TNAG-1415-FCO40-1896-Public-finance-in-Hong-Kong-1985 — Page 169

139.

The Public Accounts Committee again examined the subject at a public hearing in November 1984 at which the Deputy Financial Secretary gave evidence. The Deputy Financial Secretary explained that one of the reasons for the delay was the need to rethink the policy on the matter, which was complicated, and there were intricate legal questions to be resolved. The Committee emphasized that the Government was reimbursing in full the cost of the insurance premiums paid by the subvented organizations and it was important to ascertain whether the present arrangement was the most cost-effective. It seemed to the Committee that it was a simple matter to decide, yet little basic research had been done; even if it was found that a single consolidated policy was useless, at least it would have been found out why it was useless and what the disadvantage was against the advantage. The Committee expressed their concern that what appeared to be a relatively straightforward problem had taken more than four years of deliberation, without any achievements in terms of insurance premiums saved. The Committee noted the commitment given by the Deputy Financial Secretary to reconvene the Standing Committee on the Administration of Subventions and to put forward a proposition to it within six months.

140.

The latest position is that:

the controlling officers of education, social welfare and medical subventions have examined the existing arrangements for the subvention of insurance premiums; and

proposals are under consideration for the Government to carry the risk of loss or damage by fire on schools and hospitals and to take out consolidated insurance policies against claims for employees' compensation in the subvented sector.

I am informed that interim proposals will be put to the Standing Committee on the Administration of Subventions in the next few months.

141.

Head 42 - Electrical and Mechanical Services Department. Subheads 002 and 113. Allowances and Administration. The Kevin Industrial Building housing the Electronics Division of the Electrical and Mechanical Services Department was extensively damaged during the passage of Typhoon Ellen in September 1983. In addition

to the repair work, it was considered necessary to strengthen the building to enable it to withstand typhoons and strong winds to protect the expensive electronics equipment kept there and the Deputy Financial Secretary approved the inclusion of an item in the Public Works Programme at an estimated cost of $1,470,600.

The