• Tue
  • Sep 23, 2014
  • Updated: 11:41pm

Bonds are no substitute in cutting deficit

PUBLISHED : Monday, 04 October, 2004, 12:00am
UPDATED : Monday, 04 October, 2004, 12:00am
 

Professor Tony Latter's column headlined 'You can't borrow good news' (September 23) raised a few points which require clarification.


Financial Secretary Henry Tang Ying-yen believes in transparency in public policy formulation and set out clearly the government's current position in his first budget speech on March 10. Mr Tang said in the budget that 'operating expenditure should be covered by operating revenue' and that 'we will definitely not live on credit' and has set specific operating expenditure guidelines with a view to restoring fiscal balance by 2008-09.


In the budget speech and since, Mr Tang has said repeatedly that issuing bonds to fund infrastructure or other investment projects is but a means to provide greater flexibility in the management of our liquidity. It can be no substitute for continued efforts to address the true deficit, through stimulating economic development, containing public expenditure and raising revenue. Indeed, the government has spared no efforts in improving the efficiency of its departments and agencies and containing growth in expenditure.


As far as accounting is concerned, our presentation of the data on outstanding government debts complies with the special data dissemination standard of the International Monetary Fund. We have no intention whatsoever to attempt to mislead the public into thinking that the budget is healthier than it actually is - and we believe it is not in anyone's interest to do so.


The government has made clear that the revenue of $73.4 billion and the deficit of $5.3 billion up to the end of July were arrived at after accounting for the $6 billion toll revenue bond and $20 billion government bonds issued earlier this year. We have disclosed details of these bond issues (including the outstanding amounts and the maturities) in the monthly press notices. And we will present similar information in our future quarterly government accounts. At present, the accounts, which are cash-based, are prepared primarily to demonstrate the government's compliance with the appropriations approved by the legislature and stewardship of cash spending.


The treatment of the proceeds from the toll revenue bond and government bonds as a revenue item follows our cash accounting convention. This convention has its limitations. That is why the government has published its first set of accrual-based accounts for the year 2002-03, as well as the cash-based accounts. We will continue to prepare the cash-based and accrual-based annual accounts in parallel and review the arrangement in 2006-07.


LAURIE LO, press secretary to the financial secretary


Why fly in one plane?


I was horrified to learn that a planeload of more than 200 of Hong Kong's top leaders would fly to Beijing from Hong Kong on the morning of September 30, and then back that night. I very eagerly awaited their safe return.


Imagine if the plane had gone down! What would happen to Hong Kong? Why do we have to put our leaders at risk all at once? Where is our sense of risk management?


ALFRED SHUM, Aberdeen


TV anthem futile


Does the government really believe that broadcasting the national anthem nightly on Hong Kong's Chinese-language television channels will instil patriotism in members of the public?


Not likely! It will only be seen as propaganda or the sign of a desperate government pandering to Beijing.


Presumably we can safely watch the news on the English-language channels without being subjected to the government's antics.


KAM LEUNG, Sha Tin


Blank-ballot protest


Contrary to what Chris Yeung said about the election in the column headlined 'As the dust settles, pride in stride to democracy' (September 19), the dust has far from settled.


I refer to a new phenomenon. Frustrated by the poor work of candidates who sought re-election and the pathetic platform of those who stood for the first time, I and a number of my friends chose not to vote at all. Instead, we cast blank ballots - protest votes.


In doing so, we signified clearly that none of the candidates represent us. We did so because we dread the thought of legislators-elect claiming that they have our endorsement and the people's mandate. It is high time that we elect only those we want, not those we can best put up with. In short, we are fed up and we want some changes.


From feedback we have received, more and more people have taken this stance. I wonder if anyone has done a study on this new phenomenon. Does the electoral commission have any statistics on the number of blank votes cast? It would be interesting to see how many are in this 'silent majority'. I suspect it will be a force to be reckoned with in the next election.


NAME AND ADDRESS SUPPLIED


Step up voter education


I was astonished to learn from Albert Cheng's column (September 25) that 'the proportional representation system is unfair'. I was even more astonished to learn why: 'The majority of voters - and some candidates - do not know how it works.'


While many may not understand the system, this in no way impugns the fairness of proportional representation (PR) over its rival, the first-past-the-post system, which New Zealand rejected as unfair in 1996 when it adopted mixed member proportional representation. Many other countries, including Germany and Ireland, employ a form of PR.


Such systems enable a wider range of views and political parties to be represented. Voters in the minority are also represented, whereas under first-past-the-post the winner takes all, even if the majority is only 50.1 per cent. Should I understand Mr Cheng to mean that he rejects the representation of minority views?


I do not mean to suggest that PR is perfect. It is not, but on what logic is first-past-the-post better - because it is easier to understand? The issue here is citizen education, not the system.


ALEXANDRA COOK, Pokfulam


Pollution source not HK


I completely agree with the letter headlined 'Mainland and pollution' (October 2), which says the main source of Hong Kong's pollution is the industrial areas across the border.


I am tired of people who, either through political motives or poor memories, try to get us to believe that the source of our dreadful pollution is within Hong Kong. Thirty years ago one would visit the border and see fields. Within the built-up areas of Hong Kong there was congestion as well as vehicles emitting far dirtier exhaust than now. But the days were clear, especially at this time of year.


Now, factories, industrial plants and power plants across the border produce a large amount of pollutants. And when the wind blows this way, we have a bad environment. I couldn't believe it when on Wednesday, virtually all the passengers sitting on the upper, outer deck on the Mui Wo ferry from Central were forced to vacate the area after about 30 minutes because of watering eyes and pollutants entering nasal areas.


All efforts to ease pollution should be directed across the border. Letters to your newspaper complaining about cars idling, for example, are only scratching the surface. If no cars idled we would still be choking. If industrial emissions in the Pearl River Delta were subjected to the same controls of many industrialised nations, we would be breathing much cleaner air.


I am astonished that there are no rallies to protest against the dirty air in Hong Kong. Is it because we think there is nothing we can do about it? Surely there is!


CHRIS STUBBS, Mid-Levels


Cleaner democracies


The letter 'Scions of leaders' (September 30), which implied that leaders of democracies give special privileges to their offspring in the same way that Chinese Communist Party leaders do, was mildly amusing. But it misses the point.


Supporters of democracy do not believe that the system somehow magically produces leaders who are pure and innocent. But even a cursory look at the world and some elementary thought will show that democracy provides a much higher chance of avoiding corruption. First, democratic systems have a much better chance of spotting and exposing corruption because the opposition's future depends on it. Second, democracies routinely change their government, which provides a regular firebreak against the building of corrupt practices.


America prevents anyone from being president for more than two terms. The mess the UK's Conservative Party got into by its fourth term shows that there may be some wisdom in this.


Anyone who thinks that China will sort out its corruption problems with an autocratic, anti-democratic government will be very disappointed.


ROY PROUSE, Stanley


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