Opportunities will decide the fate of Hong Kong SMEs

At the end of his budget speech, John Tsang Chun-wah recited the lyrics of a Canto-pop song, Crossroads: "Believe in opportunity, not fate." It reminds me of former financial secretary Antony Leung Kam-chung's use of lyrics from another Canto-pop classic, Below the Lion Rock, to conclude his maiden budget in 2002. Both recall Hong Kong's tough times in the late 1970s and 1980s.

However, the two songs rouse the spirit in different ways. Below the Lion Rock reminded Hong Kong people of how everyone had struggled to make an honest living with no welfare benefits provided, "encouraging each other and helping each other". By contrast, Crossroads focuses on personal growth, and appeals for a revival of the can-do and self-reliant spirit.

Some say the era is long gone when Hong Kong people could succeed through hard work. That's also why Tsang's decision to cut down on "sweeteners" in his budget has stirred debate.

The "sweeteners" offered in the past years seemed to be aimed at easing people's financial pressures following the global financial crisis in 2008. The giveaways became something everyone thought they deserved, and a guessing game ensued each year about how much the government would offer.

Welfare should be allocated in a more targeted way. Thus, it was responsible of the government to roll back some of the giveaways while committing resources to help those most in need - the working poor, elderly and minority groups - over the long term.

The Hong Kong economy is at a crossroads. The economic situation has improved and the city has near full employment. However, as Tsang warned, a structural deficit could surface in seven years if government expenditure keeps growing and outpacing economic and revenue growth. This growing expenditure includes the permanent welfare measures proposed by Chief Executive Leung Chun-ying in his policy address and the increase in health care costs amid a rapidly ageing population.