Wednesday, 24 February 2016

John Tsang's "Localist" Budget

Financial Secretary John Tsang had some breaks for people this year
Today Hong Kong Financial Secretary John Tsang Chun-wah got some rare praise today for his ninth budget that seemed to be more sympathetic with Hong Kong people who have been and will be struggling because of the sluggish economy.

In his speech that took an hour and 25 minutes to read out, Tsang began with giving his take on recent events in the city, describing the Mongkok riots as having turned Hong Kong into a "strange and alien place".

Will Cantonese films like Ten Years get more funding?
"I believe many people share my feelings towards the incident. Distressed and angry, I was perplexed as to why violence had flared in Hong Kong," he said.

"I was shocked that our city could have turned overnight into such a strange and alien place that I hardly recognized. I was troubled why the core values that we long cherished had been devoured by violence and hatred."

He added: "Acute social conflicts will add uncertainties to the already adverse economic environment."

Then he went onto the task at hand, saying Hong Kong's economy grew 2.4 percent last year, but only expects it to expand 1-2 percent this year. Some of his main budget relief measures include reducing salaries taxes by 75 percent to up to HK$20,000, while government rates will be waived up to HK$1,000 per quarter, so homeowners can save up to HK$4,000 a year.

There will be extra allowances for those with social security, old age allowance, or disability allowance, but no rent reductions for those in public housing -- an area that even pro-Beijing lawmakers were not pleased about.

The government will spend more for more beds in hospitals
Spending on health care has almost doubled compared to 10 years ago to HK$57 billion, making up 16.5 percent of the government's expenditure. Most of the money goes to more hospital beds, more operating theatres and specialist outpatient services.

Either the government is not catching up with what public hospitals need, or way more people are getting ill -- which one is it?

Why not spend on trying to encourage people to live healthier so that healthcare spending can go down? In the long run it's better for everyone. The government is trying to get people to eat less, but it doesn't seem to be working when a good amount of space in supermarkets and convenient stores sell junk food...

Tsang is encouraging more companies to invest in research and development, and noted there are 1,600 startups in the city. That doesn't mean all 1,600 of them will succeed, I hope he understands, and many of them want to get to Silicon Valley and not necessarily stay here...

Interestingly, following the runaway success of local indie film Ten Years, Tsang has earmarked HK$20 million into the Film Development Fund to subsidize expenses incurred by locally-produced Cantonese films in distribution and publicity work on the mainland. Funding per film will double to HK$500,000.

Does this mean he will fund more films like Ten Years? Or just sappy Canto romantic comedies or martial arts flicks?

Commerce Secretary Gregory So selling the food truck idea
He is still keen on his pet project of food trucks in the city. Instead of 12 food trucks in six tourist spots, Tsang says the spots will increase to 16 due to "wild interest". However he didn't mention anything about hawkers, which was the cause of the Mongkok riots on February 8...

Perhaps most telling was Tsang's take on the "One Road, One Belt" policy that his boss Leung Chun-ying mentioned 44 times in his policy speech. Instead the Financial Secretary only mentioned it four or five times according to Civic Party leader Allan Leong Kah-kit.

"That has already highlighted their differences. I guess that is also what Tsang wants to highlight," said the lawmaker.

So while Tsang didn't please everyone, most were relieved he was thinking of those who need a few breaks, though they are only short-term measures. He is waiting to see how this year pans out before seeing if more tax breaks are needed, but really, does anyone see a bright spot in Hong Kong's economy anytime soon?

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