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In response to media enquiry on a press report about "over-spending" by some Bureaux, a Finance Bureau spokesman today (Wednesday) said that there was no question of any bureaux or departments spending "out-of-control".

"Any suggestion that excessive spending by bureaux and departments has led to the recorded deficit of $50.1 billion for the first seven months of this financial year is erroneous," the spokesman said.

"To the contrary, total spending by bureaux and departments under the General Recurrent Account for the first half of this financial year of $92.8 billion was only 46% of the approved provision of $200 billion for the year," he added.

The spokesman explained that expenditure for each bureau and department was authorised in accordance with provisions in the Public Finance Ordinance. The Annual Expenditure Estimates are approved by the Legislative Council upon enactment of the Appropriation Ordinance.

"No changes can be made to the approved Estimates in the course of the year except with the approval of Finance Committee or under authority delegated by Finance Committee. Changes to Estimates approved under delegated authority are reported regularly to Finance Committee," he noted.

"Our system of controlling and managing government expenditure is both open and transparent. We are fully accountable to the Legislature on the use of public funds," the spokesman added.

Commenting on the increase in spending by some bureaux in the first six months of 1999-2000 over the same period in 1998-99, the spokesman explained that the 1999-2000 expenditure estimate was planned on the basis of growth, not cutbacks, to meet increases in demand.

The year-on-year growth for individual bureaux or departments is affected by their planned initiatives, many of which are accounted for in the 1999-2000 Estimates approved by the Legislative Council.

The spokesman advised, however, that it would not be too meaningful to compare year-on-year growth taking into account non-recurrent spending.

"By definition, non-recurrent expenditure is incurred for one-off items and is lumpy in nature. You need to spend this year but probably not the previous year," he said.

"We believe that the public has a right to know the fiscal position. Hence we are publishing the financial results in a timely manner. To facilitate reporting, we are happy to render assistance to the media in helping them understand the financial and accounting arrangements," the spokesman added.

End/Wednesday, December 1, 1999

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