Financial Secretary Paul Chan revised the estimates for 2018-19, with a surplus of $58.7 billion predicted.

Unveiling his 2019-20 Budget at the Legislative Council today, Mr Chan said the revised estimate for government revenue in 2018-19 is $596.4 billion, 1.3% lower than the original estimate mainly due to lower-than-expected income from land premium and stamp duties.

The income from land premium is $115.9 billion, $5.1 billion less than expected mainly due to the unsuccessful tendering of two sites.

Stamp duty revenue is $80 billion, $20 billion less than the original estimate, with smaller-than-expected trading volumes from adjustments in the property and stock markets.

However, he said revenue from profits and salaries taxes are $16.1 billion higher than expected.

The revised estimate for government expenditure is $537.7 billion, 5.6% less than expected due to spending on policy initiatives and public works projects being lower than estimates.

Mr Chan forecast a surplus of $58.7 billion for 2018-19 with fiscal reserves expected to reach $1.16 trillion by March 31 this year.

For 2019-20, Mr Chan said total government revenue is estimated to be $626.1 billion, with income from land premium and stamp duties accounting for $143 billion and $76 billion.

Operating expenditure is forecast to be $501.5 billion, up 15.4% from a year earlier.

Recurrent expenditure, which accounts for more than 80% of operating expenditure, will rise 9% to $441 billion.

The finance chief said within the $441 billion, about 60% or more than $250 billion will be spent on education, social welfare and healthcare.

The Government will also boost its manpower, with the civil service establishment to expand about 1.8% to about 191,820.

Mr Chan forecast a surplus of $16.8 billion in the Consolidated Account in the coming year.

There is no structural change in the Government’s financial position, Mr Chan said, adding he remains cautiously optimistic about the forecast for the coming five years.