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Dennis Eng

Political parties have pushed the government to introduce additional relief measures to tackle unemployment and the economic downturn, ahead of the budget debate today. 
 The policies unveiled in February's budget, particularly those on unemployment and boosting the economy, were heavily criticised as  failing to go far enough at a time of financial crisis.  
 Survey results released yesterday  by the University of Hong Kong  showed that  68 per cent of respondents said  the budget's short-term strategy to counter the financial crisis was insufficient. 
 The pan-democratic camp and the Liberal Party have put forward two proposals for relief measures, each costing an extra HK$20 billion. 
 While the pan-democrats have threatened to veto the budget if the government fails to respond positively to the request, some government allies have yet to pledge their support. 
 The legislature will today begin a two-day debate on Financial Secretary John Tsang Chun-wah's  second budget.
The Liberal Party put forward a package of relief measures, including HK$6.5 billion in shopping vouchers to boost domestic consumption and a HK$500 million value-added fund to help unemployed middle-class people. 
 The party also asked the government  to refund provisional payments to taxpayers and businesses  to help them counter difficulties during the financial crisis. 
 While the administration had  reiterated it would reassess the economy in the middle of the year,  the party's vice-chairman, Vincent Fang Kang,  warned against delay.  
He said he hoped the government would not underestimate the situation.  'It will get even worse if it waits for another three to four months. It will be too late,' he said.
 The party has yet to decide whether to back the budget. 
 In recent weeks, the Democratic Party and the Civic Party have met the financial secretary, urging him to consider the pan-democratic camp's  package of relief measures, including cash provisions for the jobless, and allowing more people to benefit from travel allowances. 
Civic Party lawmaker Ronny Tong Ka-wah  said: 'I hope the government will respond positively to the proposal. Otherwise, it will be difficult for us to back the budget.' 
 Despite political parties' requests for budget measures to be strengthened,  Lau Kong-wah,  deputy chairman of the Beijing-friendly Democratic Alliance for the Betterment and Progress of Hong Kong, said the party would support the budget in the hope that the government would come up with more policies in the next few months. 
 The satisfaction rate for the budget dropped to 21 per cent in mid-March from 24 per cent recorded on February 26, the day after the budget was delivered, a survey conducted by the University of Hong Kong's public opinion programme found two weeks ago. 
 Meanwhile, a deficit of just over HK$6.6 billion was recorded in February.  In the first 11 months of the financial year,  the budget surplus was HK$43.21 billion. At the end of February, the  reserves stood at HK$536.1 billion, government data showed. The financial secretary had predicted a deficit of HK$4.9 billion for 2008/09 although the final result may show a slight surplus, PricewaterhouseCoopers tax partner Tim Lui Tim-leung  said. The firm had expected a surplus of more than HK$10 billion in 2008/09.
Historically, a surplus is usually reported in March.  But the need to make payments to Mandatory Provident Fund accounts, the Research Endowment Fund as well as for the Sichuan earthquake reconstruction effort would probably result in a deficit of between HK$5 billion and HK$7 billion this time, Mr Lui said. This may reduce the surplus for the financial year to about HK$5 billion.  
The MPF injection is estimated to be about HK$9 billion, payments to the Research Endowment Fund will be about HK$18 billion, while the Sichuan reconstruction payments will be about HK$4 billion.



Parties to push for more budget relief measures