Paul Chan Hints Fiscal Policy Change Ahead Of Budget

Financial Secretary Paul Chan on Saturday said the administration may have to adjust its fiscal policies, after officials had put in place counter-cyclical measures at a time when the Covid situation was severe in Hong Kong.

The top official made the comments on an RTHK programme "Voices from the Hall", where he listened to public opinion ahead of his next budget speech on February 22.

"In the past few years, we've adopted an expansionary fiscal policy. When the pandemic is severe and the economy is under great pressure, we need to spend money and use the fiscal reserve and policy to stabilise the economy. We also had to try our best to relieve the pressure of citizens, and small and medium-sized enterprises," Chan said.

However, he said the policy direction will change as Hong Kong enters a post-pandemic era, and that the government has to invest in the future and boost development.

Chan now faces a debate on whether to issue another round of spending vouchers, as Hongkongers received a HK$10,000 handout last year and HK$5,000 the year before.

The financial chief was asked about his thoughts on dishing out a fresh round of consumption vouchers, with some audience members expressing reservations.

In response, Chan said authorities had to take public finances into account.

"Over the past two years, because of Covid and the economic downturn, many citizens have been under a lot of pressure. Our measures were counter-cyclical, with the aim of relieving pressure on people, but every time we spent quite a lot of money," Chan said.

"At this moment, we have to be cautious. The economy has started to recover but there are uncertainties. The recovery isn't fast and strong enough. Overall, some policies need to be adjusted and we can't press ahead as we did before."