I have been a staunch advocate of putting the Government's shareholdings back on the market at a discount rate for Hong Kong residents as a means of enriching the public. The Government should be applauded, for once, for heeding public opinion.
The scheme to create a fund to facilitate an orderly release of the blue chip stocks held by the Government has been mooted in different circles for quite some time, although I was the first to champion the proposal on air. I contributed to the initiative primarily by suggesting a concession be extended to all residents with three asterisks on their identity cards. The Government goes one step further, so that all residents, permanent or otherwise, can enjoy the preferential offer.
There is no way to ascertain how much influence my suggestion exerted. Economists are in favour of returning to the public profits from the Government's stock market intervention. A strong public consensus has made it easier for the administration to take this unprecedented step.
Yet the affair raises two other key issues. First, there is the proposition that a certain portion, say one per cent, of the windfall be set aside for a charity trust. The money could be used to subsidise charities and voluntary agencies.
The remaining profits could be used to establish a second fund to finance the retirement and welfare entitlements of civil servants. The latter proposal, in particular, will have a stabilising effect on the civil service and thus on the SAR. Civil service retirement entitlements are already a heavy burden on the Treasury. The amount involved is astronomical.
The former British Hong Kong administration failed to set aside any reserves for this purpose and the Government had to resort to tax hikes to meet such needs. Fortunately, the creation of TraHK (Tracker Fund of Hong Kong), the vehicle for releasing to the public stocks held by the Government, will result in substantial income, enabling the authority to address this problem.