Executive Council convenor Chung Sze-yuen yesterday warned of a deficit in the current Budget in the face of falling proceeds from land sales and advance spending on infrastructure projects.
He said the projected premium from land sales in the 1998-99 Budget was based on market values when the Budget was drawn up.
'We all know with property prices falling, the price of land will fall, too, and as a result, income will be smaller.' Financial Secretary Donald Tsang Yam-kuen has estimated a modest surplus of $10.7 billion in this Budget.
Asked whether the Government should formulate a deficit Budget next year, Mr Chung said it was too early to draw any conclusion.
'We have no idea what the situation will be in nine months' time.' he said.
But he admitted it would depend on land revenue for the present year.