TNAG-1486-FCO40-2040-Public-finance-in-Hong-Kong-1986 — Page 13

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Paragraphs 6.55 - 6.62 Slow progress and delays in taking action on formulating a detailed policy on the subventing of Insurance premiums and in devising a system by which the various risks can be covered at minimum cost

The Standing Committee

servants

on the Administration of Subventions has advised

advised that there are legal and policy difficulties both in providing an indemnity to subvented organizations and in taking out a consolidated insurance policy on behalf of subvented organizations. It is therefore intended that the Government should cease to subvent premia for fire and professional malpractice insurance and instead carry the risk of fire (initially in schools only), and give assurances to professional medical staff in subvented organizations similar to those given to government

regarding legal assistance and liability for any damages and costs awarded. It is also intended that the Government should continue to subvent premia for employees' compensation and public liability insurance but would seek to negotiate via an insurance broker a block discount rate which subvented organizations would be able to take advantage of in taking out individual policies based on an assessment of their own needs. Controlling Officers have been invited to take the necessary steps to introduce these new arrangements which are expected to be more cost-effective than the present arrangements.

Paragraphs 6.63 6.67

Raising productivity

restraining growth in departmental establishments

and

Value for money steering groups have been set up in Housing Department, Regional Services Department, Urban Services Department, Medical & Health Department and Electrical & Mechanical Services Department. It is intended gradually to create steering groups in other departments as Finance Branch resources become available to service them.

There are currently fifteen value for money studies in progress and there are no major difficulties in commissioning, conducting and implementing studies at this time.