3.6 Cable and Wireless Services: Higher costs to public funds because of the Government's decision to exclude the Urban Council from the equipment servicing arrangements provided to the Government. (Paragraph 3.2(f) of P.A.C. Report No. 7). The Committee wish to be informed of further progress on this subject. In particular they wish to know whether a conclusion has been reached on the interpretation or amendment of the current Technical Service Agreement between the Government and Cable and Wireless (H.K.) Ltd. and whether it has been decided to include the Urban Council so as to reduce the overall cost to public funds. The Committee also wish to be informed if the new agreement is not to come into force on 1 April 1986.
3.7 Weaknesses in financial and technical control and the inability of the Government to monitor effectively the activities of the power companies in the implementation of the capital and maintenance programmes for public lighting. (Para- graph 3.2(h) of P.A.C. Report No. 7). In their previous report the Committee noted that until firm decisions were taken and an agreement was signed with each of the two power companies a satisfactory degree of control and effective monitoring would not be achieved.
3.8 The Committee note that a formal agreement with the China Light and Power Co. Ltd. is now expected to come into effect in April 1986. The Committee also note that this formal agreement will be used as a model for negotiating a similar agreement with the Hong Kong Electric Co. Ltd. and that, in the meantime, bi-monthly meetings between the Engineering Development Department and the Hong Kong Electric Co. Ltd. are being held with a view to securing further improvements in financial and technical controls.
3.9 Delay in clearing the advance account for work done by the Water Supplies Department on behalf of the Housing Authority. (Paragraph 3.2(1) of P.A.C. Report No. 7). The Committee note that the balance in the advance account has fallen from $3.51 million in September 1984 to $3.06 million in June 1985. The Committee have been informed that revised draft billing procedures have been drawn up by the Director of Accounting Services in order to reduce further the balance of the advance account. The Committee understand that the revised draft billing procedures have been accepted by the Director of Water Supplies and the Director of Housing subject to the resolution of certain administrative problems affecting the Director of Housing.
3.10 Overpayments to the security contractor at Kai Tak Airport by the Director of Civil Aviation in the absence of a formal and efficient profit control system. (Paragraphs 6.1-6.5 of P.A.C. Report No. 7). In considering paragraph 32 of the Government Minute of March 1985, the Committee laid emphasis on the need to ensure that the proposal to try to maintain a profit margin of 14.4% was pursued forthwith and suggested that the Director of Accounting Services should be consulted in the process.
3.11 The Committee understand that the Director of Civil Aviation is still pursuing proposals for the airlines to assume greater responsibility for supervising the security contractor's charges and profit margins so as to reduce the Government's involvement; that the Attorney General and the Director of Accounting Services have agreed to these proposals; that recent consultations with the Airline Operators Committee have produced a generally favourable response and that, subject to further discussion on detailed aspects of the proposals, it is hoped to secure implementation in early 1986.
3.12 The Committee have been informed that, meanwhile, the Director of Civil Aviation is arranging with the contractor to provide audited accounts in respect of 1984 and 1985 for the sterile security area so that payments can be adjusted to allow for a 14.4% profit. However these arrangements are not yet complete as it is first necessary for the contractor to isolate his costs for the sterile security area from his other costs.
3.13 Overassessment of janitor staff and cleaning grants for aided secondary schools and the Government's failure to ensure that the surplus money was properly invested or otherwise not mis-used. (Paragraphs 6.14-6.21 of P.A.C. Report No. 7). The Committee note that the Director of Education has advised the major school councils of his decision to reduce the level of the janitor staff and cleaning grants in three phases, the first phase with effect from 1 April 1985, and the second phase with effect from 1 April 1986. The Committee also note that the Director of Education has advised the major school councils of his decision to recover the surpluses above the three-month ceiling.
3.14 The Government Minute which was laid before the Legislative Council in March 1985 states that the Administration was considering the Committee's recommendation in paragraph 6.19 of their Seventh Report that revisions to the block grants should not be automatically linked to revisions in civil service salaries. In the Committee's view, this leads to accumulation of surpluses in the schools and consequently defeats the purpose of the present scheme. The Committee wish to be informed whether the Administration has reached any conclusion with regard to the Committee's recommendation and, if not, of the progress in this matter.
3.15 Delays in the opening of the Aberdeen and Airport Tunnels because of problems associated with the development of the computer systems in respect of traffic surveillance and control, resulting in substantial financial losses to the Government. (Paragraphs 6.31–6.48 of P.A.C. Report No. 7). The Committee have been informed that the Director of Engineering Development has not yet completed the task of drafting departmental instructions for incorporation into the civil engineering manual to reflect the recommendations set out in paragraphs 6.44, 6.46, 6.47 and 6.48 of the Committee's Seventh Report.
3.16 The Committee note that there are still defects in the computer systems for the tunnels and that meetings between the Government, the consultants and the contractors for the two tunnels continue to be held in an endeavour to reach agreement on the outstanding matters. The Committee understand that it may be necessary to wind up the contracts by negotiating reduced payment to the contractors for certain elements of their work which cannot be made to meet the contract specification.
7