Swansong plays to mixed reviews
BUDGET DEBATE REACTION by JIMMY CHEUNG and MAY SIN-MI HON
The Financial Secretary's swansong Budget was greeted with a mixed chorus of praise and criticism yesterday.
On the first day of a two-day Budget debate, the Liberals and other non-aligned members said Donald Tsang Yam-kuen's sixth and last Budget was pragmatic and conducive to recovery.
But the Democratic Party and the Democratic Alliance for the Betterment of Hong Kong said he should have dipped into reserves and helped the unemployed and home owners with negative assets.
Mr Tsang's fiscal philosophy was too conservative, said Democratic Party chairman Martin Lee Chu-ming.
"After the financial turmoil and the economic downturn, the Financial Secretary still stuck to his own prudent principles of public finance and has not made full use of the fiscal reserves to bring more hope for the economy," he said.
He said fiscal reserves in 1996 were $148.6 billion and had now risen to $432.9 billion, but government spending had increased by only 30 per cent in the period.
"The result is the Government failed to make effective use of the fiscal reserves and only invested it in United States bonds. The Government makes investment returns while members of the public have to suffer."
Citing the Cyber-Port project, Mr Lee said Mr Tsang had failed to create a level playing field to encourage fair competition. "The Cyber-Port project is the greatest stain in the term of office of Mr Tsang," Mr Lee said.
The project was awarded in 1999 without tender to Pacific Century CyberWorks, chaired by Richard Li Tzar-kai who is the younger son of tycoon Li Ka-shing. The Government was criticised for giving the Li family preferential treatment.
Mr Lee said the Government must meet three conditions if the Democrats were to vote for the Budget: give an extra $3 billion to universities through the University Grants Committee in the next three years; commit extra funding of $2.2 billion on education and retraining; and set a ceiling on the admission of mainland talents.
Liberal Party leader James Tien Pei-chun said Mr Tsang was right to keep changes minimal in view of economic uncertainties around the world.
He praised the Financial Secretary for doing a good job over the past six years, especially his decision to defend the stock market by injecting about $118 billion in 1998.
"I think the most commendable thing is that Mr Tsang defended the stock market with courage and perhaps a little luck. Few people could imagine we would end up making so much money," he said.
DAB chairman Tsang Yok-sing wondered if the Financial Secretary's forecasts for economic growth could be achieved as the climate was still fragile.
Another DAB member, Yeung Yiu-chung, said: "The Budget looks like an inaugural speech or a mini policy speech. It seems that the secretary has played his role as chief secretary early."
Ambrose Lau Hon-chuen, chairman of the Hong Kong Progressive Alliance, supported Mr Tsang for maintaining a low tax regime to ensure Hong Kong's competitiveness.
Non-affiliated Lau Ping-cheung of the surveying sector said his constituents were unhappy about certain unresolved problems but "we have to thank the secretary for defending the stock market and a smooth transition. History will give him credit". Members will continue the debate today and vote on the Budget after officials have responded next Wednesday.
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