With Hong Kong mired in economic stagnation, the government's priority should be confidence-building. Yet it is doing little to quash rumours and allay fears over such fundamentals as unemployment and security. Our vital signs are not good; jobless rates are at their worst for more than two decades and we have a record budget deficit. The global economic situation is not forecast to change any time soon. Our social security net is failing, with the number of homeless and elderly unable to care for themselves rising. Fears that Article 23 will trample on civil liberties and freedom of speech are rife. The Bali attacks brought home that we are as much a target of terrorism as the United States. A surge in crime and the number of guns seized in police raids has served to worsen our insecurity. Regionally, North Korea threatens to lessen stability by restarting its mothballed nuclear programme. If a US-led coalition declares war on Iraq, oil prices will soar and economic hardship will increase. The Chief Executive, Tung Chee-hwa, and his officials have a difficult job - dealing with economic and social uncertainties is not an enviable task. They know they have to balance the books, while ensuring Hong Kong's mood remains positive and the future bright. At a time when many of the SAR's companies have down-sized or restructured and employees have had their salaries cut or frozen to accommodate the economic climate, there is no doubt the government should do the same. The civil service cannot be immune from the changes affecting the private sector. With the budget deficit at $72.4 billion, the government's targeting of its own workforce to make savings is an obvious move. But it must be done with attention to the needs of the people of Hong Kong. Rumours that the police force could lose up to 2,800 officers - one-tenth of its strength - make little sense at a time when crime is rising. While unemployment remains high and the economic forecast is bleak, the number of robberies and thefts will only increase. Security is the best weapon Hong Kong can have in such times, and our police force, regarded as the best in Asia, should remain at its present strength or even be increased in number. The government has to reduce spending, but doing so at the risk of the safety and security of the people it serves is not the way to tackle the problem. It must swiftly put such fears to rest.