THE ECONOMY
April 1, 2002. The two concessions together produced total savings of $7.6 billion for ratepayers.
The Rating and Valuation Department is also responsible for the billing and collection of government rent which is payable from July 1, 1997 for land leases. granted on or after May 27, 1985, and on the extension of non-renewable land leases. The latter comprise all land leases in the New Territories and New Kowloon north of Boundary Street which were renewed on June 28, 1997. Government rent is levied at 3 per cent of the rateable value of the lot and is adjusted in step with any subsequent changes in the rateable value. There were about 1 452 000 assessments in the Government Rent Roll as at March 31, 2002. The total government rent collected in 2001-02 was $4.6 billion.
The Government derives significant amounts of revenue from other sources. Fees and charges for services provided by government departments generated about $10.9 billion, or about 6 per cent of total revenue, in 2001-02. It is government policy that fees should in general be set at levels sufficient to recover the full cost of providing the services. Certain essential services are, however, subsidised by the Government or provided free of charge. Government-operated public utilities generated about $3.4 billion which accounted for about 2 per cent of the total revenue; the most important of these, in revenue terms, is water charges. The Government has frozen most Government fees and charges since February 1998 as an exceptional measure to ease the burden on the community at a time of economic setback. The local economy underwent a downward adjustment in 2001. To avoid adding to the burden of the community, the Financial Secretary announced in the 2002-03 Budget that the moratorium on revision of government fees and charges would continue until the end of March 2003. To provide further relief to households and businesses, the Financial Secretary also announced in the 2002-03 Budget that water and sewage charges would be waived for one year, subject to maximum amounts set at $800 and $200 respectively for domestic households and $3,200 and $800 respectively for non- domestic consumers. The Government also waived fresh water flushing charges for one year, subject to a maximum amount set at $800, reduced the trade effluent surcharge by a flat rate of 30 per cent for one year and waived business registration fees for one year. All these concessions produced total savings of $2.6 billion for households and businesses.
Also, in 2001-02, the Government collected $0.9 billion, amounting to about 0.5 per cent of the total revenue, from investments and interest income on the fiscal reserves. Lastly, some $10.3 billion, or about 6 per cent of the total revenue in 2001-02, was generated from land transactions. All revenue from land transactions is credited to the Capital Works Reserve Fund to help finance the Public Works Programme.
Government Supplies Department
Purchases of goods and related services required by government departments are undertaken centrally by the Government Supplies Department, which provides similar services to certain non-government organisations, including the Hospital Authority. These goods and related services are normally obtained by competitive tendering, without giving preference to any particular source of supply, to ensure that users' needs are met at the best possible price, having regard to life-time cost and reliability of supply. Helping users to derive the best value in their purchases, the department formulates a specific strategy for each type of purchase based on market conditions,
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