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HK Finance Secretary under fire over budget
By Roland Lim | Posted: 24 February 2011 1735 hrs

HONG KONG: The Hong Kong budget, announced on Wednesday, has been criticised by some residents for being miserly.

Financial Secretary John Tsang faced the wrath of radio callers in a radio phone-in programme on Thursday morning, disappointed about the government handouts despite a budget surplus in excess of US$9 billion.

Many criticised him for not giving direct cash handouts but opting instead to inject a one-off HK$6,000 each into the workers' retirement funds.

A male radio caller said: "I think you should've put HK$3,000 into the Mandatory Provident Fund and HK$3,000 into the hands of citizens. Your policy can't help the people immediately, we may have to wait a couple of decades before we see that money."

However, the Financial Secretary defended his decision and said that cash rebates would worsen inflation.

"I didn't want the measures to have an impact on inflation. My choice is to save the money, to use for a rainy day," said Mr Tsang.

Then there are callers who complained that the budget had not tackled high property prices.

A female radio caller asked: "You can see from today's newspapers, there's already adjustments for higher prices...why don't you start rebuilding government subsidised housing for our sakes?"

The government had promised to supply more land in the coming year to build between 30,000 to 40,000 housing units, double the usual annual average.

Marcellus Wong, Tax Partner with PricewaterhouseCoopers, said: "People were expecting that the government would do more to help to address the two big problems, inflation as well as the gap between the wealthy and the poor."

Hong Kong's economic outlook delivered in the Budget speech reinforces that Hong Kong's economy is firing on both cylinders. However, there is the risk that property prices will continue to climb and asset bubbles form this year. That may be handled by off-Budget measures, to be introduced by the Financial Secretary if necessary.

-CNA/ac