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HONG KONG URBAN COUNCIL

Park (Stage II) Improvement, the Kowloon Park Development, the Chai Wan Park Extension, the Development of Service Reservoir at the junction of Yee King Road and Cloud View Road, the Quarry Bay Park and the Park on the Western Reclamation.

Furthermore, the Council will be providing still more active recreational facilities when such major projects as Lei Yue Mun Park, Kowloon Park and Hong Kong Park are opened.

I am happy to announce that the first phase of the Lei Yue Mun Park will be opened for public enjoyment on 19 December.

Among the facilities to be completed in this first phase will be a grass pitch for soccer, rugby, gateball and fun games; a hard-surfaced sports ground which can accommodate four basketball courts, three volleyball courts and two basketball cum volleyball courts; an archery range and a demonstration nursery.

All this is ample proof of the Council's determination to upgrade the lifestyle of the people of Hong Kong and promote mass participation in recreational and sports activities.

MOTIONS

1. THE CHAIRMAN, URBAN COUNCIL, moved the following motion (in English):

"That the Estimates of Revenue and Expenditure for 1988/89 and the list of works which the Council proposes to undertake during the next financial year be approved for transmission to the Governor in accordance with Section 39 of the Urban Council Ordinance."

I move the adoption of today's Motion on the Urban Council's budget, which is otherwise known as the 'Estimates of Revenue and Expenditure, with the accompanying list of capital works for the 1988/89 financial year which will commence on 1 April 1988.

I am not going to bother you with long figures and statistics today but I am happy to say that we shall end the current financial year as predicted with a surplus of about $128 million, not through, mind you, spending less than what we had budgeted for last year, but mainly through increased productivity achieved over the year as a result of effective fiscal/administrative control, plus an increase in the overall revenue outturn by some 3.7% during this financial year. Also, I am glad to report (and probably Government will be glad to hear) that our reserves at the end of this financial year will stand slightly above the $500 million mark.

Now turning to the next financial year, the overall expenditure is estimated to be in the region of $2,530 million, representing some 13.8% increase over the outturn forecast for this financial year. Despite this increase in expenditure, we

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are still quite optimistic that by the close of the next financial year, we shall be able to end up with a surplus roughly in the order of $70 million, which my colleague, Mr. SULKE, would perhaps wish to elaborate further later on.

The Urban Council is a dynamic body and will continue to be so in the year ahead. Within the limits of next year's budget frame, we shall continue to step up our statutory role to improve public health, establish and maintain recreational facilities, conduct literary and cultural activities of various kinds and, above all, aim to make life happier, healthier and our city cleaner for over four million urban dwellers.

There is of course always a limit to what we can spend and do due to financial and/or physical constraints. When priorities have to be set, I am afraid that individual or group needs will have to give way to territory-wide interests for the benefit of our community as a whole.

Before I invite Mr. SULKE, Chairman of the Council's Finance Select Committee, to second the motion, I want to place on record the Council's appreciation for the Chief Treasury Accountant, Mr. MANNING, and his staff for the hard work in producing this year's budget. With this note, may I now pass it over to you, Mr. SULKE.

MR. WALTER M. SULKE, CHAIRMAN OF THE FINANCE SELECT COMMITTEE, said (in English):- Mr. Chairman, In seconding the motion may I first of all congratulate everyone in the Department, but especially the Chief and Senior Treasury Accountants who worked so hard to put this very complex budget together and get it out on time. We wish the CTA a speedy recovery from his most unfortunate accident although there are some unkind souls saying he did it deliberately at budget time. The Budget is complex, because we run a very large diversified operation with many priorities having to be balanced against each other and with a strictly limited income which we have to stretch to cover a multitude of expenditure.

This is by far the biggest budget ever presented to this Council, the total expenditure exceeding HK$2 billion, an increase of more than HK$300 million, or about 14% over the present year. At first glance that looks a pretty frightening figure, but when taking into consideration the weakening of the HK$, the forecast for inflation, and the considerable increase in our facilities and activities, it is, in fact, a very small increase. The good news, of course, is that our income is also increasing by something over 11% so that, in fact, we are budgeting for a small surplus of about HK$70 million, which in terms of a budget as large as ours is actually break-even as this surplus represents less than 3% of the total budget.

The joker in the pack is that our income depends very much on economic circumstances. In a good year Central Government may well under-estimate our rate income, while in a bad year it could easily happen to us that our rates income are over-estimated! And whereas previously once the Central Govern-

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tags.