Hong Kong’s budget could do with some daring, but can Carrie Lam go the distance?
Alice Wu says the final responsibility for solving Hong Kong’s ‘too much money’ problem rests with the chief executive, who must be both creative and courageous with the budget
Expectation management is tricky business, especially when the boss has been building the hype while you’ve been playing it down. This is the predicament Financial Secretary Paul Chan Mo-po has found himself in. When Chief Executive Carrie Lam Cheng Yuet-ngor addressed guests at the inauguration ceremony of the Chinese Manufacturers’ Association of Hong Kong earlier this month, she hinted that her administration’s first budget “could possibly be full of surprises” and would be more “daring” in its spending. It’s part of Lam’s “new fiscal philosophy”.
Understandably, Lam is excited about it. But with yet another ridiculous budget surplus this year, Chan is going to have to show that he can walk on water if he wants his Wednesday budget to be lauded.
It is true that the Hong Kong government’s persistent problem is one that many in other parts of the world would wish to have: having too much money. For Hong Kong, it’s been our “problem” for way too long, so much so that the annual drastic miscalculations of the surplus have become a sore point with the public.
If having too much of it is the crux of the problem, then spending it would be the solution. And the easiest way to spend it is to give it back to the people, à la Macau. We’ve tried that once and there has been renewed calls for a repeat, but the financial secretary has been discouraging, saying that the government would prefer more “targeted measures”.
But the fact is, no matter what politicians and bureaucrats may say, they have been at a loss as to how to spend the continuously fattening public purse. In other words, our leaders have yet to find ways to “target” spending. The lack of good ideas (think food trucks that don’t move) or, as many critics have argued year after year, the lack of political will to commit to long-term costly and therefore controversial policies – for example, universal pension – is the problem.
Chan’s predecessor John Tsang Chun-wah has been criticised for government surplus miscalculations and his conservative fiscal philosophy. But let’s face it, it’s not so much the financial secretary’s problem. It’s the chief executive’s. An “executive-led” political system means that with power comes the responsibility to lead, which includes coming up with policy solutions, and presenting and selling these policies to lawmakers and the public.
That is something the chief executives that have come before Lam have all failed to do. And that is why, in lieu of good spending ideas, the government has consistently fed the people the same excuse: its constitutional requirement for “prudent financial management”.
While Article 107 of the Basic Law does say that the government “shall follow the principle of keeping expenditure within the limits of revenues in drawing up its budget” and for it to “avoid deficits”, this is not an excuse for the government not to do its job of taking care of the people and the city’s problems.
And this city’s problems have been stockpiling for decades. Lam cannot be ignorant of this fact.
Barely a month ago, Lam was in Davos attending the World Economic Forum, where she trumpeted Hong Kong’s positive economic outlook. She also said it was necessary to “take the opportunity to improve governance … and to put in place sound social policies” – policies that would address issues like poverty, income inequality and a lack of opportunities for young people.
On Wednesday, we’ll see whether there are indeed surprises in the budget. That hinges on how “daring” Lam is when it comes to articulating these “sound social policies” in real budgetary terms. Otherwise, “poverty, income inequality and a lack of opportunities” are mere catchphrases, and the government may be better off just handing out money.
Alice Wu is a political consultant and a former associate director of the Asia Pacific Media Network at UCLA