Budget Time in Hong Kong

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Ever since the public consultation for the 2019-20 Budget started in December, different groups are preparing recommendations for Hong Kong’s financial chief Mr Paul Chan Mo-po.

Mo’ Money, Mo’ Babies Mo-po!

On Thursday, local think tank Roundtable was among the first advocates to approach Mr Chan. With a focus on boosting Hong Kong’s birth rate, the group calls for increasing child allowances from HK$120,000 to HK$200,000 and improving child care service. It proposes 11 measures in total.

“We urge the government to raise child allowances significantly to reduce barrier to give births and alleviate citizens’ burden on raising children,” says Roundtable in a statement. “Besides tax allowance, the government should introduce policies in different aspects such as education and housing to encourage childbirth.”

A survey by the Hong Kong Federation of Youth Groups reveals that a low birth rate is closely tied to financial burden.

“Land and population have always been two main concerns for the Hong Kong public… The city has seen a low birth rate at 1.1 to 1.3, lagging behind the rate of population aging,” the group says. It also points out that by 2036, Hong Kong will see 1.2 million more people aged 65 or above.

Roundtable also proposes improving child care services by fully subsidizing training courses for those who intend to work as home-based child carers.

“We advise the government to raise the salary of child carers to match the statutory minimum wage. We also suggest transportation allowance for them to accompany the children for outings,” the think tank says.

Other suggestions include smart parking and recycling systems, the fourth cross-harbour tunnel and a fund for IT security.

3 magic bullets for Mr Chan

Meanwhile, Mr Chan already hinted that the next Budget will focus on supporting enterprises, preserving employment and stabilising the economy.

The financial chief says he hopes to relieve the impact of external economic changes on Hong Kongers by focusing on these three aspects.

“Affected by international trade conflicts and other factors, Hong Kong’s economic growth slowed down in the third quarter of this year, and the economic outlook for the next year is full of uncertainties,” he says in a blog post.

Hong Kong’s GDP growth stood at 4.6 percent in the first quarter and 3.5 percent in the second, but dropped to 2.9 percent in the third.

He also predicts a surplus for the next financial year, but hints at fewer relief measures – referred to as ‘sweeteners’ among locals.

Last year, he predicted a surplus of HK$46.6 billion for the 2018-19 Budget, but the government eventually recorded a surplus at a record high HK$148.9 billion.

Different parties called for cash handouts that Mr Chan opposed initially. After a months-long debate, he finally gave in to agree to HK$4,000 cash handout for 2.8 million people to share the wealth.

Mr Wong Kwok-kin, a cabinet member and a lawmaker with the Federation of Trade Unions, said the surplus is expected to drop to about a third of the HK$148.9 billion from last year. In a radio programme show, he dismissed any possibility of cash handouts.

Meanwhile, Deloitte forecasts a deficit of HK$23.8 billion for the 2019-20 fiscal year due to a decrease in land premiums amid a much cooled-down property market and slower economic growth.

This year’s Budget will be submitted to the LegCo for discussion on February 27.

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