A freeze on water charges is one of the measures the government has introduced to help the public cope with the highest inflation in a decade. Financial Secretary John Tsang Chun-wah said yesterday the decision to freeze increases in water rates this and next financial year showed the government's willingness to shoulder its responsibility. 'Although the operating cost for water supplies is increasing ... [this is] for easing the public and shop owners' burden under inflation,' Mr Tsang told the Legislative Council's financial affairs panel. Saying the government understood that surging prices had also increased construction costs, Mr Tsang said the administration would allow construction firms to adjust prices under contracts for new projects. In the past, price adjustments were possible only for projects that lasted for more than 21 months. 'For all new construction contracts, we are going to cancel the 21-month restriction and adopt a price adjustment mechanism to lower the pressure on builders and sub-contractors,' Mr Tsang said. Lawmakers called on him to offer more relief measures, especially for low-income families. Mr Tsang and government economist Kwok Kwok-chuen acknowledged the effect of rising global food prices on Hong Kong's inflation, but the government had not changed its 4.5 per cent inflation forecast for this year. Inflation in April was 5.4 per cent, the highest since January 1998. Mr Tsang said he had taken the impact of inflation into account when he prepared the budget, and insisted the HK$125 billion giveaway this financial year was sufficient. 'If there will be further changes [increases in prices], we will study what kind of policy we can implement to help the public,' he said.