Fresh fiscal philosophy is just what city needs

The Honorable Paul Chan Mo-po’s first budget speech delivered under the special administrative region’s fifth-term government opened with “three objectives” which included diversifying our economy, investing for the future, and caring and sharing. No one will debate with these objectives, which have all been subjects of intense discussion for decades, but I was delighted to find a section on public finances that talked about a “new fiscal philosophy”. The financial secretary says that keeping public expenditures within 20 percent of the GDP was a “past criterion” and that “today…we need to be more proactive in managing public finances in the face of various development needs of society and the economy”. He went on to say that starting in the 2018-19 fiscal year, public expenditure will be slightly higher than 21 percent of our GDP. He was cautious in saying that he was aware of the need for sustainability while ensuring that enough funding will be available to meet the actual needs of Hong Kong. While 21 percent is really not that much different from 20 percent, the fact that he indicates more flexibility and willingness to be more innovative is a welcome signal.

During the morning of the budget speech, I listened to a phone-in program on RTHK. One person hoped very much that the government would open up its purses to offer each citizen a cash payout. He was aware of the aging population and the need for greater spending on healthcare, elderly care, and on housing. But he complained that over the past few years since the last handout of HK$6,000 in 2011 there had been no cash handout, but he did not see public healthcare services improve at all. Since the benefit of the savings from not offering a cash handout did not show, he would rather have a cash handout.

This person’s observation is correct. Over the last few years, the quality of our public healthcare services has declined noticeably. Medical incidents have risen; waiting times have lengthened, and public satisfaction over our public healthcare services has fallen to a new low in my own survey. There is clearly a lack of trust for the government. This lack of trust for the government is not just shared by the man-in-the-street. Professor Francis Lui of the Hong Kong University of Science and Technology also preferred a cash handout. But the glaring fact that our healthcare services need to be boosted remains. These days we generally acknowledge that the SAR government had fallen short in its housing supply for about a decade. But we should also acknowledge that the supply of hospital beds has fallen short and so has the supply of residential care services for the elderly and handicapped. It is high time we catch up on these

fronts. We must not just talk and talk about “caring and sharing” with no action and no funding to back it up. I was appalled to find that the financial secretary proposed “increasing 2,469 subvented rehabilitation service places and purchasing an additional 500 private RCHD (residential care homes for persons with disabilities) places.” In view of the huge shortfall behind actual needs this can only be said to be symbolic.

The government needs to do something that is more visible in order to salvage the decline in public trust. I am glad to see that the government is now committing much more resources on healthcare, but my concern is that the loss of experienced doctors and nurses to the private sector could be worsened by the impending launch of the Voluntary Health Insurance Scheme. I had warned before that such a scheme will not pay off in terms of relieving pressures from public hospitals, as experienced medical staff will leave along with patients with relatively minor problems. Patients with chronic problems and complications will stay with the public hospitals. The effort to increase intake of students in medical and nursing schools will not help much.

I am pleased with the various efforts to

boost the economy and particularly major funding initiatives to boost research and innovation. But I am not so happy about the narrow view of education primarily as a means of nurturing talents and boosting the competitiveness of our economy. There is just one mention of mental health and that is paragraph 147, which reads: “the Department of Health will promote mental health and enhance public education to minimize stigmatization”. But schools certainly have a large role to play in promoting mental health. My own research has produced strong evidence that life education in schools makes a huge difference on students’ happiness, and that schools in practice often undermine happiness because they focus too much on academic performance. Stronger effort has to be made to ensure schools offer a more balanced curriculum that treats students as human beings. I am concerned that the prevalent proposal of “one social worker for one school” could be counter-productive as teachers might be led to think that all personal development issues should be referred to “the professionals”, when actually each teacher needs to be caring and loving and concerned about whole-person development of his or her students.