we are achieving this with the planning and cost management procedures which have been introduced. Moreover, three quarters of ACP contracts will be on a fixed- price lump-sum basis, so the risk of cost overruns can be minimised. Of course, funds for the ACP will need to be considered by Finance Committee. And in response to Members' own requests, we shall be briefing the ad hoc panel, and later Finance Committee, as a background against which they can assess more detailed proposals for funding individual projects.
EXPENDITURE
17.
Even with our commitments for the ACP, let me repeat: I have been able to provide for an overall increase in recurrent expenditure in 1992-93 of 15.4% in money terms. In specific programme areas, this translates into a 5% real increase in expenditure on education, 4% on social welfare and 9% on health care. These are real improvements which will benefit the whole community and they should not be undervalued.
18. I regret that some Members have chosen to describe these significant real increases in expenditure on key services as "negative growth", "cuts" or even as "slashing expenditure". This is simply not correct, but having made this point, I do accept that it is not easy to calculate real growth rates from the draft estimates. I shall be looking at ways of improving the presentation of the estimates next year.
6
No comments yet.
Private notes are available after approval.