Budget Framework Law Inching Ahead

With a final vote of 23 in favour, with two against and one abstaining, the bill amending the current budget framework law was passed in principle and now moves on to be debated article by article. The vote in favour came despite the majority of legislators speaking at yesterday’s Legislative Assembly (AL) meeting, which included representatives of the Secretariat for Economy and Finance as well as Secretary of Economy and Finance Lionel Leong Vai Tac, expressing that the proposal is incomplete, leaving vague areas including attribution of responsibility and function of the Legislative Assembly in the oversight process.
“This is just a formative document. I will vote in favour but I hope that the Secretary (Leong) and his colleagues can later present us with the administrative regulations that will accompany this law so that we can learn how the government will apply this law at an operational level,” said indirectly elected legislator Chui Sai Cheong.
One consensus arrived at between legislators and government was that the law, unchanged for years, is outdated.
“This has been eagerly awaited by all. We see the current situation we have doesn’t fit with the actuality of society,” said Chief Executive-appointed Mak Chi Seng.
However, despite the long wait, not all the expected advances were made, according to the legislators.
“We waited for this for over 10 years,” said directly elected legislator Au Kam San, “Was there improvement? Yes, but it doesn’t correspond with the expectations of the people.” Mr. Au was referring in particular to public discontent over large construction projects running over budget and execution rates of zero per cent on infrastructure projects.
Mr. Au, who together with directly elected legislator Ng Kuok Cheong made up the two votes against the passing of the proposal, urged for an additional clause requiring the government to “have projects very well prepared” before being presented to the Legislative Assembly, a sentiment echoed by directly elected legislator Ho Ion Sang.
“For me, the evaluation on the front end is the most important,” said Mr. Ho. “If it is very well done – work that falls on the government, which counts on professionals for the creation of the budget […] if it is (well elaborated upon) – the data presented to the AL will be more precise,” he concluded.

Get it right at the beginning
The proposal involves four areas of oversight: during the creation of the budget, the management of the budget, the execution of the budget, and the evaluation of its results; with some legislators commenting that more transparency for the public will increase the effectiveness of oversight.
“The essential I think is to increase the transparency of the budget execution in order to satisfy the needs of the population to control the budgets of the MSAR,” said directly elected legislator Angela Leong On Kei, suggesting the involvement of an additional third party, aside from the public, AL members and government, to present parallel reports on the budget execution throughout the year.
Indirectly elected legislator Vitor Cheung Lup Kwan even suggested involving non-resident workers to create and execute budgets effectively.
“We can’t only use local professionals. If there’s a lack of talent we can hire them from outside to do the job well. We cannot accept that the public services present a bill and we have to accept it,” said the legislator.
Secretary Leong listened to the critiques, and sporadic praise from the legislators, guaranteeing to take them into account during the second stage of evaluation of the law proposal.
“There’s much preoccupation in terms of the work we need to do on the front end so that there is information, clarification and we’re more transparent,” said the Secretary. “This way […] the AL can know what the objectives are for a certain fund and how it’s spent.”
Mr. Leong also noted that even if elaborated upon budgets for the year don’t evenly balance between revenue and cost, the government can dip into the “financial reserve as a resource to finance and achieve the equilibrium of the budget.”
In addition, at the beginning of the AL session, members rejected a vote appeal aimed at pushing Chief Executive Chui Sai On to begin a political reform process to allow for universal suffrage in the 2019 Chief Executive elections.