FS denies plan to slow spending growth

03-08-2014

Financial Secretary John Tsang. File photo The Financial Secretary, John Tsang, has defended a government initiative to cut recurrent spending, saying the move is needed to prevent a structural deficit, and to channel limited funds into new policies and services that are most needed by the community. In his latest blog entry, Mr Tsang wrote that the government isn't 'turning off the taps ’ so much as it is slowing down the rate of growth in spending. He wrote that new money available to departments will be 'very limited' in light of a slowing economy, an ageing population, and the impact of increased services rolled out over the past two years. > As a result, the government will temporarily stop accepting departments' applications for new recurrent funding, so it can put the savings into the initiatives that are most needed by the community. These initiatives will largely be announced in future policy addresses. But Mr Tsang said there's no question that the government is changing from a bottom-up- to a top-down structure in its policy formation, saying bureaus and departments will still be required to propose new initiatives for the chief executive's consideration before he announces them in his policy address. Critics have questioned whether that the focus on policy address initiatives will effectively allow the Chief Executive to take all the decision-making power away from the Financial Secretary. Government departments are being asked to cut recurrent spending by one percent per year for two years starting in 2016. Mr Tsang said the government is hoping departments will re-evaluate their priorities, scrapping services that are no longer needed, and consolidating others. http://rthk.hk/rthk/news/englishnews/20140803/news_20140803_56_1026937.htm