TNAG-2325-FCO40-3369-Hong-Kong-Bill-of-Rights-policy-1991 — Page 104

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THE PUBLIC SERVICE

109

cils, and the Hong Kong Management Association. Similarly most of the schools, and many of the hospitals, charitable organizations, and volun- tary organizations in the colony are heavily subvented by government, often to the extent of their total costs. Approximately 20 per cent of total government expenditure is disbursed in subventions of various kinds. Groups aided range from the Society for the Prevention of Cruel- ty to Animals (which rounds up stray dogs and destroys them where necessary, or arranges for their care or adoption) to the Road Safety Association (for propaganda and the organization of Road Safety Pat- rols for children) and the Discharged Prisoners' Aid Society. It is gener- ally cheaper for government to subvent voluntary agencies than to pro- vide the services directly itself, since the terms of service for voluntary agency staff are generally less generous than those of government ser- vants: such staff do not normally qualify for such allowances as those for housing and education, and for overseas leave and training courses.

Finally there are the public utilities: the bus, ferry, and tram com- panies, the gas and electricity companies, and the telephone, radio, and television companies. These public companies have all been granted a statutory monopoly by government and, in exchange for this franchise, "are subject to various restrictions on the fares and fees charged to the public and over the level of return permitted to shareholders.11 Most are subject to a scheme of control and are required to maintain a devel- opment fund into which excess profits are paid. Some utilities are also required to pay a royalty (which may be waived) and to have government-appointed directors on their boards. The conditions im- posed on each franchise holder vary in detail, but in almost all cases government has experienced considerable difficulties in exercising effec- tive control over the companies' operations to ensure that service to the public takes precedence over the interests of shareholders. In other countries such utilities have been nationalized, the shareholders bought out or otherwise compensated, and the enterprise run as a statutory corporation. This was the solution recommended by the 1959 Report of the Electricity Supply Commission but government rejected it. At pre- sent government is attempting to improve its methods of monitoring the performance of these utilities, particularly the electricity companies and the bus companies which have been the target of frequent public criti- cism. Whenever a franchise comes up periodically for renewal, govern- ment seeks to tighten the controls and impose more stringent conditions on the companies, since the government is blamed for their inefficien- cies, but lacks the means to force them to make improvements (short of the ultimate sanction of a refusal to renew their franchise-an action which would present government with the difficult problem of finding a replacement or taking the company over completely). For exactly the same reason, a threat of refusal to approve applications for fare in- creases, which normally require the agreement of the Governor in Council, is not credible, since the government could not allow the com- panies to go bankrupt.