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UNDER EXISTING PRACTICE, SUBVENTED ORGANISATIONS ARE GENERALLY REQUIRED TO CONTRIBUTE A MINIMUM OF 20 PER CENT OF THE ESTIMATED COST OF MEDICAL PROJECTS AND GOVERNMENT CAPITAL SUBVENTIONS DO NOT NORMALLY EXCEED 80 PER CENT OF THE COST.

TWENTY PER CENT OF THE ESTIMATED COST OF THIS PROJECT AMOUNTS TO SOME $51.5 MILLION. THE HOSPITAL HAS SO FAR RAISED 322 MILLION, AND IS CONFIDENT OF RAISING AT LEAST $12 MILLION MORE.

FINANCE COMMITTEE WILL BE ASKED TOMORROW TO CONSIDER MAKING AN EXCEPTION TO THE 20 PER CENT TO 80 PER CENT RULE, AND TO APPROVE A CAPITAL GRANT OF $223.7 MILLION FOR THE DEVELOPMENT PROGRAMME SUBJECT TO THE FOLLOWING CONDITIONS:

* THAT THE HOSPITAL WILL TRY ITS BEST TO

RAISE ADDITIONAL SUMS WITH THE AIM OF REDUCING THE CAPITAL SUBVENTION REQUIRED, AND

* THAT THE HOSPITAL EXTENSION SHOULD BE

DESIGNED AND CONSTRUCTED IN A MANNER ACCEPTABLE TO THE GOVERNMENT TO ENSURE ECONOMICAL AND EFFECTIVE USE OF PUBLIC FUNDS.

INCLUDED IN THE PROPOSAL IS THE CONDITION THAT NO GOVERNMENT SUBVENTION WILL BECOME PAYABLE UNTIL THE YAN CHAI HOSPITAL HAS SPENT $34 MILLION ON THE PROJECT.

OTHER ITEMS TO BE CONSIDERED AT TOMORROW'S MEETING INCLUDE:

* ADJUSTMENT OF PAY AND ALLOWANCES FOR

THE AUXILIARY POLICE FOLLOWING THE PAY RISE FOR THE CIVIL SERVICE,

*RETROSPECTIVE APPROVAL FOR TWO ENVIRONMENTAL

IMPROVEMENT PROJECTS IN SHAM SHUI PO AND KOWLOON CITY WHERE COSTS HAVE EXCEEDED THE APPROVED LIMIT, AND AN INCREASE IN THE

FINANCIAL LIMIT FOR ENVIRONMENTAL IMPROVEMENT AND COMMUNITY INVOLVEMENT PROJECTS,

* EX-GRATIA PAYMENTS FOR TWO RETIRED CIVIL

SERVANTS,

ADVANCING THE