It would be wrong to regard the lower-than-expected turnout for this year's July 1 march as a vote of confidence in the government. Some 30,000 people, almost twice the number last year, took to the streets in temperatures of more than 30 degrees Celsius - underlining the depth of their dissatisfaction with the government on a host of issues.
The increase in the number of protesters is significant when viewed against the fact that the government has deliberately deferred public consultation on a number of controversial issues, such as the electoral arrangements for 2012, the public broadcasting review and health care financing. Also, in the 12 months since the last march, the government has handed out some HK$80 billion in relief measures aimed at benefiting every sector of the community. Numbers aside, this year's march sent some important warning signals to the government.
The first came from the Alliance of Lehman Brothers Victims that decided to march ahead of the main procession. This group carried banners attacking Chief Executive Donald Tsang Yam-kuen and calling on him to step down. A number of them tried to storm the Bank of China tower en route. They ended their protest by issuing an ultimatum to the government to resolve the matter to their satisfaction before October 1, China's national day.
The government issued a statement afterwards making three main points. First, it hoped that the institutions involved would expedite the matter. Second, it encouraged voluntary settlements between banks and clients. Third, if necessary, it would assist the victims through the Consumer Legal Action Fund (legal proceedings will go ahead soon in one case).
I am afraid the government is seriously underestimating the political risk of this hands-off approach. The fact that two brokerage firms have settled the case by repaying the full amount to buyers of Lehman Brothers products has reinforced the view of many who bought similar products from the banks: that there was a prima facie case of misrepresentation or negligence on the seller's part. It has also raised their expectations of receiving similar compensation from the banks.
The Securities and Futures Commission authorised the sale of these products and the Monetary Authority supervises banks' operation. The government cannot shirk its responsibility. It should intervene so that the banks can make a general offer of settlement to their clients. The Alliance of Lehman Brothers Victims is certainly capable of mounting a massive demonstration on October 1. If that happens, the general public is unlikely to be on the government's side.