There is a Chinese saying that 'the cleverest housewife can't cook a meal without rice'. But our financial secretary has plenty of rice. With a forecast surplus of HK$71.3 billion and expected fiscal reserves of close to HK$600 billion (equivalent to 23 months of government expenditure), he has more than enough money to improve our air quality. What has he done in this budget to help us breathe cleaner air?
He proposes to spend HK$4.7 billion, giving a subsidy of HK$1,800 to each residential electricity account. This runs counter to the government's policy to encourage energy savings and carbon reduction.
I made the same point three years ago when John Tsang Chun-wah first gave the electricity subsidy in his 2008 budget. I suggested that the subsidy should be structured in a way to encourage energy saving.
For example, it could be given only to account holders with low consumption rates. Or it could be given out quarterly, only to those who can demonstrate reduced consumption rates when compared with the previous quarter. But he ignored the suggestion and made the same mistake this year.
Under the heading 'Easing Traffic Congestion', the financial secretary proposes to increase first registration tax for private cars by 15 per cent.
Again, this runs counter to the government's policy to encourage the owners of old commercial vehicles to switch to using cleaner new vehicles, through, for example, the one-off grant of 12 to 18 per cent of the cost of a new vehicle. The increase in first registration tax will reduce or cancel out the incentive in the government's own scheme.