$558b In Expenditure Forecast

Government expenditure for 2018-19 is expected to reach $557.9 billion.

Financial Secretary Paul Chan made the prediction in his Budget Speech today, saying the Government will spend $113.7 billion on education, $92.2 billion on social welfare and $78 billion on healthcare.

The Government's recurrent expenditure will reach $406.5 billion, a year-on-year increase of 11.8%.

Education, social welfare and healthcare accounts for 60% of the Government's recurrent expenditure.

Mr Chan estimated total Government revenue for 2018-19 to be $604.5 billion, mainly from profits tax, land premiums and stamp duties.

The Government will have an estimated surplus of $138 billion in 2017-18.

"I will carefully take into account the source and nature of the surplus, and make optimal allocation of resources in the light of the external and local economic environment, social needs and public expectations.

"This year, I will follow the same principle by sharing with the community about 40% of the projected annual surplus and using the remaining for improving services and investing in the future."

He said this year's budget has adopted strategies to match the Chief Executive's fiscal philosophy of optimising the use of the surplus to invest for Hong Kong and relieve people's burden.

Strategies include promoting economic development by providing favourable conditions for emerging industries such as I&T, and strengthening the competitiveness of pillar industries.

He said he will make bold investments to break through development bottlenecks and improve existing services and quality of life.

The Budget also looks to meet the community's long-term needs for healthcare and elderly care.

While maintaining the competitiveness of the tax regime, Mr Chan said he will make suitable adjustments to ease the burden on taxpayers and enterprises.

The Budget has also adopted the strategies of caring for the community as well as maintaining adequate fiscal reserves.