The 2012-13 Budget
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The 2012-13 Budget  

Safeguard People’s Livelihood


  • Recurrent government expenditure for 2012–13: $60 billion (+7%)illustration
  • The increase in the recurrent expenditure will be used in implementing the four-year undergraduate programmes under the new academic structure by the University Grants Committee-funded institutions, increasing university places, introducing small-class teaching in public primary schools, continuing to launch the Pre-primary Education Voucher Scheme and increasing the value of the voucher etc.
  • Earmark $1 billion to implement a new programme modelled on Project Yi Jin under the new senior secondary academic structure.
  • Allocate $2.5 billion to launch the sixth Matching Grant Scheme which will cover all statutory and approved post-secondary institutions.
  • Make two separate injections of $1 billion each, into the HKSAR Government Scholarship Fund and Self-financing Post-secondary Education Fund, to establish more scholarships or award schemes.
  • Allocate $5 billion to Research Endowment Fund to enhance the academic and research development of tertiary institutions.

Medical and Health Services

  • Recurrent government expenditure for 2012–13: $45 billion (+8%)
  • Allocate $2.54 billion to the Hospital Authority to meet community demand for medical services, including efforts to attract and retain talents so as to provide quality healthcare services to patients, expansion of the coverage of the Hospital Authority Drug Formulary, enhancing primary medical services, improving mental health services, increasing in-patient service capacity and strengthening neonatal intensive care service.
  • Provide $2.2 billion for clinic and hospital projects, including the expansion of the United Christian Hospital, redevelopment of Yan Chai Hospital, Kwong Wah Hospital and Queen Mary Hospital. Allocate $500 million to procure and revamp medical facilities.illustration
  • Inject $10 billion into the Samaritan Fund so that more people will benefit from the subsidy and patients already receiving the assistance will have the burden of drug expenses further eased.

Social Welfare

  • Recurrent government expenditure for 2012–13: $44 billion (+9%)
  • The increase in the recurrent expenditure will be used in implementing the provision of public transport concessions for the elderly and eligible people with disabilities, strengthening the support for infirm and demented elders, increasing the amount of supplements for residential care homes for demented elderly, providing additional 1,000 subsidised residential care places and community care services, improving the quality of more than 600 subsidised places in residential care homes for the elderly under the Enhanced Bought Place Scheme.
  • Allocate $900 million to improve the physical settings and facilities of as many as 250 district elderly community centres, neighbourhood elderly centres and social centres for the elderly across the territory.

Relief Measures

To help ease the pressure on the community brought about by an economic downturn, the following measures will be introduced:

  • Provide an extra allowance, equal to one month’s payment, to CSSA recipients, Old Age Allowance and Disability Allowance recipients.
  • Pay two months’ rent for public housing tenants.
  • If necessary, allocate $100 million to extend short-term food assistance services.
  • Grant each residential electricity account a subsidy of $1,800, benefitting 2.5 million households.illustration
  • Waive rates for 2012–13, subject to a ceiling of $2,500 per quarter for each rateable property. It is estimated that almost 90% of properties will be subject to no rates in the year. This proposal will cost the Government $11.7 billion.

  • illustrationReduce salaries tax and tax under personal assessment for 2011–12 by 75%, subject to a ceiling of $12,000. This proposal, benefitting 1.5 million taxpayers, will cost the Government $8.9 billion.
  • Propose various tax measures: raising the basic allowance to $120,000 and married person’s allowance to $240,000; increasing the allowance for maintaining a dependent parent or grandparent aged 60 or above to $38,000; raising the child allowance to $63,000; raising the dependent brother/sister allowance to $33,000; raising the disabled dependent allowance to $66,000; extending the entitlement period for the tax reduction for home loan interest to 15 years of assessment and increasing the maximum tax deduction for mandatory contributions to Mandatory Provident Fund schemes to $15,000. These measures will cost the Government $3.5 billion a year.
  • Give all student loan borrowers who complete their studies in 2012 the option to start repaying their student loans one year after completion of studies. This will alleviate the financial burden of fresh graduates.

Strengthening Our Social Capital

  • Hong Kong Mortgage Corporation will introduce a three-year pilot scheme of microfinance. The maximum loan amount will be capped at $100 million and the repayment period will be as long as 5 years.
  • Inject $200 million into the Community Investment and Inclusion Fund to promote social capital development.
  • Subject to the views of the Steering Committee on the Commmunity Care Fund (CCF), the Government shall decide to incorporate the appropriate programmes launched by the CCF into the regular assistance programmes. Corresponding financial arrangements will be made when necessary.

Invest in the Future

Promoting Development of Industries

  • Promote the development of the retail bond market. A further issuance of iBond worth not more than $10 billion will be launched.
  • Allocate $150 million to the Mega Events Fund and extend its operation for 5 years.
  • Increase the cash rebate under the R&D Cash Rebate Scheme, raise the funding ceiling of the Small Entrepreneur Research Assistance Programme and increase the monthly allowance of the Internship Programme under the Innovation and Technology Fund.
  • Introduce measures to encourage the use of industrial buildings and industrial lots for data centres.
  • Set up a fund of $1 billion to help Hong Kong enterprises tap the Mainland market.

Infrastructural Development

  • illustrationThe total value of infrastructural projects approved and to be submitted to the Legislative Council is worth $400 billion, $62.3 billion of which is the annual actual expenditure on capital works for 2012–13.
  • Large-scale projects include the Hong Kong section of the Guangzhou-Shenzhen-Hong Kong Express Rail Link, the Hong Kong-Zhuhai-Macao Bridge, the Central-
    Wan Chai Bypass, railway construction works of the South Island Line (East) and
    the West Island Line, and Shatin to Central Link project.
  • illustrationTake forward projects of various scales at the district level, including the expansion of Tseung Kwan O Hospital, redevelopment of Caritas Medical Centre, construction of North Lantau Hospital, building the first indoor velodrome in Tseung Kwan O, redeveloping the Victoria Park, Lai Chi Kok Park and Kwun Tong Swimming Pools, expansion of Ko Shan Theatre, and building community facilities such as community halls, sports centres, libraries and parks in various districts.
  • Consider the proposal of building the third airport runway.

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