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(a) After the recession, when the various departments resumed the many projects curtailed, there was no lack of money, but of talent, raw materials and skills etc. which led to increases in expenses. The expenditure proved to be higher than what would have been incurred by long-term development programmes.

(b) Thus it was the government which started the trend to over- consumption in the economy in 1980-81, affecting economic development and deferring public expenditure.

(2) On the social side:

After the riots in 1966 and 1967, the government obviously realized the existence of internal problems and disaccord. Years of study resulted in the publication of several White Papers in the early seventies which took into account social problems in all areas and laid down standards for public policies in an attempt to eliminate uneasiness and disaccord in the society. But the implementation of public policies was delayed once and again by the inevitable fluctuations of the capitalist economy, causing uneasiness in the society. Under pressure from the educational circle in the early seventies, the government finally revised its education policies to introduce nine-year free education in 1976. The ten-year housing programme introduced in 1973 originally planned to provide 35 000 public housing units annually and increase the number to 45 000 annually in the eighties. But 1974–75 saw only 12 000 housing units. In the early eighties when the economy had recovered, the number was increased to only 28 000. Even in times of economic prosperity, the shortage in the supply of housing units was reflected through social action by the people. In the two years between 1979 and 1981, for three out of five days on average, there was social action (press conferences, petitions, protests, rallies etc.) against government's housing policies. Likewise, the shortage of doctors, clinics and hospitals has also met with response from many communities, the first being Chai Wan which was followed by Tuen Mun. The government has recently announced its decision to postpone the construction of hospitals in East Kowloon and Tai Po. Inadequacies in the provision of community facilities will lead to more social action in the future. Social welfare expenditure very often follows the fluctuations of the economy; in the years 1979-1982, the annual increase in expenditure on average is 23 per cent, but in 1983 and 1984, it dropped to 12 per cent. Much of the work approved in 1981 and 1984, such as the provision of more aid to discharged prisoners, more family life education, family services, youth centres, school social work and standard units etc., was stopped. As people for whom these services are meant are not organized, they may not be able to express their dissatisfaction through public action. Some in-service professionals predict that the next two years will see an increase in crime and drastic increases in family disputes, divorce cases and youth problems etc. The structure of society will start to disintegrate and attachment to families

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weaken. As regards labour, there is basically no special government spending on it. Relevant policies are reflected by labour laws which are not made with a view to caring for and protecting the workers. In times of economic recession, some irresponsible businessmen may simply close down their factories and run away. The year 1982 saw 258 such cases, with arrears of wages amounting to $20,710,000. 1983 saw another 417 cases and the situation in 1984 was even worse. As workers receive no wages for their work, they and their families are badly affected.

I believe none of us would wish to see facilities not keeping up with increases in population and demand, i.e., shortages in the provision of housing units, hospitals, schools and welfare facilities; we do not want to see whole families living in single rooms, patients sleeping in corridors, pupils going to schools in far away districts, youth and old people loafing and idling about, and workers not protected in their work and living. I am afraid over-emphasis in linking up public policies with economic development will cause disintegration of the society. The government has gradually become more open in recent years. The functions and role of elected councillors have been enhanced. And the present policies are such that people are no longer restricted as they were in the past, for if the people mistrust the government, it would be difficult to lay the foundation for a stable society.

Planned public policies of non-intervention

While I do not under the present circumstances favour unlimited introduction of social services which may do damage to Hong Kong's economic elasticity and policies, I in no way agree that economic policies should serve investors only (enabling them to earn large sums of money) and neglect those who work hard for them. The government should formulate policies to crub the deteriora- tion of social problems and ensure that people are not deprived of their rights of living or prevented from enjoying fruits of labour. Thus I wish to put forward a third possibility-planned public policies of non-intervention. There are five principles behind such public policies:

(1) public policies should be well coordinated, each being part of a whole set

of policies;

(2) standards on public policies should be set in accordance with population

increases and demands;

(3) the quantity, quality and development in regard to each public policy should be in keeping with Hong Kong's economic conditions and

resources;

(4) We should take into account the investment and taxation systems in Southeast Asian countries and countries which compete with Hong Kong in setting the levels of tax revenue and public spending;

(5) only the public understand their own problems; the government should provide enough channels for them to participate in the formulation of policies.