Page 91 of 498
Page 91 of 498
88
HONG KONG URBAN COUNCIL
MR. CHIANG SAI-CHEONG (in Cantonese):—Mr. Christopher CHUNG'S question is in fact very constructive. In fact, many members have raised similar questions before. The proposal can certainly be considered, no problem at all.
CHAIRMAN (in Cantonese):—I think maybe the Finance Select Committee will consider this formally and devise some options for the endorsement of the Standing Committee of the Whole Council. This is a matter of great importance. We have been resorting to depositing in banks all along. In fact, we now have many derivative tools such as the exchange fund bills which can earn more interest. This point is worthy of more detailed studies. Are there any more follow-up questions? Yes, Mr. SUEN Kai-cheong and Mr. Ambrose CHEUNG Wing-sum, in that order.
MR. SUEN KAI-CHEONG (in Cantonese):—A question for the Chairman of the Finance Select Committee. At present, money not required to be used immediately are grouped together and deposited with various licensed banks. I would like to know if there are any open selection criteria under the existing machinery? Which criteria do we adopt in deciding which bank to make a deposit with? Are there situations of unfair business competition?
MR. CHIANG SAI-CHEONG (in Cantonese):—Thank you, Mr. SUEN. Mr. Chairman, in fact, the Finance Investment Panel of the Finance Select Committee holds regular monthly meetings to discuss the utilization of the Council reserve. At each meeting in the past, we discussed in detail the amount of money to be placed with different banks and in what ways, for example overnight, one month or three-month deposits. We did consider the above situation and we studied the reliability and stability of the banks. We usually placed deposits mainly with overseas banks. Many banks wrote in to the Council from time to time to express hopes for the Council to deposit reserve sums with them. There were such cases. We sometimes included new banks in the list too. If members of the public are interested to apply for the Council to place deposits with them, they can contact the Council at any time. Of course, we would need to examine cases in accordance with our detailed criteria.
MR. AMBROSE CHEUNG WING-SUM (in Cantonese):—Mr. Chairman, two questions from me. Firstly, has the Finance Select Committee considered whether our surplus is reasonable? Secondly, how are we going to make good use of our current surplus in the range of $2.6 billion? I hope the Finance Select Committee will deliberate on these two points. Furthermore, the Urban Council should not consider itself to have discharged its duty by investing the $2.6 billion for a better return. My questions are based on the data given in the appendix.
In only 4 of the 23 past years, deficits of the Council ranging from $20 million to over $300 million were reported. That is observation no. 1. Observation no. 2 is that the Council had a surplus of $700 million in 1991, but over the last 4 to 5 years, the surplus has escalated to $2.6 billion. Observation no. 3 is that, when
Page 91 of 498
Page 91 of 498
498