2013 budget hit record surplus of 0.6% of GDP

Expenditure was lower than expected.

According to the Asian Development Bank, since 2004, Hong Kong’s budget has recorded surpluses cumulatively amounting to $60.3 billion, providing substantial fiscal reserves at a time when higher social expenditure seems inevitable.

The budget for FY2013 (ended 31 March 2014) was no exception, recording a surplus of 0.6% of GDP.

Here’s more from ADB:

Revenues rose to HK$447.8 billion, 3% more than projected, as additional land was sold for housing.

Expenditure of HK$435.8.billion was lower than budgeted by HK$4.2 billion, though recurrent expenditure growth has averaged 8.5% in the past 3 years, with a huge chunk of that allotted to education, health care, and social welfare.

Fiscal prudence has been the hallmark of government policy in Hong.Kong, China. The budget has not been in deficit since the global financial crisis, and the government has amassed reserves sufficient to finance more than 20.months of government expenditure.

In the past 5 years, actual budget surpluses have substantially exceeded the budgeted amounts. This small, open economy is particularly susceptible to fluctuations in the global economy and other external factors.

Its major sources of revenue, such as profit tax, land premiums, and stamp duty, have been highly volatile and susceptible to fluctuation.