insurers an obligation in certain circumstances to pay to a non-profit making hospital, the expenses reasonably incurred by such a hospital in providing medical treatment to victims of traffic accidents. It came to my notice in 1971 that although this statutory liability had then existed for some twenty years, it had never been enforced, and in October of that year I invited the attention of the Finance Branch of the Government Secretariat to the resultant loss of revenue to Government hospitals (which based on subsequent calculations may, over the period of the non-enforcement of the legislation, have amounted to several million dollars) and suggested that con- sideration should be given both to enforcing the law and to raising the prescribed maximum recoveries to a level more in keeping with present-day costs. After considerable correspondence and some difference of opinion on whether it would be worthwhile implementing the relevant provisions of the Ordinance, the Organization and Methods Division of the Finance Branch was asked, in November, 1974, to look into the matter. Their ensuing report, completed in January, 1976, concluded that enforcement of the legislation in respect of hospital in-patients would be relatively simple and of financial benefit and endorsed my earlier suggestion for an increase in the maximum liability which could be incurred. It was conservatively estimated that recoveries at present rates would amount to nearly $400,000 per annum and at the recommended increased rates, to over $1.25 million per annum. I understand that action is now being taken with a view to implementing the recommendations of the report with effect from 1st July, 1977.
14. Head 8-Fees and Receipts. Subhead 580. Parking. The loss of parking meter revenue from various causes has long been the subject of concern and whilst it is recognized that the nature of the loss is such that it is unlikely to be eradicated completely, over the years considerable efforts have been made by the Transport Department and the Royal Hong Kong Police Force to keep it within bounds. In paragraph 18 of my report for 1972-73 I observed that the annual rate of loss at that time appeared to have stabilized and that although the situation could not be regarded with equanimity, it was probably as satisfactory as could be expected. More recently however, a rapid deterioration in the position has been noted and some estimates of the loss now suggest that it amounts to well over $2 million per annum. Whilst the theft of money from the coin boxes of meters is prevalent, the main problems arise from the use of foreign coins and spurious objects to activate the meters and from their deliberate jamming with wire and other devices. Discussions have taken place on measures which might be taken to increase the security of meters and on alternative methods of levying on-street parking charges which may not be so susceptible to loss, but there seems to be little doubt that in at least the foreseeable future, the main deterrent to both theft and malpractice must be increased vigilance and surveillance on the streets.
15. Head 10—Land Sales. Subheads 010 and 030. Premia on new leases—sales by public auction and tender/ private treaty grants: Urban area. It is unfortunately the case that from time to time successful bidders at sales of Crown land are unable to meet the resultant contractual obligation to complete their purchase and when this occurs they either seek to be relieved of that obligation or occasionally, proving to be men of straw, simply default. In the case of one sale, made in March, 1974 at a premium of $10,567,320 payable by instalments, the purchaser, having paid a deposit of $500,000, was unable to meet the first instalment when it fell due and asked to be released from his contract. In acceding to this request Government reserved the right, on resale of the land, to recover any deficiency between the resale price and the original price. A deficiency of $5,307,320 did eventuate when the land was resold in January, 1975, but no action to recover this amount appeared to have been initiated until after the matter had been brought to notice in audit in March, 1976. Similarly in another case, whilst there was no question of withdrawal or default by the grantee, no action was taken to demand the premium of $1,067,430 stated in the conditions of grant until the failure to do so was raised at an audit inspection three months after the payment had fallen due. In the event it seems that the premium may now be abated, but nevertheless the sum recoverable will still be substantial. Although both of these cases were excep- tional in that the action required fell outside the normal procedures of the Crown Lands and Survey Office, it must be a cause for some concern that the transactions were not accorded the degree of care which would seem to have been warranted by the magnitude of the sums involved.
16. Occasionally it is found that land granted by private treaty to a public utility company in accordance with approved policy is unsuitable for the purpose for which it was acquired and in such cases it is open to Government either to enforce the contract or to accept a surrender upon such conditions as may be deter- mined. An audit review of one case in which surrender was accepted indicated that the terms for the surrender notified to the utility company had been misinterpreted by the company in a manner which could have led to a loss of revenue of over $100,000 in any future grant of land for a similar purpose. Following this observation the misinterpretation was corrected and the possibility of the loss thereby eliminated but I have suggested to the Secretary for the Environment that to avoid a similar situation arising in the future, it would be desirable to formulate rules for dealing with cases of this nature. I understand that these are now being drafted.
17. Head 10-Land Sales. Subhead 060. Premia on modification of existing leases, exchanges and extensions: New Territories. Amongst several underassessments of premia for the extension of building covenant periods brought to notice in audit, was one of $115,150 which occurred because of delay by the New Territories Administration in advising District Officers of a change in the rules governing the assessment of premia,
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