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Total public expenditure is forecast to grow in 1999-2000 by 4.3 % over
the revised estimate for 1998-99 (for details, see Analysis of Total
Public Expenditure by Policy Area Group). Within this overall growth total government
expenditure will increase by only 2.4%. This relatively low level of growth
in government expenditure arises because of exceptional one-off payments
in 1998-99, totalling $8.95 billion, in respect of the setting up costs of
the Mandatory Provident Fund Authority and the payment of compensation to
Hong Kong Telecom International for the surrender of its exclusive licence.
If these two exceptional payments are discounted the year-on-year growth in
government expenditure would amount to 6.7%.
The significant items of capital expenditure contributing to the growth in
total public expenditure are:
Community and External Affairs (+9.5%)
Capital expenditure for this policy area is forecast to increase by 18.9% in real
terms as a result of increased expenditure by the Provisional Urban Council.
Economic (-35.3%)
The reduction in spending is entirely attributable to the exceptional one-off payments
made in 1998-99 in respect of the setting up of the Mandatory Provident Fund Authority and
to Hong Kong Telecom International for early surrender of its exclusive licence.
Education (+7.9%)
Capital spending on Education is forecast to rise by 20.7% in real terms over 1998-99.
Major items of expenditure in 1999-2000 include construction of additional primary and
secondary schools, improvement works to existing primary and secondary schools and construction
of student hostels.
Environment (-10.6%)
The reduction reflects the reduced spending on the Outlying Islands refuse transfer station and
on landfills.
Health (+4.5%)
Capital expenditure on Health will rise by 17.2% in real terms largely as a result
of Phase 2 of the redevelopment of Castle Peak Hospital.
Housing (+11.9%)
The increase reflects the growth in capital expenditure by the Housing Authority on
construction projects.
Infrastructure (+6.6%)
The increase reflects the additional expenditure in the year on highways projects and the
payment of two further loan instalments to Guangdong Provincial People's Government for water
quality improvement works.
Security (+6.8%)
Capital expenditure in this policy area will increase by 38.9% in real terms reflecting
additional expenditure on police station improvements, police force computerisation projects,
magistracies and disciplined services quarters.
Social Welfare (+13.7%)
The increase reflects additional spending on the purchase and fitting out of social welfare
premises together with increased expenditure from the Lotteries Fund.
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