Secretary for Constitutional Affairs Stephen Lam says the Government has no intention to set barricades on Hong Kong's democratic development, but he warned that democracy should not lead to a welfare state.

Speaking after the Strategic Development Commission's Committee on Governance & Political Development meeting today, Mr Lam said the ultimate goal of universal suffrage, maintaining a low tax regime and a balanced budget, are the principles stipulated in the Basic Law.

"For the time being, Hong Kong's public finances are rather prudent. We have been able to adhere to our own guideline of keeping public spending within 20% of GDP. On the whole, the situation is pretty well under control now. We have also been able to eradicate deficits, which have been accumulated over last several years. In the meantime, we can maintain a low tax regime," he said.

"But as we journey down the path to introducing universal suffrage, whether it is going to be a directly elected Chief Executive, or a fully elected Legislative Council, the members of the council and the executive government will face public pressure, much in the same way as western politicians and political parties. They will face pressure to introduce more benefits for the public."

Hong Kong people sensible

Noting Hong Kong people are sensible and will not expect an unrealistic level of Government benefits, Mr Lam said when pursuing the aim of universal suffrage, people should maintain the city's good finances and facilitate the development of a capitalist economy at the same time. He said there is no polarity between democracy and a capitalist economy, adding the latter should not be taken as a barricade to constitutional development.

Central Policy Unit Head Lau Siu-kai said committee members are of the view that a balanced participation may help ensure the important principles of fiscal balance, and pursuing the ultimate goal of universal suffrage. He said the Government will consider views garnered from different sectors before coming to a conclusion.

Mr Lam said committee members underlined their support and their agreement on the principles as stipulated in the Basic Law, including the ultimate goal of introducing universal suffrage while at the same time keeping financial prudence, fiscal balance and a low tax regime, at the meeting.