ENG-1993-02-24 — Page 1

HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 2069 OFFICIAL RECORD OF PROCEEDINGS

Wednesday, 24 February 1993

The Council met at half-past Two o'clock

PRESENT

THE PRESIDENT

THE HONOURABLE JOHN JOSEPH SWAINE, C.B.E., LL.D., Q.C., J.P.

THE CHIEF SECRETARY

THE HONOURABLE SIR DAVID ROBERT FORD, K.B.E., L.V.O., J.P.

THE FINANCIAL SECRETARY

THE HONOURABLE NATHANIEL WILLIAM HAMISH MACLEOD, C.B.E., J.P.

THE ATTORNEY GENERAL

THE HONOURABLE JEREMY FELL MATHEWS, C.M.G., J.P.

THE HONOURABLE ALLEN LEE PENG-FEI, C.B.E., J.P.

THE HONOURABLE STEPHEN CHEONG KAM-CHUEN, C.B.E., J.P. THE HONOURABLE MRS SELINA CHOW LIANG SHUK-YEE, O.B.E., J.P. THE HONOURABLE HUI YIN-FAT, O.B.E., J.P.

THE HONOURABLE MARTIN LEE CHU-MING, Q.C., J.P.

THE HONOURABLE DAVID LI KWOK-PO, O.B.E., J.P.

THE HONOURABLE NGAI SHIU-KIT, O.B.E., J.P.

THE HONOURABLE PANG CHUN-HOI, M.B.E.

THE HONOURABLE SZETO WAH

THE HONOURABLE TAM YIU-CHUNG

THE HONOURABLE ANDREW WONG WANG-FAT, O.B.E., J.P.

THE HONOURABLE LAU WONG-FAT, O.B.E., J.P.

THE HONOURABLE EDWARD HO SING-TIN, O.B.E., J.P.

THE HONOURABLE MARTIN GILBERT BARROW, O.B.E., J.P.

2070 HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 THE HONOURABLE MRS PEGGY LAM, O.B.E., J.P.

THE HONOURABLE MRS MIRIAM LAU KIN-YEE, O.B.E., J.P. THE HONOURABLE LAU WAH-SUM, O.B.E., J.P.

DR THE HONOURABLE LEONG CHE-HUNG, O.B.E.

THE HONOURABLE JAMES DAVID McGREGOR, O.B.E., I.S.O., J.P. THE HONOURABLE MRS ELSIE TU, C.B.E.

THE HONOURABLE PETER WONG HONG-YUEN, O.B.E., J.P. THE HONOURABLE ALBERT CHAN WAI-YIP

THE HONOURABLE VINCENT CHENG HOI-CHUEN

THE HONOURABLE MOSES CHENG MO-CHI

THE HONOURABLE CHEUNG MAN-KWONG

THE HONOURABLE CHIM PUI-CHUNG

REV THE HONOURABLE FUNG CHI-WOOD

THE HONOURABLE FREDERICK FUNG KIN-KEE

THE HONOURABLE TIMOTHY HA WING-HO, M.B.E., J.P. THE HONOURABLE MICHAEL HO MUN-KA

DR THE HONOURABLE HUANG CHEN-YA

THE HONOURABLE SIMON IP SIK-ON, J.P.

DR THE HONOURABLE LAM KUI-CHUN

DR THE HONOURABLE CONRAD LAM KUI-SHING

THE HONOURABLE LAU CHIN-SHEK

THE HONOURABLE EMILY LAU WAI-HING

THE HONOURABLE LEE WING-TAT

THE HONOURABLE GILBERT LEUNG KAM-HO

THE HONOURABLE ERIC LI KA-CHEUNG, J.P.

HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 2071 THE HONOURABLE FRED LI WAH-MING

THE HONOURABLE MAN SAI-CHEONG

THE HONOURABLE STEVEN POON KWOK-LIM

THE HONOURABLE HENRY TANG YING-YEN, J.P.

THE HONOURABLE TIK CHI-YUEN

THE HONOURABLE JAMES TO KUN-SUN

DR THE HONOURABLE SAMUEL WONG PING-WAI, M.B.E., J.P. DR THE HONOURABLE PHILIP WONG YU-HONG

DR THE HONOURABLE YEUNG SUM

THE HONOURABLE HOWARD YOUNG, J.P.

THE HONOURABLE ZACHARY WONG WAI-YIN

DR THE HONOURABLE TANG SIU-TONG, J.P.

THE HONOURABLE CHRISTINE LOH KUNG-WAI

THE HONOURABLE ROGER LUK KOON-HOO

THE HONOURABLE ANNA WU HUNG-YUK

ABSENT

THE HONOURABLE RONALD JOSEPH ARCULLI, J.P.

THE HONOURABLE MARVIN CHEUNG KIN-TUNG, J.P.

IN ATTENDANCE

THE HONOURABLE MRS ANSON CHAN, C.B.E., J.P.

SECRETARY FOR ECONOMIC SERVICES

MR MICHAEL LEUNG MAN-KIN, C.B.E., J.P.

SECRETARY FOR TRANSPORT

MR YEUNG KAI-YIN, C.B.E., J.P.

SECRETARY FOR THE TREASURY

2072 HONG KONG LEGISLATIVE COUNCIL — 24 February 1993

THE HONOURABLE JOHN CHAN CHO-CHAK, L.V.O., O.B.E., J.P. SECRETARY FOR EDUCATION AND MANPOWER

MR MICHAEL SUEN MING-YEUNG, J.P.

SECRETARY FOR HOME AFFAIRS

MR ALISTAIR PETER ASPREY, O.B.E., A.E., J.P.

SECRETARY FOR SECURITY

MR JAMES SO YIU-CHO, O.B.E., J.P.

SECRETARY FOR RECREATION AND CULTURE

THE HONOURABLE MICHAEL SZE CHO-CHEUNG, I.S.O., J.P. SECRETARY FOR CONSTITUTIONAL AFFAIRS

MR ANTHONY GORDON EASON, J.P.

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS

MRS SHELLEY LAU LEE LAI-KUEN, J.P.

SECRETARY FOR HEALTH AND WELFARE

THE CLERK TO THE LEGISLATIVE COUNCIL

MR CLETUS LAU KWOK-HONG

HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 2073 Sessional Papers 1992-93

No. 58 — Li Po Chun Charitable Trust Fund Annual Report

for the Period 1 September 1991 to 31 August 1992

No. 59 — Trustee's Report on the Administration of the

Education Scholarships Fund

for the year ended 31 August 1992

Oral answers to questions

Abandoned vehicles

1. MR CHIM PUI-CHUNG asked (in Cantonese): Regarding the problem of vehicles being abandoned at various locations in Hong Kong, will the Government inform this Council of the following:

(a) the latest number of abandoned vehicles and how it compares with that of the same time last year;

(b) the departments which are responsible for the disposal of abandoned vehicles and their respective duties; and

(c) whether it has any plans to review the existing practice for the disposal of abandoned vehicles and to introduce effective measures to deal with the problem, for example, requiring registered car owners who do not seek renewal of their vehicles' licence upon expiry to prove to the Administration within a specified period that the vehicles have been properly disposed of?

SECRETARY FOR TRANSPORT: Mr President, on the first part of the question:

(a) 283 abandoned vehicles were removed in the last quarter of last year, compared with 86 in the same period of 1991.

On the second part of the question:

(b) Three departments are involved. For vehicles abandoned on government land, the Buildings and Lands Department requires owners to move them by a certain date. If this is not done, the vehicles are towed away. Vehicles abandoned on public roads are handled by the police in a similar way.

2074 HONG KONG LEGISLATIVE COUNCIL — 24 February 1993

In addition, the Transport Department operates two car surrender centres offering a free disposal service for old cars. The department also monitors the activities of a car-crushing yard operated by a government contractor, where abandoned vehicles are delivered for scrapping.

On the last part of the question:

(c) It is present policy to provide facilities for owners to dispose of old vehicles lawfully when they are no longer roadworthy. This policy works well. Most owners either take their old vehicles to one of the surrender centres or sell them to private scrapyards. Only a small proportion of unserviceable vehicles are abandoned. There are no plans to change the existing practice.

The suggestion that owners be required to prove that their vehicles have been properly disposed of if they do not renew their vehicle licence has been considered before. However, non-renewal of a vehicle licence does not necessarily mean that the vehicle has been disposed of. For example, the owner could be absent from Hong Kong for a long time or the vehicle may be under repair. To establish the reasons for non-renewal of a licence in each case would require time-consuming investigation, which is not justified by the scale of the problem.

MR CHIM PUI-CHUNG (in Cantonese): Mr President, we learnt from the Secretary's reply that firstly the number of abandoned vehicles in 1992 is 230% higher than that of 1991 and secondly as three departments are involved in the task, it is close to a situation where "everybody's business is nobody's business". Will the Administration make public the practical measures it will take to resolve the problem? I fail to see what has made giving an answer so difficult on such a minor issue when Hong Kong can do so well and is so successful in other areas.

SECRETARY FOR TRANSPORT: Mr President, I refute the implications evident in the first part of Mr CHIM's question. The departments involved are working under strict regulations and clear instructions. There is no overlapping of work or lack of efficiency. With regard to the first part of the question, the number of abandoned vehicles has increased because of a backlog in the past years. The police mounted a special operation during last year to clear the backlog. This explains the increase in the last year.

HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 2075

MR SIMON IP: Mr President, our beautiful countryside is being raped by the indiscriminate dumping of vehicles, especially in the New Territories, and this is quite evident when one drives along the roads in the New Territories. Would the Secretary for Transport please explain what is being done to remedy the situation?

SECRETARY FOR TRANSPORT: Mr President, I believe this is a matter on land use planning and I would defer to the Secretary for Planning, Environment and Lands.

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, thank you. There are two situations as regards the use of land in the New Territories for such activities as the dumping of vehicles or other storage uses of this kind. The first situation is that in the areas covered by the 31 development permission areas in respect of which plans have been published in the last year or so, the use of land for this purpose needs to be the subject of an application to the Planning Department. And when applications of this kind are made, if they are made in areas which have been designated for open storage use, they can be approved under conditions which will control the form of the use and such other matters as prevention of environmental degradation. The second category is those dumps which have existed prior to the introduction of the new town planning legislation in the last couple of years, which enables us to impose development permission areas. In these cases where land is already used for the dumping of vehicles — or the storage of vehicles which, I think, is probably the more appropriate description — the existing uses are under the plan and as such they are, of course, not subject to the controls which are now available for new dumps. These existing dumps and other existing uses which require better control cannot be brought under control until we have the next stage of new town planning legislation, which we hope to introduce into this Council within the next year or so.

MR JIMMY McGREGOR: Mr President, would it not be more efficient to contract out the entire job of collecting abandoned vehicles wherever they are located and disposing of same by scrapping, as is done through the contractor at present? Would this not free the police from the endeavour of a good deal of collection work, which could be put to good use elsewhere?

SECRETARY FOR TRANSPORT: Mr President, I believe that at the present time quite a number of operators are already doing the same thing by offering a free pick-up service for disposal of these abandoned vehicles in their own scrap yards. I think the Government will consider whether collection and disposal

2076 HONG KONG LEGISLATIVE COUNCIL — 24 February 1993

need to be further improved and also the possibility of hiving off the operation to these scrap yard operators.

MR WONG WAI-YIN (in Cantonese): Mr President, I lodged a complaint with the Police last October concerning a long-abandoned container truck. It took altogether four months which was a few days ago for the authority to tow away the vehicle. Is this situation similar to the one referred to in Mr CHIM Pui-chung's question? May I ask how long it will take for a government department to tow away a vehicle once a complaint has been received?

SECRETARY FOR TRANSPORT: Mr President, under the law, the departments concerned, such as the police, may remove a vehicle within seven days of a notice offering two weeks for disposal of the vehicle. But the practice varies and I would need to find out the relevant statistics and reply to Mr WONG in writing. (Annex I)

Indepedent office to investigate complaints against police

2. MR WONG WAI-YIN asked (in Cantonese): Will the Government inform this Council whether consideration will be given to setting up an independent office to investigate complaints against the police; if not, what the reasons are?

SECRETARY FOR SECURITY: Mr President, we have carefully considered whether we should establish an independent office to investigate complaints against the police. We have concluded that we should retain the present system of investigation by the Complaints Against the Police Office, comprising police officers under a separate chain of command from the rest of the police force.

Complaints against the police usually allege breaches of the criminal law, or of police discipline or procedure. Investigation of these complaints requires a knowledge of police policies and procedures. Professional judgement is required as to whether the actions of the police officer under investigation are justified in the circumstances of the case. Police officers, working for the Complaints Against the Police Office, have the necessary knowledge and expertise to undertake these sorts of investigations.

We do not believe it would be viable or effective to establish an independent office, comprising non-police investigators, outside the police force. It would be difficult to recruit an adequate number of professional, non-police investigators of the right calibre, who would understand the nature of police work sufficiently.

HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 2077

The work of the Complaints Against the Police Office is monitored by the Police Complaints Committee, which is an independent committee appointed by the Governor. The Committee oversees investigations into police complaints closely to ensure that they are carried out impartially. The advice of the Committee is that investigations carried out by the Complaints Against the Police Office have been both fair and thorough. The Committee has recently put forward a number of recommendations to improve the existing system for monitoring complaints and to enhance public confidence in the system. We are now considering these recommendations.

MR WONG WAI-YIN (in Cantonese): Mr President, this morning I was on duty at the Complaints Division of the Legislative Council, and I was supposed to have an interview with the customs officers assaulted by the police days ago had it not been cancelled yesterday. I do not know if they were "talked into" not making a complaint. In the past, quite a number of people who had lodged complaints with CAPO said to me that, very often when they filed a complaint, the duty officer in CAPO would say to them that "The complaint procedure is very troublesome"; "The complaint will lead you nowhere"; "You are unlucky then"; "Don't bother it or it will just waste your time" in a bid to dissuade or discourage them from lodging a complaint. In fact, some CAPO officers whom I know confessed to me that, most of them are not willing to handle the case for fear that .....

MR ANDREW WONG: Point of order, Mr President.

PRESIDENT: What is your point of order, Mr Andrew WONG?

MR ANDREW WONG: It is not a question, Mr President.

PRESIDENT: Well a Member is permitted to make a statement, within reason, to make the question intelligible. I assume you are coming to your question, Mr WONG Wai-yin?

MR WONG WAI-YIN (in Cantonese): They are afraid of future embarrassment of seeing these fellow colleagues again when they are posted out to district police stations. May I ask the Secretary what can be done to dispel their worries?

2078 HONG KONG LEGISLATIVE COUNCIL — 24 February 1993

SECRETARY FOR SECURITY: Mr President, the officers working for the Complaints Against the Police Office work under very detailed procedures. They are reminded of the need to seek co-operation from complainants and I do not believe that there can be any question of their trying to put off complainants, either for the reason that Mr WONG alleges or for any other reason.

MRS ELSIE TU: Mr President, in view of the small percentage of cases admitted to be substantiated by CAPO, would the Secretary for Security agree that justice should not be sacrificed on the excuse that independent experts are difficult to recruit?

SECRETARY FOR SECURITY: Mr President, I would certainly agree that there should be no excuse for failure to do justice. I believe that justice is being done.

MR SIMON IP: Mr President, would the Secretary for Security agree that the Police Complaints Committee would be a more effective body if it were allowed to investigate complaints directly or to reinvestigate cases which had already been investigated by CAPO, rather than to conduct paper reviews of investigations carried out by CAPO?

SECRETARY FOR SECURITY: Mr President, I believe that the procedure of the Police Complaints Committee is very thorough. They review all cases. I accept that the present Police Complaints Committee has made a number of recommendations by which their procedure could be improved and which they think would perhaps increase public confidence in the system. We are now considering these various recommendations.

MR SIMON IP: I am sorry, Mr President, but my question has not been answered. PRESIDENT: Would you repeat the question, Mr IP?

HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 2079

MR SIMON IP: My question, Mr President, was: would the Secretary for Security not agree that the Police Complaints Committee would be a more effective body if it were allowed to investigate directly complaints or reinvestigate complaints that had been investigated by CAPO, rather than to carry out a paper review of investigations conducted by CAPO?

SECRETARY FOR SECURITY: No, Mr President, I would not agree. I believe the present system is very effective.

MR ERIC LI: Mr President, I think the world outside the police force is moving rapidly towards an era of inviting lay members to help matters of professional discipline. The Hong Kong Society of Accountants, for example, is actively pursuing this course and the Operations Review Committee of the ICAC is another shining example. The second and third paragraphs of the reply by the Secretary would seem to imply that only people who have professional knowledge can serve on this committee. Can the Secretary explain whether in his opinion it is beyond the reasonable intelligence of non-force members, for example lawyers, to sit on this committee?

SECRETARY FOR SECURITY: Mr President, could I ask for clarification as to what committee we are referring to?

MR ERIC LI: I am referring to the committee that investigates complaints against police. I think in the second and third paragraphs of the answer it is stated that one has to have the necessary knowledge and expertise to undertake these sorts of investigations and the third paragraph goes on to say that it would be difficult to recruit a member with such expertise.

SECRETARY FOR SECURITY: Mr President, I believe that in many areas, perhaps in most areas, one's peers are often more critical and fairer judges of one's conduct than anybody else and I believe that the police officers investigating the actions of their fellow police officers do so impartially and fairly and that certainly is the advice we have had from the Police Complaints Committee. I believe that the investigation of the sort of complaints that are made against police does require professional investigation knowledge and the police force has the ability to do that. There are, of course, several members from the community, appointed by the Governor, to sit on the Police Complaints Committee to review the investigations and to ensure that they are properly and fairly carried out.

2080 HONG KONG LEGISLATIVE COUNCIL — 24 February 1993

MR STEPHEN CHEONG: Mr President, can the Secretary advise this Council whether or not the current complaints group, the lay members, have conducted a separate investigation in any of the cases that come under their review? It is because when I was a member of an OMELCO police group, we did at random take cases out and did further investigation ourselves to confirm that the investigation by CAPO had been impartial and that the results were as presented in the report. Would the Secretary advise whether or not the current members of the group who look after the complaints do this? If not, I think the suggestion should be that they should do it.

SECRETARY FOR SECURITY: Mr President, I do not believe that the Police Complaints Committee or any members of the Police Complaints Committee conduct investigations as such. That is certainly not in their terms of reference. Their terms of reference are to monitor and to review. They do, of course, very often, send a case back for further investigation and further information.

MR MARTIN LEE: Mr President, bearing in mind that only a tiny percentage of complaints against the police have been substantiated, does the Administration not think that it is in the inherent interest of the great, great majority of the police officers themselves, against whom complaints have been made but which complaints are later dismissed, that they be exonerated from blame, not by their own colleagues in the police force but by independent investigators?

SECRETARY FOR SECURITY: Mr President, I can only repeat what I said in my main answer that I believe the present system is fair and thorough and impartial and works well.

MR MARTIN LEE: Mr President, that is a repetition of not answering. PRESIDENT: Do you wish to repeat the question, Mr LEE?

MR MARTIN LEE: Yes, Mr President. Does the Administration not see that it is in the interests of the police officers themselves that they be exonerated from blame by independent investigators so that justice is manifestly seen to be done to them?

HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 2081

SECRETARY FOR SECURITY: Mr President, I think I have already answered that question. The answer is no.

MR ANDREW WONG: Mr President, would the Government consider replacing monitoring by the Police Complaints Committee with monitoring by the Commissioner for Administrative Complaints?

SECRETARY FOR SECURITY: Mr President, I do not believe that the Office of the Commissioner for Administrative Complaints could undertake this job without a complete change in its method of operation and its establishment. I believe that the Commissioner for Administrative Complaints at present deals with about 150 cases a year; there are over 3 000 complaints against the police and they do all require investigation. But the Commissioner for Administrative Complaints is an ex-officio member of the Police Complaints Committee and he does participate in the monitoring and review of the CAPO investigations.

MR ANDREW WONG: Sorry, Mr President, I think the Secretary has misunderstood my question. I said monitoring of CAPO; I did not say CAPO, but monitoring by the Police Complaints Committee and replacing that monitoring with monitoring by the Commissioner for Administrative Complaints, that is, doing a monitoring role and not really doing investigations.

SECRETARY FOR SECURITY: Mr President, I am sorry I misunderstood. I thought Mr WONG was suggesting that the investigation should be done by the Commissioner for Administrative Complaints. No, we believe that the Police Complaints Committee is an effective monitoring body but, as I have said, it does have on it the Commissioner for Administrative Complaints, who is an ex-officio member of the Police Complaints Committee.

Police suicide

3. DR HUANG CHEN-YA asked (in Cantonese): Will the Government inform this Council:

(a) whether the suicide rate in the police was higher than that in other disciplined services in the past three years;

2082 HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 (b) of the reasons for such suicides; and

(c) of the measures available to prevent police officers from committing suicides?

SECRETARY FOR SECURITY: Mr President, in the past three years, a total of 15 police officers died after committing suicide. During the same period, there were three suicides in the Fire Services, one in the Correctional Services, one in the Customs and Excise Department and none in the Immigration Department. However, the strength of the police force, at around 27 000, is much larger than that of the other disciplined services. I have given details in the Annex which has been tabled.

Financial difficulties, family problems, interpersonal relationships and physical and mental illness are some of the known causes for these suicides; many result from a combination of factors.

A number of measures are available to help prevent officers from resorting to suicide. Courses on stress and financial management are offered to police officers as part of their training. Officers are also given advice on how to identify suicidal tendencies among themselves, their colleagues and their subordinates.

Police officers, or their families, who require counselling can obtain it from the welfare officers and clinical psychologists in the force. Early intervention is emphasized, before the problems develop to such an extent that they could lead to suicide. The availability of these counselling services has been widely publicized within the force.

Officers whose circumstances suggest that they might be under considerable stress and, therefore, prone to suicide, are given special attention. Appropriate assistance is sought from their families, colleagues or formation commanders. This assistance might include restricting the officers' access to firearms and transferring them to less stressful posts.

HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 Suicide rate of officers in disciplined services

C&E CSD FSDPolice

B

A

C

B

A

C

B

A

C

B

A

Year

2 801 0

0

5 801 0

0

6 972 0

0.011% 26 980

3

1990

2 847 1

0.016% 5 959 1

0.014% 6 995 1

0.011% 26 403

3

1991

2 866 0

0

6 391 0

0.029% 6 999 2

0.034% 26 430

9

1992

2 838 1/3

0.006% 6 050 1/3

0.014% 6 987 1

0.019% 26 604

5

Average

No. of suicide cases A:

Strength at beginning of year B:

Suicide rateC:

2084 HONG KONG LEGISLATIVE COUNCIL — 24 February 1993

DR HUANG CHEN-YA (in Cantonese): Mr President, apparently the suicide rate in the Police Force is higher than that of the other disciplined services, but the Secretary says that police officers can obtain assistance from the welfare officers and the clinical psychologists in the Force. Can that really solve the problem? Will that, for example, help those out who are in financial difficulties? Are there enough manpower for the task and is enough time given for each interview? All these are very important questions. Can the Secretary inform this Council of the number of counsellors involved, the number of police officers being counselled each month and its success rate?

SECRETARY FOR SECURITY: Mr President, I think it is difficult to draw too many conclusions from the statistics over a relatively short period of time which I have tabled. It is true that the average suicide rate for police officers is very slightly higher than that of some of the other disciplined services. It is not necessarily higher in each of the past three years. I think that one case in one of the services has a tremendous effect on the figures and I think that we should not draw too many conclusions from them.

Turning to the point about the services available, the counselling service, we believe, is effective in preventing suicides and in helping police officers who have problems. During the past three years, for example, the welfare officers and the clinical psychologists have offered professional assistance to 26 police officers who have attempted suicide and they have counselled many other cases where there may have been an inclination towards suicide. None of these officers have made any subsequent attempts to commit suicide. The Force Psychological Services Group is staffed by two psychologists and they provide a range of services including training courses for stress management, counselling sessions and interviews with officers. I believe that the services they provide are very valuable and are effective, but I also believe that the Commissioner of Police does have plans to increase the unit slightly.

MR STEVEN POON: Mr President, the police suicide rate in 1992 was 3.4 cases for every 10 000 persons, which is three times the figure in 1990 and 1991. Would the Administration inform us of the reasons for the large increase and how this rate compares with the suicide rate of the general public?

SECRETARY FOR SECURITY: Mr President, as I have said, I do not think it is very useful to try to draw firm conclusions from the statistics over a limited period. There was certainly a substantial increase in the number of suicides in the police force in 1992 but this may well be only a yearly fluctuation; it cannot necessarily be considered conclusive of any definite trend. There have been similar blips in the past; for example in 1980, there were nine suicide cases in the police force but that figure was then very much less in subsequent years. I am sorry, Mr President, I think there was a second part of the question which I cannot recall.

HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 2085

PRESIDENT: Comparison of, I think, suicide rates among the general population, if you have the answer, Secretary.

SECRETARY FOR SECURITY: Yes, Mr President, the suicide rate among the general population in recent years. I do not have the figures for 1992, but in recent years the suicide rate has been 0.012%, which is slightly below the average rate in the police force, but only very slightly below it. I think I should say also here that I am not sure that one can draw any valid comparison anyway. The figure I have given is a very crude figure for the whole population; it does not mirror the age, sex, educational and other particulars and attributes of the members of the police force.

MR ALBERT CHAN (in Cantonese): Mr President, the increase in the number of suicides in the Police Force in 1992 is a cause for concern. According to a number of media reports, indebtedness due to gambling is the cause of suicides for some police officers. Can the Administration inform this Council whether assistance has been given to the police officers concerned in the light of this? If so, what kind of assistance is given?

SECRETARY FOR SECURITY: Mr President, certainly, indebtedness has been a factor in some cases, but heavy indebtedness, including pressure from loan sharks for example, has not been identified as a significant reason for suicides in the police force in recent years. But there are within the Government well established procedures for assisting officers who do get into debt.

MR MICHAEL HO (in Cantonese): Mr President, in the third paragraph of the Administration's reply, it was mentioned that "courses on stress and financial management are offered to police officers as part of their training". Does this indicate that police suicide is related to financial management, and how can these courses be able to assist police officers to alleviate their pressure that might have led to suicides?

SECRETARY FOR SECURITY: Mr President, as I said in answer to the last supplementary, certainly indebtedness and worries about finances is sometimes a factor in some of these cases and I think, as I also said in my main answer, that guidance to police officers is given in this respect, both in their initial training and subsequently if they approach the force welfare officer or others for assistance.

MR SIMON IP: Mr President, is the Secretary for Security able to tell us which of the causes that he has listed in the second paragraph of his answer is the main cause for police suicides?

2086 HONG KONG LEGISLATIVE COUNCIL — 24 February 1993

SECRETARY FOR SECURITY: Mr President, I regret that I do not know. I think, as I said, it is often a combination of factors and I am not sure that it is possible to identify one single factor. But I will try and give a written answer. (Annex II)

Inflation

4. MR DAVID LI asked: Will the Administration inform this Council what action is planned to further reduce the rate of inflation in the coming fiscal year, in view of the fact that Hong Kong's inflation rate is still notably high compared with other regionally competitive economies and our major markets?

SECRETARY FOR ECONOMIC SERVICES: Mr President, my answer will be brief as I do not wish to anticipate the Financial Secretary's Budget speech in this Council next week when he will comment on the state of the economy, including inflation.

The Administration fully share Members' concern over high inflation. But as we have made clear on various occasions, there is no quick and easy cure. We must be careful not to introduce measures that might seem superficially attractive in the short term but which could inflict lasting damage on our economy.

Consumer price inflation has moderated considerably from the peak of 13.9% recorded in April 1991. Although the Consumer Price Index (A) last month climbed to 10.1%, this is likely to be a temporary relapse primarily due to the influence of the lunar new year. The underlying situation has not worsened.

As Members are aware, the measures available to the Government for curbing inflation are limited. We remain committed to keeping public expenditure under control, ensuring adequate supply of labour and land, promoting efficiency and competition, enhancing our human resources through education and training, and discouraging property speculation.

MR DAVID LI: Mr President, referring back to the Governor's policy address, the Governor stated that improved efficiency is the Government's most useful weapon in the battle against inflation. Will the Administration inform this Council of the results of a search for savings in its efforts to root out waste and inefficiency as part of its plans to reduce the rate of inflation?

SECRETARY FOR ECONOMIC SERVICES: A point of clarification, Mr President. Does Mr LI refer to measures within the Civil Service?

HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 2087 MR DAVID LI: Yes, Mr President.

SECRETARY FOR ECONOMIC SERVICES: Mr President, I am not of course aware of all the details but I can say, generally, that the question of achieving efficiency and achieving savings is a continuing commitment on the part of the Government. We do so by regular reviews of the way in which the Government conducts its business, through public sector reforms and by ensuring that, where possible, privatization is considered in order to improve productivity and efficiency.

MR GILBERT LEUNG (in Cantonese): Mr President, in the light of the huge surplus in the current financial year, will the Administration inform this Council if it will reconsider freezing the charges of government services in order to curb inflation?

SECRETARY FOR ECONOMIC SERVICES: Mr President, the Government did, of course, in previous years introduce a moratorium when inflation was relatively high in an effort to curb inflationary pressures. In doing so, we must of course also have regard to the fact that in general we would wish services at least to cover costs, and I can assure this Council that in considering any further increases in government services we will of course very much have regard to its impact on inflation.

DR SAMUEL WONG: Mr President, in the last paragraph of the reply, the adequate supply of land was cited as one of the measures available to curb inflation. Could the Administration confirm if the current rate of land production is adequate? If not, what is the remedy?

SECRETARY FOR ECONOMIC SERVICES: Mr President, can I defer to my colleague the Secretary for Planning, Environment and Lands?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, I think the present rate of land production is adequate.

MR MARTIN BARROW: Mr President, could the Secretary clarify what she means by an adequate supply of labour? Does she think it is adequate, and what steps does the Government plan to take to ensure that the supply of labour continues to be adequate?

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SECRETARY FOR ECONOMIC SERVICES: Mr President, I am sure Mr BARROW is well aware of the Government's policy on importing labour in order to ensure that there is an adequate supply. The quota for the importation of labour will of course be kept under regular review to ensure that the shortage of labour does not add to inflationary pressures.

MR TAM YIU-CHUNG (in Cantonese): Mr President, the Administration would set up inter-departmental working groups or invite experts to join such groups when there are difficult problems to resolve. May I ask if the Administration is prepared to do likewise in its efforts to curb inflation?

SECRETARY FOR ECONOMIC SERVICES: Mr President, the Administration is generally satisfied that its existing channels of communication and source of advice are adequate to ensure that we keep a close watch over the situation.

DR HUANG CHEN-YA (in Cantonese): Mr President, now that our economy is service industry-led, but inflation in this sector is relatively difficult to contain, does the Administration have any plans to help increase the productivity of this industry so as to reduce its inflationary pressure?

SECRETARY FOR ECONOMIC SERVICES: Mr President, one of the key solutions to the question of improving productivity and efficiency in the service sector relates of course to the very question that we touched on earlier, that is, the adequate supply of labour. This is a matter that the Government is keeping under regular review, and the importation of labour scheme is designed to relieve the pressure on labour shortage.

MR ALBERT CHAN (in Cantonese): Mr President, in the last paragraph of the main answer, the Administration mentioned a series of measures to tackle and reduce inflation. It also stated that it would continue to keep public expenditure under control. Has the Administration considered controlling charges (such as licence fees) as far as possible so as to avoid pushing up inflation as a result of such increases?

SECRETARY FOR ECONOMIC SERVICES: Mr President, as I have said in an earlier answer to a supplementary question, we do keep under regular review the need to increase charges for government services and are particularly concerned that we should keep to a minimum its impact on inflationary pressures. I can also add that in the current round of fee increases this will of course also be uppermost in our minds. But as far as we can estimate at this stage, collectively, anticipated fee increases are not expected to add significantly to the inflationary rate.

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MR CHIM PUI-CHUNG (in Cantonese): Mr President, we all know that there are many factors leading to inflation and they include, among other things, transport and electricity fee increases. In granting franchises in the future, can the Administration reduce to the minimum the permitted return of a franchised company (because the interest rate now is very low indeed)? Has the Administration considered this practicable measure to curb inflation?

SECRETARY FOR ECONOMIC SERVICES: Mr President, I can assure this Council that in considering any application from a public utility company for a fee increase, we will wish, of course, to be satisfied that there is adequate justification for the fee increase, and in taking into account the adequate justification the impact on inflation will of course also be considered.

MR HENRY TANG: Mr President, in her main reply the Secretary said that there should be an adequate supply of labour to keep down the pressure on inflation. Does the Secretary have any proof that the importation of labour so far has kept down inflation or actually has reduced inflation?

SECRETARY FOR ECONOMIC SERVICES: Mr President, I believe that the evidence of the impact of allowing labour to be imported is reflected in the fact that over the past two years the rate of inflation has in fact moderated.

MR FRED LI (in Cantonese): Mr President, in terms of inflation and the disparity between the rich and the poor, Hong Kong fares worst among the four little dragons in Asia, particularly if one looks at the ever widening gap between the rich and the poor in Hong Kong. Whilst the importation of labour scheme is there to improve efficiency, does the Administration have other measures in hand so that the present almost double-digit inflation rate would not have an impact on the living standard of the low income people?

SECRETARY FOR ECONOMIC SERVICES: Mr President, I think I have already touched upon the measures on curbing inflation in my principal reply. I think I should at the same time point out that whilst inflation remains relatively high as compared with our neighbouring countries, nevertheless, in real terms, in most sectors real wages are rising faster than the rate of inflation.

MR MARTIN LEE: Mr President, will the Secretary inform this Council whether the Administration is satisfied with the steps taken so far to reduce inflation which, alas, still remains so high? If no, what further steps does the Administration propose to take? If yes, does it not seem that the Administration is easily satisfied with its own performance?

2090 HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 PRESIDENT: I think the first part of the question only, Secretary.

SECRETARY FOR ECONOMIC SERVICES: Mr President, I have nothing to add to my principal reply and to my answers to subsequent supplementary questions.

Euthanasia

5. DR CONRAD LAM asked (in Cantonese): Will the Government inform this Council whether an in-depth study would be carried out to see if it is proper to legalize "euthanasia" in Hong Kong; if not, what are the reasons for not doing so?

SECRETARY FOR HEALTH AND WELFARE: Mr President, the short answer is: Not for the time being. I will explain why.

Euthanasia, often called mercy killing, is a very complex and controversial subject. It has profound ethical, legal, political, religious and medical implications.

It exists in both active and passive forms.

Active euthanasia is the deliberate act of ending the life of a patient, for example by prescribing or administering a drug which accelerates the patient's death. It is usually at the request of a terminally-ill patient or his close relatives. This would constitute the crime of murder or manslaughter under existing law.

Passive euthanasia means respecting the will of the patient or his close relatives to allow the natural forces of death to follow its course, in the terminal phase of sickness, by not intervening medically to prolong life.

Although doctors in some countries may advocate euthanasia and some overseas court decisions and laws have permitted it, it is still a controversial subject internationally. The World Medical Association has declared it unethical. In Hong Kong, the Joint Ethics Committee of the Hong Kong Medical Association and the British Medical Association (Hong Kong Branch) is also of the opinion that euthanasia is unethical. Following a recent debate on the subject, the Joint Committee recommended no change in the law.

So the existing policy which is reflected in the law is that active euthanasia is illegal. Passive euthanasia, on the other hand, is also generally considered by the medical profession as unethical. Mr President, further government consideration of the matter will depend to a large extent on community views on the issue and expectations. Right now we do not see euthanasia as a subject of

HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 2091

general public concern, though we do sympathize with doctors and patients who sometimes feel forced to confront it as an option.

DR CONRAD LAM (in Cantonese): Mr President, according to the third paragraph of the Secretary's reply, "prescribing or administering a drug which accelerates a patient's death" is active euthanasia which is an offence under the law of Hong Kong. Many medical and nursing staff however have to use large doses of sedatives or tranquillizers to relieve the pain of terminally-ill patients, and they are well aware of the fact that such large doses and high frequency of administration may accelerate the patients' death. Could the Attorney General inform this Council whether this is a form of active euthanasia that develops slowly and goes undetected; if not, how the interests of these terminally-ill patients can be protected so that they will not leave this world earlier because of over enthusiasm of some medical and nursing staff?

PRESIDENT: Are you prepared to answer that question, Attorney General?

ATTORNEY GENERAL: Springing to my feet, Mr President, I would say the short answer is that the law looks to intention and not to motive.

MR SIMON IP: Mr President, is the Secretary for Health and Welfare able to tell this Council whether the authorities or the Medical Council have investigated cases of either active or passive euthanasia, and if so, with what result?

SECRETARY FOR HEALTH AND WELFARE: Mr President, the short answer is that we have not received any reported cases of active euthanasia. Whether or not there are passive cases of euthanasia has not come to our attention but I would be happy to look into this and consult the Medical Council.

DR LEONG CHE-HUNG: Mr President, in the last sentence of her reply the Secretary said: further government consideration of the matter will depend to a large extent on community views on the issue and expectations. Could the Administration inform this Council how the Government is going to seek community views and expectations? And furthermore, will the basic feelings of the health care professions be considered?

SECRETARY FOR HEALTH AND WELFARE: Mr President, we do not intend to actively, for the time being, seek the community's views on an issue such as euthanasia. As I explained earlier, I believe the community considers this as a very controversial subject with social, cultural, legal, medical and

2092 HONG KONG LEGISLATIVE COUNCIL — 24 February 1993

ethical implications. If it does become a matter of public concern, I am sure we will hear about it through both the medical profession as well as through the media.

As to the second part of Dr LEONG's question, we will be continuing to consult the medical profession about their views on this to see whether or not, like in some other countries in the world, the question of euthanasia may perhaps be debated more publicly and whether it has become a matter of genuine public concern.

DR CONRAD LAM (in Cantonese): Mr President, will the Administration inform this Council if there have been cases of over administration of sedatives or tranquillizers in hospitals here to accelerate a patient's death, and if so, how serious the problem is?

SECRETARY FOR HEALTH AND WELFARE: Mr President, I am personally not aware of such cases. But since Dr LAM has raised the question, we will look into it.

Ambulance service

6. MR TIK CHI-YUEN asked (in Cantonese): In the light of a re-organization of ambulance service under the operation of the Fire Services Department, as well as public concern over the issues such as the abuse of ambulance service, will the Government inform this Council:

(a) of the proposed deployment of ambulance service for emergency and non emergency cases, the criteria and specific arrangements involved, as well as the time-frame for introducing such arrangements;

(b) of the proposed changes to the mode of operation, and whether there are plans to improve the quality of service, such as reducing the response time for emergency calls to meet international standards;

(c) whether there are plans to set up different control centres for emergency and non emergency services, if so, what measures will be taken to avoid overlapping of responsibilities and problems of command and control; and

(d) what measures will be taken to encourage the public to make proper use of ambulance service and not to abuse the service?

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SECRETARY FOR SECURITY: Mr President, the Fire Services Department operates a fleet of 208 ambulances and 15 Ambulance Aid Motorcycles to provide both emergency and non-emergency ambulance services to the public.

Hospital Authority patients are the main users of the non-emergency ambulance service. Following discussions within the Government and between the Government and the Hospital Authority last year, a phased programme has been worked out for the Fire Services Department gradually to withdraw from the provision of non-emergency services. This will enable the Department to make better use of its resources and to focus on its primary objective as the provider of emergency services.

Under the new arrangement, non-emergency services are to be taken over by the Hospital Authority in stages, starting with Hong Kong Island on 1 October 1993, Kowloon on 1 January 1994 and finally the New Territories on 1 April 1995.

The Fire Services Department will continue to maintain its existing standard of emergency services with a fleet which will reduce eventually to 158 ambulances and 15 Ambulance Aid Motorcycles. The Department will seek to achieve, as far as possible, its target of responding to emergency calls within 10 minutes. This target response time was established in 1987, following the recommendation of an independent overseas consultant, who conducted an extensive review of the ambulance services provided in Hong Kong. There are no international standards on response times, but we are satisfied that our target time is adequate and we have no plans to reduce it. However in order to improve the quality of its emergency services, the Fire Services Department will be introducing paramedic services to upgrade the standard of on-the-spot care provided for patients in emergencies.

The Communication and Control Centre of the Fire Services Department will maintain its command and control of ambulances for emergency calls. The Hospital Authority will make separate arrangements to receive, and to respond to, non-emergency calls. The distinction between emergency and non-emergency calls is quite clear and there should be very little overlap between the two control centres. Liaison and co-ordination between the two should ensure that any problems which do arise are quickly resolved.

In the past three years, the Fire Services Department has responded to an average of about 420 000 emergency and non-emergency calls each year. There was only one proven case of abuse which occurred in 1991. We have, therefore, no reason to believe that abuse of ambulance services is a significant problem.

The main reason for this satisfactory situation is that the Fire Services Department, in consultation with the Hospital Authority, the Social Welfare Department and the Department of Health, drew up a set of "Administrative Guidelines on the Scope of Non emergency Transfers" in November 1990. Under these guidelines, the use of ambulances for non-emergency transfers

2094 HONG KONG LEGISLATIVE COUNCIL — 24 February 1993

requires pre-booking and must be authorized by a doctor, nurse or social worker. These arrangements have made the frivolous or improper use of ambulance services virtually impossible.

MR TIK CHI-YUEN (in Cantonese): Mr President, may I ask how the proposed arrangement for separating emergency and non-emergency services will bring improvement to the existing standard of services? Has the Administration considered adopting performance pledges in this regard so as to ensure that patients' rights will be protected?

SECRETARY FOR SECURITY: Mr President, the main reason for separating non emergency services is to make better and more efficient use of our resources. Non emergency services do not require the highly trained staff, the specialized vehicles and the sophisticated equipment of the Fire Services Department. The staff, vehicles and equipment are provided specifically for emergency services. The present arrangement is therefore a wasteful and inefficient use of resources and I believe new arrangements will enable the existing standard to be maintained more economically.

MR MICHAEL HO (in Cantonese): Mr President, in the second last paragraph of its reply, the Administration said: "There was only one proven case of abuse in 1991". Could the Administration inform this Council how that case was established? Does the Administration have any personnel or unit to monitor the use or abuse of ambulance services? If yes, what is the method of monitoring such that useful information can be obtained for effective monitoring?

SECRETARY FOR SECURITY: Mr President, the Fire Services Department would monitor the use or abuse of its ambulances and would have detected that case in 1991. I think it is true to say that before the implementation of the existing guidelines in 1990, the extent of abuse was probably slightly higher and that led to the need to review the system and to establish the present guidelines.

MR MICHAEL HO: Mr President, I would like to have a follow-up. (In Cantonese) It seems that, Mr President, the Secretary has not answered my question. What is the present mechanism in place in the Fire Services Department to monitor the use or abuse of services?

SECRETARY FOR SECURITY: Mr President, as I said, the Fire Services Department does, on a continuing basis, monitor the use of their ambulances. Certainly, any case in which the ambulance staff felt that the service was being abused would be reported and investigated by the department.

HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 2095

MR SIMON IP: Mr President, the 10-minute target response time could in practice end up quite a bit longer than that due to, for example, traffic congestion. Is the Government thinking perhaps of employing helicopters in emergency situations?

SECRETARY FOR SECURITY: Mr President, in recent years the Fire Services Department has responded to over 90% of emergency calls within 10 minutes, and the performance of the department in this respect has been slowly improving. It is now approximately 92% of cases that are responded to in 10 minutes. Helicopters are used in certain cases but primarily from the outlying islands. I think, perhaps, what I should say also is that in cases where traffic congestion is expected, the Fire Services Department does then tend to deploy its motorcycles which of course are able to get through traffic much more quickly. And it is these motorcycle ambulancemen who are being given priority for paramedic training so that they will be able to look after patients until a normal ambulance arrives.

MR TAM YIU-CHUNG (in Cantonese): Mr President, non-emergency services are more or less like delivery or transportation services. In that case, is it economical to use the ambulances of the Fire Services Department to provide such services?

SECRETARY FOR SECURITY: Mr President, I certainly do not think that it is economical to use the highly specialized vehicles that the Fire Services Department is now using for this purpose. And that is precisely why we have decided that we should remove this service from the Fire Services and pass it to the Hospital Authority who will be able, I think in many cases, to use a different type of vehicle, not the specialized ambulance that the Fire Services use, and therefore that they will be able to provide this service in the future, I hope, much more economically.

Written answers to questions

Highway and railway programmes

7. MR LAU CHIN-SHEK asked (in Chinese): Concerning the Recommended Highway and Railway Programmes as set out in the Second Comprehensive Transport Study Final Report which was published by the Government in May 1989, will the Administration inform this Council of the respective projects which have been completed, are currently underway as scheduled or have been deferred, as well as those which are still under consideration or on which no action will be taken; and what the reasons are for the decisions, if any, to defer or not to pursue certain projects?

2096 HONG KONG LEGISLATIVE COUNCIL — 24 February 1993

SECRETARY FOR TRANSPORT: Mr President, transport planning is a continuous process and is therefore subject to change from time to time. The Second Comprehensive Transport Study (CTS-2) published in 1989 was based on the assumption that the airport at Kai Tak would be retained. It recommended projects for implementation up to 2001. The study was updated subsequently to take account of the Port and Airport Development Strategy and latest land use plans, and its planning horizon was extended to 2011.

In 1989, CTS-2 recommended the construction, in phases, of three major new highways. These were Route 3 from Hong Kong Island to Yuen Long, Route 7 from the Island Eastern Corridor through Western District to Aberdeen, and a new route from Tsim Sha Tsui to the Kwun Tong Bypass. For the phased implementation of these routes, CTS-2 accorded priority to the Western Harbour Crossing (WHC) and the section of Route 7 connecting this tunnel to Central; the section of Route 3 from the WHC to Tsing Yi; and an extension of the future Hung Hom Bypass via a second airport tunnel under Kai Tak. The first two schemes are now planned for implementation by 1997. The need for a new route through Kai Tak is being reassessed as part of planning for South East Kowloon, as a result of the decision to relocate the airport.

CTS-2 also recommended three rail projects. These were the third cross harbour rail link, an MTR extension to Tseung Kwan O, and a Northwest New Territories/urban link. The Airport Railway will provide the third cross harbour link in addition to serving the new airport at Chek Lap Kok and Tung Chung New Town. As a result of the decision to construct the Airport Railway, all other rail development projects, including those recommended by CTS-2, have been re-examined in the Railway Development Study. The public will be consulted on the results of this study shortly.

Public housing projects

8. MR GILBERT LEUNG asked (in Chinese): Will the Government inform this Council of:

(a) the number of public housing projects on which agreements have been reached since 1988 between the Administration and the Housing Authority requiring the latter to undertake site formation work;

(b) the specific arrangements in these agreements; whether the Housing Authority has been required to bear substantial additional expenditure because of such arrangements; and

(c) the number of public housing projects for which similar arrangements are still under negotiation to date and the additional expenditure involved on the part of the Housing Authority?

HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 2097

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, land formation works for public housing sites are normally funded by the Government from the Capital Works Reserve Fund Head 707 — New Towns and Public Housing. This has not been changed by the establishment of the Housing Authority in its present form on 1 April 1988. The Government acknowledged in late 1988 that this arrangement did not cover supplementary new sites for public housing purposes in the urban areas however. Following discussions, the Government confirmed in early 1990 that it would reimburse the Housing Authority the costs of forming the supplementary public housing sites in the urban areas for which the Authority had undertaken the works.

Since this agreement was made, a total of four site formation projects have been approved in principle by the Finance Committee for funding on a reimbursement basis. Of these four projects, two are ongoing and two have yet to start. There are no other projects with similar arrangements for which submissions to the Finance Committee are being prepared.

Textbook contents

9. MR ERIC LI asked (in Chinese): Will the Government inform this Council what regulatory measures on textbook publishers are adopted by the Education Department to ensure that the contents of textbooks compiled are in line with the teaching objectives set out in the curriculum guides and are suitable for use by pupils of the specified class?

SECRETARY FOR EDUCATION AND MANPOWER: Mr President, to ensure that the contents of school textbooks are compiled in line with the teaching objectives set out in the curriculum guides and are suitable for use by pupils of the specified class, textbook publishers who wish to have their textbooks recommended for use in schools are subject to a standard review procedure carried out by the Textbooks Committee and its Textbook Reviewing Panels. Details of this procedure were given in part (b) of my written answer to Mr James TO's question on 17 February 1993.

Ocean-going carriers registered overseas

10. MR ALBERT CHAN asked (in Chinese): In the afternoon of 27 October 1992, an overseas registered container ship anchored off the Tsing Yi South Bridge listed suddenly and eight containers on board fell into the sea. Will the Government inform this Council of:

(a) the monitoring measures in force in respect of ocean-going carriers registered overseas to ensure that their construction and equipment meet the maritime safety standards of Hong Kong; and

2098 HONG KONG LEGISLATIVE COUNCIL — 24 February 1993

(b) the measure taken by the Government when accidents are caused by unauthorized alterations on board of such carriers?

SECRETARY FOR ECONOMIC SERVICES: Mr President, as a major maritime centre, Hong Kong follows closely the safety standards set out in various international maritime conventions. The Marine Department is responsible for ensuring that overseas registered ocean-going vessels visiting Hong Kong comply with these standards.

This is achieved by:

(a) ensuring that all vessels calling on Hong Kong hold valid safety certificates issued by their respective state of registry (flag state);

(b) inspecting ocean-going vessels in the manner prescribed in the various international maritime conventions (Port State Control). Particular attention is given to passenger vessels and older ships with a history of problems; and

(c) conducting specific inspections on vessels which have been reported to Marine Department as having safety problems.

If any vessel is found to be significantly deficient, or not to have valid certificates, action will be taken requiring the owner and operator to rectify these deficiencies before the vessel is allowed to leave Hong Kong.

The aim behind these measures is not simply to ensure compliance with international conventions, but to ensure the safety of ships and crews, to protect the marine environment, and to induce a greater sense of responsibility amongst owners, operators and flag states so that older, deficient tonnage is taken out of operation. Internationally, there are moves for Port State Control to target flag states whose ships have a history of being substandard, so as to rid the seas of such vessels.

Marine Department investigates every major accident occurring within the waters of Hong Kong. The flag state and the International Maritime Organization will be advised of the findings of the investigation. This will include cases in which the accident was caused by unauthorized alterations to vessels which contravene international standards, or non compliance with these standards.

Alterations to overseas registered ships are not covered in Hong Kong law. However, if the alterations materially contravene provisions covered by any relevant international maritime convention, then Marine Department can require the owners and operators to rectify the deficiencies.

HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 2099 Public Records Office

11. MRS ELSIE TU asked: In view of the Government's plan to move the Public Records Office to Tuen Mun, will the Administration advise this Council:

(a) of the reasons for and estimated cost of the relocation;

(b) whether it is aware that the relocation would inconvenience those who use the office most frequently, for example academics from the universities; and

(c) whether reconsideration can be given to leaving the office in situ, or at least relocating it near an MTR station and a public car park?

CHIEF SECRETARY: Mr President,

(a) Hong Kong's public records are currently held at five different locations in Aberdeen, Central and Tuen Mun. This is not an efficient way of using limited resources. It is therefore intended to consolidate in phases the five offices into a single operation in government owned premises in Tuen Mun. The new facilities will optimize staff deployment and efficiency, reduce recurrent leasing costs and facilitate management of the records overall. The total cost of reprovisioning all record holdings to Tuen Mun is estimated to be $30 million, including new provision for equipment, fitting out and transport.

(b) Any inconvenience caused to those using the consolidated facilities at Tuen Mun will be offset by improved records access and the modern facilities provided. The location of the new premises is not expected to affect the number of people consulting the public records in person which, during 1992, averaged five a day. Most equiries from scholars in Hong Kong and overseas are received by mail.

(c) To relocate the Public Records Office other than as proposed would frustrate the objective of utilizing government owned accommodation in a cost-sensitive and efficient manner. To purchase and fit out accommodation for the Public Records Office adjacent to an MTR station would entail expenditure of some $200 million. The facilities to be provided in Tuen Mun are situated opposite an LRT station. There are also a number of public car parks in close proximity.

2100 HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 Fire in country parks

12. MR HOWARD YOUNG asked: Will the Government inform this Council:

(a) of the total area of vegetation destroyed by hill fires in the 1992-93 fire season, and how much of this lies within the country parks; and

(b) whether the Government will consider imposing a total ban on smoking in the country parks in order to reduce fire hazard?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, the total area of vegetation affected by hill fires in the 1992-93 fire season so far is 9 401 hectares, of which 2 285 hectares lie within country parks.

The main cause of hill fires is carelessness in the handling of joss-sticks during ancestor worship, in the burning of weeds or rubbish by villagers and in barbecuing outside designated barbecue sites. Smoking is not a major cause of hill fires and there are no plans to ban smoking in country parks at present.

Chinese medicine report

13. MR TAM YIU-CHUNG asked (in Chinese): Will the Government inform this Council of the progress of the work undertaken by the Working Party on Chinese Medicine and when it will finalize its report for publication?

SECRETARY FOR HEALTH AND WELFARE: Since publication of its Interim Report last year, the Working Party on Chinese Medicine has received over 200 comments from professionals, professional and community organizations and members of the public. It has studied the views received and is now finalizing its recommendations. It is intended that the Final Report of the Working Party will be submitted to the Administration within this year.

Ten-dollar note

14. MRS PEGGY LAM asked (in Chinese): As some members of the public consider that there is merit in allowing the existing ten-dollar note to remain in circulation after 1994 or 1995, will the Government inform this Council:

(a) of the consultative process through which the decision regarding the replacement of ten-dollar notes by ten-dollar coins in 1994 or 1995 was made; and the results of consultation; and

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(b) whether it will consider requesting the note-issuing banks to continue issuing ten dollar notes after the introduction of ten-dollar coins so that both would be circulated simultaneously, thereby eliminating the misconception that these notes have been devalued?

SECRETARY FOR MONETARY AFFAIRS: Mr President,

(a) The decision to replace the ten-dollar note by a ten-dollar coin was made on economic grounds, having regard mainly to the objective of providing an efficient medium of exchange in a cost effective way. The ten-dollar note now constitutes over 60% of the total number of notes in circulation. It is so heavily used that it has a very short average life of under two years, while coins last for a much longer time. It is clearly much more economical to replace the ten-dollar note with a ten-dollar coin. There will be substantial savings on the cost of production of new bank notes and destruction of old ones.

In arriving at the decision, the two banks responsible for the issue of bank notes have been consulted. The Secretary of State, who has the authority to approve the minting of new coins, has also been consulted. The precise timing for the introduction of the ten-dollar coin has yet to be determined, along with that for the ongoing replacement of coins of existing designs by those with new designs.

(b) Because of the large number of ten-dollar notes in circulation and the constraints in production and storage of the ten-dollar coins, the ten-dollar coin will not predominantly take over the role of the ten-dollar note until after a period of at least three years. Even after that, the ten-dollar note will continue to be legal tender. There should therefore be little likelihood of any persistent misconception that the ten-dollar note has been devalued.

Community facility information

15. MR CHEUNG MAN-KWONG asked (in Chinese): Since one of the arguments put forward by some residents against the establishment of a hostel for the mentally handicapped and an activity centre for discharged mental patients within their district is that they do not have the right to know, will the Government inform this Council of the following:

(a) where local residents can have access to the latest information on future community facilities and environmental planning in their neighbourhood;

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(b) whether this information is being kept in a way that is easily understood by the general public and can be made available for their inspection;

(c) whether the District Boards and the District Offices are furnished with such information on a regular basis; if not, whether the Government will consider providing such information to these offices; and

(d) whether the Government will consider releasing any confirmed information on approval of community facilities and environmental planning matters to the District Boards and the public as soon as possible, so as to enhance the people's right to know?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, on the first question, residents have access to such information in a number of ways:

(a) land use planning including information on community facilities and environmental planning is shown on statutory outline zoning plans and non statutory development and layout plans. All these plans are available for public inspection at the Planning Information and Technical Administration Unit (PITA) of the Planning Department and gazetted or approved plans are on sale at Government Map Sale outlets;

(b) residents in public housing estates can approach their estate office for information. They are also informed of planned projects through on-site notices, regular newsletters and as far as possible the mutual aid committee meetings;

(c) prospective tenants in new public housing estates are provided with general information about the estates, including the community facilities; and

(d) works programmes and statutory town plans are also available or displayed for public inspection at Public Enquiry Counters at the District Offices.

On the second question, every effort is made to ensure that such information is readily available and easily understood. Enquiry services are provided at PITA, estate offices and District Offices.

Regarding the last two questions, District Offices are furnished with works programmes and statutory town plans on a regular basis for public information and inspection. The District Boards (DB) are briefed or consulted on the town plans, planning briefs for housing estates, departmental

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development/works programmes and major community facilities projects. The agenda and minutes of the DB meetings are displayed on DB notice boards. The public also have access to DB discussion papers and DB meetings are open to the public and the press.

Voluntary repatriation of Vietnamese migrants

16. MR MARTIN BARROW asked: Does the Government accept that an improvement in the Vietnamese economy would encourage Vietnamese migrants to volunteer to return and if so, will the Government inform this Council what specific initiatives they are taking, directly and through Her Majesty's Government, to encourage the new United States Administration to lift their trade embargo against Vietnam?

SECRETARY FOR SECURITY: Mr President, the Government does accept that an improvement in the Vietnamese economy would encourage Vietnamese migrants to volunteer to return. Our position on the American trade embargo against Vietnam is a matter of public record and is well known to the United States Government. Nevertheless, whenever the opportunity arises we and Her Majesty's Government remind them of it.

Overhanging signboards

17. MR MAN SAI-CHEONG asked (in Chinese): Will the Government inform this Council:

(a) of its policy on the control, erection and maintenance of overhanging signboards;

(b) what measures it has taken or will take to remove oversized, dangerous or abandoned overhanging signboards which pose a safety hazard to pedestrians and passengers on open decks of double-decker buses and the effectiveness of these measures; and

(c) whether it is aware of the intense neon lights emitted by some overhanging advertisement signboards at night which cause nuisance to residents on the lower floors of buildings and if so, what action it has taken or will take to tackle this problem?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, the primary concern of the Government as regards overhanging signboards is safety. The policy is to ensure that signboards which may pose a threat to public safety are removed either by the owners themselves or, if necessary, by the Buildings Ordinance Office. Under section 105 of the Public

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Health and Municipal Services Ordinance, the Director of Buildings and Lands has the power to remove or to render safe advertisement signboards which are considered dangerous or likely to become dangerous.

When dangerous or potentially dangerous signs are identified, a notice will be served on the owner requiring the sign to be removed or rendered safe. In cases of emergency, the Buildings Ordinance Office may remove dangerous signs without prior notice to the owner. As part of their daily activities in the field of building safety, staff of the Buildings Ordinance Office both seek out dangerous signs and respond to notification through public reports. These measures are adequate in removing the potential safety hazard posed by signboards. Since April 1987, when the Buildings Ordinance Office took on the tasks of dealing with dangerous signs, over 5 700 notices have been served on owners, the majority of which have been complied with voluntarily.

The Government's major concern in respect of neon light signboards is also safety. The Advertisement By-laws under the Public Health and Municipal Services Ordinance require that the Director of Fire Services be notified prior to the erection of any neon, electric or other similar light sign. The Director is also empowered to remove any sign considered to be a source of risk of fire. For similar safety-related reasons, section 9 of the Shipping and Port Control Ordinance provides that the Director of Marine may direct the removal of a light or illuminated sign if it obscures, restricts or interferes with any navigational light or might adversely affect safe navigation.

As regards the possible nuisance effect posed by neon light signboards, under the Multi-storey Buildings (Owners Incorporation) Ordinance, owners corporations may take action to enforce any obligations contained in the Deed of Mutual Covenant for the control of their building, including the removal of unsightly or undesirable signs.

The concern of Members on the safety of overhanging advertisement signs has been conveyed to the Administration previously on a number of occasions. A similar question was asked in this Council only two weeks ago; and the matter has been raised and the position explained at at least four meetings of the Lands and Works and Community and New Territories Affairs Panels of the Council in the past nine months. Members' views have been taken fully into account in reviewing and reaffirming the Administration's current policy on the subject alongside other practical considerations. The policy is effective in achieving safety commensurate with the reasonable deployment of resources having regard to other priorities, both in general terms and in the particular field of building safety. New factors have not been brought to light in recent deliberations.

HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 2105 Mobile telephones

18. DR LAM KUI-CHUN asked: In view of recent reports that holding a mobile telephone too close to a person's head may endanger his health, will the Government inform this Council whether it is aware of:

(a) the kinds of energy emitted by mobile telephones currently authorized for use in Hong Kong;

(b) the levels of the energy so emitted; and

(c) the levels of human tolerance of such energy over a period of time?

SECRETARY FOR HEALTH AND WELFARE: Mr President, mobile telephones currently authorized for use in Hong Kong emit radiofrequency radiation in the range of 800 to 900 megahertz. They have a power output of less than two watts.

Exposure limits for human beings to radiation at such frequencies are stipulated by the International Radiation Protection Association which promulgates guidelines in co operation with World Health Organization.

According to the guidelines,

"Exposure to radiofrequency radiation emitted from low power devices, such as citizen's band radio, land mobile and marine transmitters and walkie-talkies, can be excluded from consideration in assessing compliance with the prescribed limit provided the radiofrequency output power of the device is seven watts or less. Such devices generate only very localized fields."

The mobile telephones authorized for use in Hong Kong are well within this limit. They should not pose a health hazard in normal use. The user should, however, always observe the users' instructions provided by the manufacturer.

Pictures of injured or killed persons

19. MR LEE WING-TAT asked (in Chinese): In view of public concern that publication of horrifying close-up pictures of persons who were injured or killed in accidents, gunfights and so on may have an undesirable psychological effect on the readers, particularly children, will the Government inform this Council of its policy or guidelines on the publication of such pictures by the press?

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SECRETARY FOR RECREATION AND CULTURE: Mr President, the Government's policy is that the press is free to publish. The Government does not have, nor does it intend to issue, guidelines on the publication of pictures by the press.

Nonetheless, the publication of articles which consist of or contain material that is obscene or indecent (including material that is violent, depraved or repulsive) is subject to control under the Control of Obscene and Indecent Articles Ordinance (COIAO) Cap 390.

Articles considered to be indecent or obscene may be submitted to the Obscene Articles Tribunal (OAT) for classification. In determining whether an article is obscene or indecent, the OAT shall have regard to standards of morality, decency and propriety that are generally accepted by reasonable members of the community. An obscene article is disallowed from publication under the law whereas the OAT may impose conditions on the publication of an indecent article.

If a reader finds a picture in a news report offensive or repulsive, he can bring the matter to the attention of the Television and Entertainment Licensing Authority who can then seek a classification from the OAT.

The press in Hong Kong are fully aware of the provisions of the COIAO and, generally, their record in this regard is good.

Special Branch of RHKPF

20. DR PHILIP WONG asked: Will the Government inform this Council of the function of the Special Branch of the Royal Hong Kong Police Force and its achievements over the last 12 months, and whether the need still exists for the maintenance of this unit?

SECRETARY FOR SECURITY: Mr President, the Special Branch of the Royal Hong Kong Police Force undertakes functions normal to a Special Branch, including VIP protection, counter-terrorism and security duties and has carried out all of these effectively during the last 12 months. There is still a need for this unit to undertake such duties.

Oral answer to question

1994-95 electoral bill

21. MR SZETO WAH asked (in Cantonese): The Government has earlier indicated that the bills on the 1994-95 elections would be gazetted and introduced into this Council before the end of February this year. Will the

HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 2107

Administration inform this Council whether there is any change to the target; if so, of the reasons for this change?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, diplomatic contacts between the British and Chinese Governments have continued over recent weeks. We have continued to make clear that we are ready to talk at any time and without any preconditions in an effort to reach an understanding on the arrangements for the 1994-95 Elections.

We hope that formal talks between the two sides can soon begin. In order to help this process, the Governor, on the advice of the Executive Council, has deferred so far the gazetting of the Bill on the arrangements for the 1994-95 elections, other than the Boundary and Election Commission Bill. We do recognize that the current uncertain situation cannot be allowed to continue for much longer and that we will need to gazette the Bill if a decision on talks cannot be reached imminently.

MR SZETO WAH (in Cantonese): Mr President, will the Administration inform this Council how the Administration can avoid, when it comes to policy issues, repeating the incident concerning the Court of Final Appeal agreement reached by Sino-British Joint Liaison Group?

PRESIDENT: Can you put it more specifically, Mr SZETO Wah?

MR SZETO WAH (in Cantonese): Mr President, if the talks on the constitutional package should come to any agreement, how can the Administration ensure that it will be approved by this Council?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, unlike the Court of Final Appeal incident referred to by Mr SZETO, since the announcement of the Governor's constitutional proposals in this Council on 7 October, we have had the benefit of a number of motion debates in this Council in which Members' views have been fully and eloquently expressed. We have also had numerous debates within the community, some of them organized by the media. In addition, we have received written submissions from individual Members of this Council and also from members of the public which have been published in a compendium and we are indeed considering the necessity of a supplement to that particular compendium, not to mention the number of polls conducted by newspapers which have consistently shown that, despite heavy criticisms from a number of quarters, these proposals still retain a 2:1 margin of support by the community. Mr President, we will certainly in any diplomatic talks be guided by these opinion and views that have been expressed and indeed we shall remind ourselves that the Legislative Council has

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the constitutional power to enact legislation for the electoral arrangements. This we will also firmly bear in mind in any negotiations.

MR GILBERT LEUNG (in Cantonese): Mr President, will the Administration inform this Council whether the Chinese Government has insisted on some pre-conditions to be met before starting any talks with the British Government, like requiring the Governor to withdraw or abandon his political reform package before they will sit down for talks; and whether the Administration will accept such pre-conditions?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, it is clear that diplomatic exchanges will have to remain confidential. Yet I will, therefore, have to be prudent and discreet in what I have to say in answer to this question. We have said to the Chinese side that we are ready to hold talks on the 1994-95 election arrangements, without preconditions and we hope formal talks between the two sides can soon begin. I think it is neither fruitful nor helpful for any of us to try to impute into this particular exchange as to which side has given way on whatever matter.

MR FREDERICK FUNG (in Cantonese): Mr President, the Secretary has said in his reply that the Administration intends to defer the gazetting of the Bill as talks will start imminently. Does the Administration already have an idea as to the time limit beyond which the gazetting of the bill cannot be deferred any further?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, it has always been our aim to gazette the Bill as early as possible, certainly by the end of February, if we could. Were we to go beyond that date, there would have to be a very good reason for doing so. It would have to be for reasons which would be well understood by the Legislative Council and by the community.

DR YEUNG SUM (in Cantonese): Mr President, if the British and Chinese Governments will restart talks on the constitutional package, will the Administration inform this Council how Mr Chris PATTEN our Governor can ensure that the talks and the outcome will be in line with the principle of being "open, fair and acceptable to the people of Hong Kong"?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, I thank Dr YEUNG Sum for reminding us of the guiding principle for those talks. We shall certainly approach those talks, if they come about, with those principles firmly in mind. As I have said, we have had the benefit of a number of debates in this Council and the various information and views that we have gathered.

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And I think the Administration will have to make a judgement as to whether any understanding that could be reached at the end of the day will commend itself to this Council and whether it meets those guiding principles.

MR HOWARD YOUNG: Mr President, the target or deadline for gazetting the Bill in February was set by the Government itself, presumably having regard to the need to have arrangements in place for the 1994-95 elections in good time. Would the Administration advise whether it would be feasible, should introduction of the legislation be deferred, to differentiate between the 1994 elections and 1995 elections and to have some part of the legislation put in place first with the Legislative Council election part being put off to a deadline later than that for the District Boards and Municipal Councils elections, in the interest of having fruitful negotiations with China?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, it is a fact that some parts of the legislation are more urgent than others. For example, the Boundary Election Commission Bill is far more urgent because there will need to be lead time for the Commission to do its job. However, for the remaining proposals, it would be invidious to try to separate them so as to say which bit is more or less urgent, because they are all inter related. And I would submit, Mr President, that we have to be clear in our minds that the piece of legislation that will eventually emerge will be a complex one and that the Council would wish to have as much time as possible to consider it and to enact it before the end of this current Session.

MR MAN SAI-CHEONG (in Cantonese): Mr President, what will be the role played by the Executive and Legislative Councils in the Sino-British talks?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, the Executive Council will be consulted at every stage of the negotiations. We will have to, if we reach the stage of arriving at an understanding, recommend the package to this Council and this Council will then have the constitutional duty to study that piece of legislation and to decide for itself whether it should be passed.

MR CHIM PUI-CHUNG (in Cantonese): Mr President, as the community is most concerned with the issue today, my question will therefore be in greater detail, but the answer can be very brief. The political reform package announced by the Governor in his policy address on 7 October last year in fact proposed changes to nine areas. Two of them have been put into effect: one is the election of the President of the Legislative Council, in which you are elected, Mr President; the other is the separation of the Executive and Legislative Councils, which has been implemented already. As for the rest, one

2110 HONG KONG LEGISLATIVE COUNCIL — 24 February 1993

has been set aside, and that is the setting up of the Government-LegCo Committee. Another two are expected to face no great difficulties: one is the lowering of voting age from 21 to 18; the other is the single vote, single seat voting system for geographical constituencies. It is believed that these two will have the support of this Council. As regards the remaining four changes, the Governor will put them to this Council for consideration. In fact when the Governor or the Administration finds it necessary to amend the law, they can do so at any time. They can even withdraw or amend any bill that is put before this Council. My question is whether the Secretary considers the answer to the situations referred to is "yes" or "no"? If the answer is yes, that will be straightforward, but if no, what does he have to add to it?

PRESIDENT: What is the question there, Mr CHIM? (Laughter)

MR CHIM PUI-CHUNG (in Cantonese): Mr President, my question is to ask the Administration not to mislead the public because it can at any time amend the bill on political reforms that is put before this Council; would his answer be "yes" or "no"?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, I think it is a fact that in respect of any legislation that is proposed to this Council, not only Members have the right to propose amendments, but the Administration also, as I understand it, has a right to do so.

MR NGAI SHIU-KIT (in Cantonese): Mr President, the Secretary says that as there have been contacts between the British and Chinese Governments and resumption of talks is in the offing, it is necessary to defer the gazetting of the bill. He also says however that it cannot be deferred for too long and that a timetable has to be set. My question is: The Hong Kong and British Governments have time and again said that they are ready to resume talks with the Chinese side at any time and in any place; does the Administration think that pressing for a deadline for the introduction of the bill on political reforms will show a lack of sincerity on the part of the British side to reopen the talks?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, our experience with the processing of Bills, particularly complex ones, tells us that the process does take time in this Council. I would therefore submit that the timetable that we have in mind is a very reasonable one. As to the question of sincerity, it is a virtue, I would suggest, that this Government has practised time and again and we are still practising this virtue. The mere fact that we have delayed gazetting of this Bill for two weeks already fully demonstrates that sincerity. A further point I wish to add is that gazetting of the Bill, and even its

HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 2111

introduction into this Council, does not mean the end of discussions. It merely is the beginning of another process which would be lengthy.

MR ANDREW WONG: Mr President, I am not sure whether or not this is the right moment to take up a point of order. I am seeking a review of your ruling as to a previous point of order which I raised when Mr WONG Wai-yin asked his supplementary question to Question 2.

PRESIDENT: As to his making a statement, Mr Andrew WONG?

MR ANDREW WONG: Mr President, I was saying that he was making a statement and then you ruled that he should be given reasonable lead time into his question. So could I try to elaborate a bit more on my point of order, hoping that you can give me a ruling, perhaps, not at this sitting, but subsequently?

PRESIDENT: I considered that Mr WONG Wai-yin was entitled to seek to make his question intelligible by a lead-up statement and I do not propose to take it further, Mr WONG.

Motion

PUBLIC FINANCE ORDINANCE

THE SECRETARY FOR THE TREASURY moved the following motion: "That with effect from 1 April 1993:

(a) this Council approves the establishment of a special suspense account to be known as the Electrical and Mechanical Services Department Workshop Services Suspense Account ("the Account");

(b) there shall be transferred to the Account the balance of the Electrical and Mechanical Services Department Vehicle Maintenance Services Suspense Account as at 31 March 1993;

(c) the Electrical and Mechanical Services Department Vehicle Maintenance Services Suspense Account shall be closed and the resolution of the Legislative Council relating to the account made and passed on 4 March 1992 (Cap. 2 sub. leg.) shall be cancelled accordingly;

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(d) the Account shall be employed for financing the provision of workshop maintenance and ancillary services by the Electrical and Mechanical Services Department;

(e) the Account shall be administered by the Financial Secretary who may in writing delegate his power of administration to other public officers;

(f) subject to paragraph (h), the Director of Accounting Services and any public officer duly authorized in writing by him may pay from public moneys such sums as may be necessary for the provision of workshop maintenance and ancillary services by the Electrical and Mechanical and Services Department and debit the payments to the Account;

(g) the Account shall be credited with any charges paid for workshop maintenance and ancillary services provided by the Electrical and Mechanical Services Department and such other revenue as may be authorized by the Financial Secretary; and

(h) the Account shall not at any time be in debt to an amount exceeding $120,000,000 or such lesser sum as the Financial Secretary may determine from time to time."

He said: Mr President, I rise to move a resolution standing in my name on the Order Paper. Its purpose is to establish a special suspense account under section 30(1) of the Public Finance Ordinance. The proposed suspense account will cover all workshop services in the Electrical and Mechanical Services Department (EMSD) with effect from 1 April 1993. It will replace an existing suspense account covering vehicle maintenance services only.

By way of background, Honourable Members may recall that, following a resolution passed in this Council in March 1992 to establish a suspense account for vehicle maintenance in the EMSD, a charging system was introduced on 1 April 1992 for maintenance services provided by the EMSD's vehicle workshops to all government departments, the Municipal Councils, the Housing Authority and the Hospital Authority. This enabled the EMSD to run its vehicle maintenance workshops in line with commercial disciplines. A recent review of the charging system indicates that it has achieved this objective. An information note (FCRI (92-93)20) dated 5 December 1992, setting out the purpose of inter-departmental charging and analysing the performance of the Vehicle Maintenance Operating Services Account, was circulated to the Finance Committee of this Council. The Committee was informed that, given the satisfactory implementation of the Operating Services Account for vehicle maintenance workshops, the next step would be to extend this arrangement to all other workshop services in the EMSD. The resolution before Members seeks to establish a special suspense account for this purpose.

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In addition to the Vehicles Section, the EMSD operates other workshops under its Mechanical Plant Section, Electrical Air-conditioning and Refrigeration Section, and the Traffic Aids and Signals Section.

As its name suggests, the Vehicles Section is responsible for the maintenance and continuing roadworthiness of motor vehicles, as well as providing professional advice on procurement and modification of vehicles.

The Mechanical Plant Section and the Electrical Air-conditioning and Refrigeration Section are responsible for maintaining and overhauling all heavy plant and steam installations, such as filtration plants for swimming pools, boilers and other pressure vessels, water and sewage pumps, high masts and other general engineering equipment such as ventilation systems, cremators and various small appliances. Installation of temporary power supplies and 24 hour fault call services are also provided.

The Traffic Aids and Signals Section is responsible for the maintenance of traffic aids, signals and equipment installed throughout the territory. This service is provided largely to the Transport and Highways Departments.

The intention is that, when the proposed special suspense account comes into operation on 1 April 1993, the existing Vehicle Maintenance Services Suspense Account be closed and that the balance be transferred to the proposed account. All workshop expenses incurred by EMSD will then be debited to the proposed account, while the charges paid by user departments and other public bodies will be credited to it. As is the case with the present suspense account, any debit balance in the proposed account will be a charge to the General Revenue. Clause (h) of the resolution provides that the amount of such debt should not exceed $120 million at any time. This threshold is based on a careful assessment of the financial requirement of the proposed account, having regard to the expansion in its scope to cover all workshop activities.

The aim in establishing the proposed special suspense account is further to promote greater cost-consciousness amongst users of workshop services, and to extend the application of commercial disciplines to the remaining workshops of the EMSD. The account will be monitored by a committee chaired by me.

Mr President, I beg to move.

Question on the motion proposed.

MRS ELSIE TU: Mr President, I fully support the concept of making all departments aware of the cost of maintaining their vehicles, plant and equipment. It is encouraging to learn that the productive hours of the vehicle workshops' workforce have fallen by nearly 5%, and that some posts have been deleted or left vacant, indicating that the workload has decreased.

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As the representative of the Urban Council, I have checked how this system is working, and I am assured that so far it is working very well and there are no complaints.

Having said that, I would like to sound a word of caution. The document FCRI No. 20 mentions that workshop managers are required to evaluate the efficiency of their units and to be fully aware of the costs of maintaining their vehicles, as well as consciously reviewing the need for sending their vehicles for maintenance and repair.

While this sounds like good management and probably in most cases will be so, I am concerned that some managers in their over-enthusiasm to cut down costs, or their fear of being blamed for overspending, may be tempted to cut down vehicle repair to an unacceptable level. Some departments, like the Municipal Councils, use heavy vehicles which operate almost round the clock. Heavy wear and tear make them more liable to develop mechanical faults, resulting in excessive smoke affecting the environment, or even worse, faulty brakes endangering life and limb.

I just wish to draw the attention of the Government to this possibility, because it is too late to be wise after the event. I trust that all workshop managers will be encouraged to put public safety and the environment before dangerous penny-pinching on repairs.

Mr President, with this word of warning, I support the motion.

SECRETARY FOR THE TREASURY: Mr President, I am very grateful to Mrs TU for showing support for the motion. It is also very gratifying to know that the EMSD's major user client is satisfied with the services currently being provided. I would like to assure Mrs TU that the very fact that we are extending the operating services account to the EMSD's other workshops is designed to reform the financial management of the department's services and to improve the financial relationship between that department and all its user clients. This in no way diminishes the need on the part of the EMSD to continue applying safety and environmental protection standards. Let me reassure Mrs TU that, in drawing up its preventive maintenance schedules, the department pays full regard to safety and pollution control considerations and that it will continue to do so.

Question on the motion put and agreed to.

HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 2115 First Reading of Bills

MERCHANT SHIPPING (LIMITATION OF SHIPOWNERS LIABILITY) BILL FILM CENSORSHIP (AMENDMENT) BILL 1993

Bills read the First time and ordered to be set down for Second Reading pursuant to Standing Order 41(3).

Second Reading of Bills

MERCHANT SHIPPING (LIMITATION OF SHIPOWNERS LIABILITY) BILL

THE SECRETARY FOR ECONOMIC SERVICES moved the Second Reading of: "A Bill to provide for and to limit the liability of shipowners and others, and for ancillary matters."

She said: Mr President, I move that the Merchant Shipping (Limitation of Shipowners Liability) Bill be read a Second time.

The purpose of the Bill is to implement in Hong Kong domestic law, two international treaties which provide for and set limits on the liability of shipowners and others. They are:

- the Athens Convention relating to the Carriage of Passengers and their Luggage by Sea, 1974 and its Protocol 1976 (also known as the Athens Convention); and

- the Convention on Limitation of Liability for Maritime Claims, 1976.

Both of these conventions already apply to Hong Kong. They are implemented locally by United Kingdom enactments applied to Hong Kong. It is, however, necessary to enact local legislation to replace these enactments so that their legal effect will continue after 1997. This systematic localization of United Kingdom merchant shipping legislation has been underway for some years and has involved the enactment of primary and subsidiary legislation addressing such issues as marine pollution, shipping safety and the establishment of the Hong Kong shipping register.

The Bill replicates all the substantive provisions in the United Kingdom enactments, with modifications only where necessary to conform to the circumstances of Hong Kong. In essence, the Bill provides that the Athens Convention and the Convention on Limitation of Liability for Maritime Claims shall both have the force of law in Hong Kong. It also includes ancillary

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provisions relating to such matters as interpretation, the aggregation of claims, time-barring of actions, notices to be given by carriers, and the prescription of interest rates for limitation funds.

The continued application to Hong Kong of the Athens Convention, and the Convention on Limitation of Liability for Maritime Claims will ensure that disputes involving sea passengers and their luggage are dealt with in Hong Kong in accordance with international practice and that shipowners are entitled to place limits on their liability in Hong Kong, also in accordance with international practice. Since merchant shipping activities make a signficiant contribution to our economy, it is important that we continue to apply internationally recognized rules to secure the effective operation and development of our shipping industry.

Bill referred to the House Committee pursuant to Standing Order 42(3A).

FILM CENSORSHIP (AMENDMENT) BILL 1993

THE SECRETARY FOR RECREATION AND CULTURE moved the Second Reading of: "A Bill to amend the Film Censorship Ordinance."

He said: Mr President, I move the Second Reading of the Film Censorship (Amendment) Bill 1993.

When I introduced the Control of Obscene and Indecent Articles (Amendment) Bill 1991 into this Council on 4 December 1991, I pointed out then that one of the purposes of that Bill was to plug a loophole in the existing legislation by bringing films, already dealt with under the Film Censorship Ordinance, under the regulation of the Control of Obscene and Indecent Articles Ordinance when they were published as videotapes and laserdiscs. Members were, however, concerned that this might lead to double standards as the same article would be subject to classification by two different authorities. Members felt strongly that the classification of the same film for exhibition and publication whether as a cinematograph film or a videotape or laserdisc should be handled by the Film Censorship Authority under the Film Censorship Ordinance to ensure uniformity of treatment and standard.

I had taken Members' advice then and had withdrawn the relevant parts of the Control of Obscene and Indecent Articles (Amendment) Bill at the Committee stage. I had also Indecent Articles (Amendment) Bill at the Committee stage. I had also agreed to bring back to this Council proposals to amend the Film Censorship Ordinance reflecting Members' wishes in plugging the loophole. The Bill I now put before this Council serves to achieve this very purpose. The Bill also takes account of comments made by Members on the need to increase the penalty under the Film Censorship Ordinance, which has not been revised since 1988, in order to achieve the desired deterrent effect.

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Under the proposals in this Bill, all films which have been classified under the Film Censorship Ordinance when published as videotapes or laserdiscs would be subject to the same classification given by the Film Censorship Authority and Subject to the control of the same Ordinance. In addition those that were classified as Category III would not be allowed to be sold or hired to persons under the age of 18. Enforcement will be undertaken by the Television and Entertainment Licensing Authority. The admission of juveniles to Category III films exhibited in cinemas is already an offence under the Ordinance. This Bill when enacted will then prevent young persons under 18 from gaining access to videotapes and laserdiscs made from Category III films. The control of articles made purely for publication as videotapes and laserdiscs as opposed to exhibition in a cinema will, however, remain under the Control of Obscene and Indecent Articles Ordinance.

I will now highlight some of the important provisions in this Bill. Under clause 10 of the Bill, approval is deemed to be given to a film to be published as a videotape or laserdisc when a certificate of approval or a certificate of exemption is granted for its exhibition in cinemas. There is no need to seek separate approval for publication. However, when it is published as a videotape or laserdisc, it is required to display applicable classification symbols and warning notices. This requirement is also extended to any related advertising materials. Clause 11 prohibits the publication including the sale, hire or distribution of Category III videotapes and laserdiscs to persons under 18 years of age. Breach of this provision will attract a maximum fine of $200,000 and imprisonment for 12 months.

At the same time, the opportunity is taken to increase the penalties of existing offences under the Film Censorship Ordinance. This is in line with Members' views expressed previously. Clause 4 increases the maximum cash penalty for exhibiting a film without a certificate of approval or a certificate of exemption from $50,000 to $200,000, and clause 11 increases the penalty for exhibiting a Category III film to juveniles from $10,000 to $50,000 on the first or second conviction. The penalty for the third and subsequent convictions remains unchanged at $100,000. Hopefully, these new levels of fines will have a stronger deterrent effect.

In order to allow the industry adequate time to comply with the requirements of these provisions, clause 1 of the Bill provides for delayed commencement. Our intention is that these provisions will take effect six months after the enactment of the Bill. This will also allow time for films previously submitted under the revoked Film Censorship Regulations to be resubmitted for classification under the new arrangements.

Mr President, I feel that the provisions in this Bill strike a balance between the need to allow adults the freedom to access a wider choice of films published as videotapes and laserdiscs, and the need to protect young persons below the age of 18 from being exposed to the undesirable influence and impact of unsuitable, videotapes and laserdiscs. I hope, too, that this Bill will meet with

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Members' approval as it fully reflects the views and sentiments of Members previously expressed in this Council.

Mr President, I beg to move.

Bill referred to the House Committee pursuant to Standing Order 42(3A).

PROTECTION OF WAGES ON INSOLVENCY (AMENDMENT) BILL 1993 Resumption of debate on Second Reading which was moved on 3 February 1993 Question on Second Reading proposed.

MR TAM YIU-CHUNG (in Cantonese): Mr President, employees affected by insolvency of their employers have long been denied reasonable compensation as a result of the low maximum limit for payments from the Protection of Wages on Insolvency Fund.

As far back as the end of 1991, I questioned the Government on the maximum limit for payments from the Protection of Wages on Insolvency Fund. I pointed out at the time that in 1990-91, 33% of the claims for wages in arrears were over the maximum limit of $8,000 and that 51% or rather 53% of the claims for wages in lieu of notice were over the ceiling of $2,000. In the light of this, it is therefore evident that a considerable number of affected employees were not given reasonable compensation to which they were entitled. These two maximum limits should have been adjusted long ago.

This Bill proposes to raise the maximum limit for payment of wages in arrears from $8,000 to $18,000 (an increase of 225%), and the limit for wages in lieu of notice from $2,000 to $6,000 (an increase of 300%). The old limit was set in accordance with wage levels in 1977 when the prevalent median wage then was $2,000. The maximum limit for payment of wages in arrears was therefore set at four times the then prevalent median wage. The prevalent median wage is $6,000 now, three times that of 1977. However, the maximum limit for payment of wages in arrears is not raised by a corresponding 300%. In other words, the principle of setting the limit at four times the prevalent median wage has been altered.

The Protection of Wages on Insolvency Fund was set up to protect employees affected by compulsory winding-up, rather than those affected by voluntary winding-up. Compensation for employees affected by voluntary winding-up of companies is calculated according to severance pay provisions under the Companies (Winding-up) Rules of the Companies Ordinance. Generally speaking, voluntary winding-up can be converted into compulsory winding-up by way of certain legal procedure so that employees affected by

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voluntary winding-up may be compensated in time with payments from the Protection of Wages on Insolvency Fund instead of waiting until after the complicated and usually time consuming winding-up processes of the companies in question are completed. However, there have been some problems with this conversion procedure in actual practice. First is the complexity of the procedure. Generally speaking, affected employees are unaware of this procedure. And even if they are aware of it, they do not know how to proceed. Therefore, I hope that the Administration will conduct a study on simplifying this procedure, so that more people can understand this procedure. Secondly, the court would more often than not dismiss applications for conversion from voluntary to compulsory winding-up, given the great number of people involved in voluntary winding-up of some relatively small companies. As a result, the affected employees are only entitled to compensation provided for under the Companies Ordinance. However, the Companies Ordinance provisions in respect of compensation on insolvency have not been amended to synchronize with amendments to the Protection of Wages on Insolvency Ordinance. Under the Companies Ordinance, preferential payments are set at $8,000 for wages in arrears, $2,000 for wages in lieu of notice and $8,000 for severance pay. Is this fair to those affected employees who can only get compensation from voluntary winding-up? I hope the amount of compensation on insolvency provided for under the Companies Ordinance could be amended to draw level with that provided for the Protection of Wages on Insolvency Ordinance. I also hope that the procedure for converting voluntary winding-up to compulsory winding-up can be simplified, so that all employees affected by the insolvency of their employer companies may be given compensatory payments in time. While to advance money from the Fund to pay to affected employees on behalf of insolvent companies subject to compulsory winding-up is a measure of protection for employees, I am worried that employers might use the Fund as a convenient means to shirk their responsibility of paying compensation to employees upon insolvency. Here I hope that the Companies Registry and the other relevant departments will take effective measures to prevent employers from abusing the Fund. I also hope that the Government will raise to reasonable levels as early as possible the maximum limits for payments of wages in arrears and severance pay.

With these remarks, Mr President, I support the motion.

MR LAU CHIN-SHEK (in Cantonese): Mr President, although I welcome the Administration's amendments to the Protection of Wages on Insolvency Ordinance, I have to point out a number of deficiencies in regard to the amendments.

First, on principle. The labour legislation only lays down the lowest protection standard. The lawful rights of the employee should in no way be done away with or curtailed simply because the employer is winding up his business. Therefore, the Protection of Wages on Insolvency Fund should in principle guarantee in full the statutory minimum of wage protection to which

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the employee is entitled in case of insolvency. That is why I say that the amendments today do not go far enough. What is especially disappointing is amendments today do not go far enough. What is especially disappointing is that the amendments have not increased the payment ceiling in respect of severance pay and that the raising of the payment limit in respect of wages in arrears to $18,000 is also inconsistent with the situation now prevailing in Hong Kong. Since the maximum protection available in respect of wages in arrears is four months' pay, if we take $6,000 as the median wage, the maximum protected amount should at least be $24,000, which is four times $6,000. I therefore urge the Administration to increase as soon as possible the protected amount in respect of wages in arrears to $24,000. Furthermore, the payment ceiling in respect of severance pay should change from the current $8,000 plus half of any amount in excess of the $8,000 to $24,000 plus half of any amount in excess of the $24,000. Up until March 1992, the Fund has an accumulated surplus of some $300 million and so there is definitely sufficient financial means to back further amendments.

In addition, I would like to point out a problem, with the hope that the Administration will make remedy to it as soon as possible. Currently, after making payment by way of advance to the employee, the Fund may on his behalf seek to recover the amount from the insolvent company under the Companies Ordinance. However, according to the provision governing preferred debts in the Companies Ordinance, the amount recoverable for wages in arrears is $8,000, that for wages in lieu of notice is $2,000 and the maximum recoverable for severance pay is $8,000. The fact that these amounts are different from those payable from the Insolvency Fund under the Protection of Wages on Insolvency Ordinance means that the Fund cannot fully recover the money advanced, which hinder the steady growth of balances in the Fund. Moreover, this provision on preferred debts in the Companies Ordinance has not been amended for 15 years and clearly cannot keep abreast with the developments of Hong Kong. I therefore propose that whenever the amounts of payments from the Insolvency Fund are revised, the recoverable amounts of the preferred debts under the Companies Ordinance should be correspondingly amended to ensure a healthy financial development of the Fund.

I would also like to remind the Administration of the need to guard against the malpractice of defrauding the Fund and the employees under the guise of insolvency. Some insolvent employers would claim that they were unable to pay the wages in arrears and encourage their employees to apply to the Insolvency Fund, and shortly afterwards, they would start operating again in the name of a new company. Such practice is a blatant act of cheating the employees of their hard-earned money and the Fund of its payments. I urge the Administration to review the relevant legislation and the commercial investigation procedure in order to prevent such frauds from happening.

Mr President, with these remarks, I support the amendment.

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SECRETARY FOR EDUCATION AND MANPOWER: Mr President, I am grateful to Honourable Members for their support for the Bill.

The Bill seeks to raise the maximum limit on the amount of ex gratia payment payable by the Protection of Wages on Insolvency Fund in respect of arrears of wages and wages in lieu of notice. This improvement will enable the Fund to provide better protection to employees whose employers have become insolvent.

Mr TAM Yiu-chung and Mr LAU Chin-shek have suggested that the maximum ex gratia payment in respect of wages in arrears is insufficient. The suggestion was in fact considered in detail during the consultation leading up to the introduction of the Bill. We have concluded that for the moment, it would be appropriate to raise the payment limit from $8,000 to $18,000. The new level of $18,000 represents, on average, more than two months' wages for most of our blue collar and white collar workers. Under normal circumstances, one would not expect workers to tolerate non-payment of wages for more than a month or two. Setting the level at $18,000 should provide adequate protection for the majority of the workforce; our operational experience indicates that this level of coverage would meet the full entitlement of over 95% of applicants in respect of wages in arrears. Those who do not get their full entitlement are mainly the better paid employees. Having said that, we shall continue to review the maximum limit from time to time to ensure that it remains appropriate.

There has also been a proposal to revise the payment ceiling in respect of severance payment. Since the last increase was only made in June 1991, it would be more appropriate to review the matter later in the year when the impact of the last increase on the financial position of the Protection of Wages on Insolvency Fund could be more clearly assessed. It is the Fund's practice to review its coverage regularly and to introduce gradual improvements, taking into account its financial position and the implications of such improvements for the rate of levy.

On the question of whether or not voluntary liquidation should be covered by the Fund, I can assure Members that the matter has been carefully considered. We are not in favour of further extending the coverage to this area in view of the possibility of abuse and the significant financial impact. In any case, under the existing law, employees involved in voluntary winding-up cases can obtain payment from the Fund provided that they proceed with the presentation of winding-up petitions against their employers. In those voluntary liquidations where there are less than 20 employees and where it is considered by the Commissioner for Labour unreasonable or uneconomic to present a petition for winding-up, payments from the Fund may be made to employees under section 18 of the Protection of Wages on Insolvency Ordinance. In 1992, section 18 was invoked in 56 cases involving payment of more than $600,000 to 101 employees.

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We are aware that passage of the Bill would result in a wider gap between the preferential limits of payment under the Companies Ordinance and the Bankruptcy Ordinance and the maximum payment levels under the Fund. This discrepancy would result in the Fund suffering greater financial loss as it would not be able to have all its payments treated as preferential debts upon realization of the employer's assets. Currently, the Labour Department and the Official Receiver's Office are looking into the matter. If any proposal is identified to narrow or remove the gap, the Protection of Wages on Insolvency Fund Board and the Labour Advisory Board will be consulted.

Question on the Second Reading of the Bill put and agreed to.

Bill read the Second time.

Bill committed to a Committee of the whole Council pursuant to Standing Order 43(1).

HOUSING (AMENDMENT) BILL 1992

Resumption of debate on Second Reading which was moved on 9 December 1992 Question on the Second Reading of the Bill proposed, put and agreed to. Bill read the Second time.

Bill committed to a Committee of the whole Council pursuant to Standing Order 43(1).

Committee stage of Bills

Council went into Committee.

PROTECTION OF WAGES ON INSOLVENCY (AMENDMENT) BILL 1993 Clauses 1 to 4 were agreed to.

HOUSING (AMENDMENT) BILL 1992

Clauses 1 and 3 to 16 were agreed to.

HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 2123 Clauses 2 and 17

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr Chairman, I move that clauses 2 and 17 be amended as set out in the paper circulated to Members.

The amendment to clause 2 is to clarify that section 4(2)(eb) of the Ordinance applies to land over which the Housing Authority has control and management, as well as to land owned by the Authority.

The amendment to clause 17 is to validate all acts done before now which relied on the purported exercise of powers under section 4(2)(ia), 4(2A), 7A and 16(2) or 25D of the principal Ordinance as amended by this Bill. Every act done prior to the commencement of this Bill in relation to the provision of financial assistance to eligible households, management contracts, the hearing of appeals, subletting arrangements by operators of commercial premises and the delegation of authority in respect of car parking and vehicle control will thus be validated, provided the act is authorized under the Ordinance as it is proposed it should be amended.

Thank you, Mr Chairman.

Proposed amendments

Clause 2

That clause 2 be amended, by adding before paragraph (a) —

"(aa) in subsection (2)(eb), by repealing "it" and substituting "or under the control and management of the Authority";".

Clause 17

That clause 17 be amended, by deleting subclause (1) and substituting —

"(1) Every act or thing done by the Authority prior to the commencement of this Ordinance that would have been authorized and lawfully done if section 4(2)(ia) or (2A), 7A, 16(2) or 25D of the principal Ordinance (as amended or added by sections 2, 4, 5 and 10 of this Ordinance respectively) had been in force at the time, is hereby validated and declared to have been authorized and lawfully done; and no person shall be liable, whether in civil or criminal proceedings, for any act done pursuant to an authorization purportedly given by the Authority and for which act the person would not have been so liable if those

2124 HONG KONG LEGISLATIVE COUNCIL — 24 February 1993 sections had been in force at the time the authorization was purportedly given.". Question on the amendments proposed, put and agreed to.

Question on clauses 2 and 17, as amended, proposed, put and agreed to. Council then resumed.

Third Reading of Bills

THE ATTORNEY GENERAL reported that the

PROTECTION OF WAGES ON INSOLVENCY (AMENDMENT) BILL 1993 had passed through Committee without amendment and the

HOUSING (AMENDMENT) BILL 1992

had passed through Committee with amendments. He moved the Third Reading of the Bills. Question on the Third Reading of the Bills proposed, put and agreed to. Bills read the Third time and passed.

Members' motions

PRESIDENT: I have accepted the recommendations of the House Committee as to time limits on speeches and Members were informed by circular yesterday. The mover of the motion will have 15 minutes for his speech including his reply and other Members will have seven minutes. Under Standing Order 27A, I am required to direct any Member speaking in excess of the specified time to discontinue his speech.

TAXI POLICY REVIEW

MRS MIRIAM LAU moved the following motion:

"That this Council urges the Administration to fully consider the views expressed by the public and those in the trade on the "Consultative Paper on Taxi Policy Review" and ensure that our taxi policy is effective in

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promoting quality taxi service and maintaining taxi fares at reasonable levels in Hong Kong."

MRS MIRIAM LAU (in Cantonese): Mr President, in May last year, I moved a debate on taxi service in this Council and urged the Government to conduct a full review of its taxi policy. On that occasion, many Members offered their comments on how to improve taxi service. My purpose in moving the debate today is to give them a chance to respond to the Consultative Paper on Taxi Policy Review published by the Transport Advisory Committee (TAC) in October last year.

Ostensibly, TAC claims that this is a taxi policy review, but, in fact, its recommendations touch only on three matters: the taxi licensing system, the taxi fare policy and the quality of taxi service. Indeed, these three matters are related directly or indirectly to the problems of recent years: the speculation on taxi licences and the declining quality of taxi service. While TAC's recommendations do deal with these problems, the scope of the review itself is not broad enough. Taxi policy, in fact, has other aspects. For instance, what role should taxis play among all public transport services? What is the relationship between urban taxis and New Territories taxis? And should they be merged? These aspects, too, need to be reviewed quickly, since our objective is to improve taxi service within the framework of the overall development of public transport services.

In view of the time constraint, I will confine myself to a brief analysis of, and a response to, the recommendations contained in the consultative paper.

Licensing System

When TAC began its taxi policy review last year, many people drew attention to the fact that taxi licence premium had risen out of sight, the result of the Government's restriction on licence issuance as well as the absence of restrictions on the licence's validity period and transferability. The consultative paper's six recommendations concerning licensing are all directed against real flaws in the licensing system, specifically against licence speculation with a view to stabilizing the licence premium at reasonable and healthy levels. In fact, after TAC began its review, the public's expressed concern about the implications of the licensing system and their proposals for a flexible system have already had an immediate impact on various problems caused by the high taxi licence premium. As a result, the urban taxi licence premium has now fallen to between $1.6 million and $1.63 million after peaking at $1.8 million in the middle of last year, while the New Territories taxi licence premium eased to $9,200,000 from $1.05 million. This goes to show that the peak premium reached was inflated by speculation and did not mirror the true value of the licence. The consultative paper's recommendation against a pre-set quota on taxi licence should be effective in curbing licence speculation and stabilizing the level of the taxi licence premium.

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The consultative paper recommends limiting each taxi licence tenderer to one application and requiring each tender bid to be accompanied by supporting financial documents. I think that this recommendation, which is intended to prevent syndicates from cornering the taxi licence market, may not be effective or practical. There are two reasons. Firstly, syndicates will be able to continue monopolistic practices by submitting multiple tender bids through dummy companies or front-men. Secondly, how can individuals submitting tender bids come up with the required supporting financial proofs? At present, a prospective taxi-owner has to seek the assistance of a taxi company to get a mortgage from a bank (it is also known as "joining the company" in the trade) because taxi company could provide the necessary collateral. By themselves, individuals who wish to submit tender bids simply cannot find banks that are willing to make such loan commitments.

As for the introduction of new types of taxi licences with certain validity period or other restrictions, I think that issuing a suitable number of such licences will be effective for keeping supply in line with demand in the taxi licence market and thus for stabilizing the taxi licence premium and the taxi rental charge. However, two questions need to be further studied. Firstly, will finance companies be willing to provide loans to finance the purchase of such non-transferable licences with various restrictions? Secondly, when the holder of the new-type licence wants or has to stop operating, what will happen to his licence? Admittedly, as the consultative paper notes, the Commissioner for Transport may waive the transferability restriction under certain circumstances. Still, what if the remaining validity period of the licence is too short to interest prospective transferees? In that case, will the Government buy back the licence and, if so, what will the terms be? The consultative paper is completely silent on these tough questions. I think that, if the proposed licences are to be issued, we must first of all stop letting taxi companies control the banking facilities for individual taxi owners. I think that the financing problem can be solved, and taxi drivers with limited resources can have their own taxis if the Government allows them to pay by instalments for the taxi licences as recommended in Paragraph 3.4.15 of the consultative paper.

Finally, I agree that all taxi licence transactions should be legally executed. Consideration may also be given to the imposition of stamp duty to increase the cost of transactions. This will institutionalize the licence transfer procedure and curb licence speculation.

Taxi Fare Policy and Structure

I think that the present fare differential of five times between the urban taxi and other modes of public transport is already reasonable enough. The consultative paper says that, if need be, consideration will be given to raising the flag fall charge to discourage passengers for short trips. In fact, taxis have become a form of transport used by the public. They are a necessity and not a luxury. Many commuters need the fast and direct service provided by taxis. Many people take taxis to connect to other modes of public transport so that

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they do not have to drive their own cars and add to the traffic congestion. To encourage such taxi use, I do not think that short-trip passengers should be singled out. Besides, the consultative paper notes that short-trip passengers account for only 25% of all taxi users. There is no evidence of unwarranted taxi use by short-trip passengers. Nor is there evidence to indicate that such short-trips cause traffic congestion or deprive other commuters of their chances to take a taxi. Therefore, I am opposed to raising the flag fall charge.

Concerning the baggage surcharge, there is so far no clear guideline on what constitutes the term "baggage" in respect of which the surcharge is payable. This is a common cause of unnecessary disputes between taxi drivers and passengers. The Government should lay down clear instructions concerning the baggage surcharge. Also, taxi operators should be required to have the surcharge instructions posted conspicuously in every taxi for passengers' reference.

I think that a careful approach should be taken to any adjustment of the waiting time charge. In theory, raising the waiting time charge is to compensate taxi drivers for the time that they lose while stuck in the middle of heavy traffic. However, a passenger, in consideration of the high waiting time charge that he will have to pay, may decide to get out of the taxi in the middle of heavy traffic, leaving the driver, who cannot stop the passenger from doing so, trapped in the heavy traffic all by himself. On balance, a higher waiting time charge will not necessarily benefit the driver.

Quality of Taxi Service

The quality of taxi service is what concerns the public the most. It is something that they encounter daily. Often, during hours when commuters have the greatest need for taxi service, taxi drivers refuse hire or keep the flags covered and pick passengers. This is really too much. Yet we often hear complaints about such happenings. Many Members of this Council, myself included, have had such unpleasant experience. Some drivers overcharge their passengers. This hurts not only the pocket of the affected passengers but also the reputation of Hong Kong as an international city. There were 2 683 complaints against taxis in 1992, an increase of 1 013 over 1991. Complaints about taxis refusing hire increased by 78 instances or by 16.5%. Complaints about overcharging went up by 713 instances or by 157%. Complaints against rude drivers increased by 153 instances or by 43%. Not all the complaints have been investigated conclusively, so the number of complaints merely provides an indication. Still, the increase in the number of complaints is enough to make people worry. Also, there has been a marked increase in the number of prosecutions mounted against taxi drivers for malpractices. In 1992, there were 426 fixed penalty tickets served on taxi drivers for malpractices, a 126% increase over the number for 1991. The number of taxi drivers served court summonses or arrested and charged increased from 678 in 1991 to 869 in 1992. The number of cases involving passenger solicitation increased from 15 to 57. The number of refusing hire cases went up from 231 to 261. The

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number of cases involving overcharging increased from 30 to 45. The number of cases involving rude conduct increased from 52 to 80. These were alarming rates of increases. Under current law, the maximum penalty for each of the above offences is a fine of between $3,000 and $5,000 plus six months imprisonment. Yet the courts have been meting out punishment averaging a mere fine of between $300 and $500. The punishment actually meted out for overcharging is a mere fine of about $700. Rarely has any driver been sentenced to a prison term. How can such light penalties be an effective deterrent? The consultative paper refers to a revival of the idea to introduce a demerits system. In principle, I agree that such a demerits system can be an effective deterrent on unscrupulous drivers. Still, we should consider the situations and feelings of the majority of the taxi drivers, who are law-abiding. Offenders are only a small minority. In many complaints against taxi drivers, evidence from third parties present at the scene was not available. Also, taxi drivers are already subject to a driving offence points system in the way of their driving skills. To subject law-abiding taxi drivers to an additional points system for conduct will probably be very unfair. Besides, taxi drivers have already been taking active steps to improve the quality of their service. One example is the training class for new taxi drivers. While it is not yet known how effective these steps will be in practice, what is clear is that taxi drivers are sincere in maintaining self-discipline. They should be given a chance. For its part, the Government should give them encouragement and support. Therefore, I feel that, at this stage, the Government should shelve for the time being its feasibility study of the points system. However, it is undeniable that the present penalties for offences in relation to taxi service are too light. While the maximum penalty can be a fine of several thousand dollars, the fine actually imposed is only several hundred dollars. Therefore, the fines meted out by the court should at least be doubled to reflect the seriousness of the offences and to show the community's unhappiness with them. To deal with the more serious offences, such as overcharging and taximeter-tampering, the Government may wish to consider suspending the driving licences of first-time offenders and revoking the driving licences of habitual offenders so that a deterrent effect can be achieved.

As for the recommended re-testing of taxi drivers, I feel that it may not be effective for raising the quality of taxi service. In addition, given that other professional drivers do not have to be re-tested from time to time, it seems to be unfair to re-test taxi drivers alone. A better way is to set a higher standard for the taxi driver's qualifying test. This means requiring those taking the test not only to be familiar with the streets and places but also to have an in-depth understanding of what constitutes proper conduct for taxi drivers. Furthermore, the Taxi Operators Association should organize some training classes to give refresher courses to in-service taxi drivers and should draw up a code of conduct for the trade. This will help to raise the professionalism of taxi drivers.

Concerning the recommendation for making it compulsory for taxi drivers to take physical examinations, I agree in principle that all professional

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drivers who are 60 or above should undergo physical examinations for the safety of the drivers themselves as well as for the safety of other road users. However, the Government should make clear what kinds of physical problems make a person unfit to drive. Thus, drivers will understand the scope and the purpose of the physical examinations.

I agree with all the other recommendations contained in the consultative paper, such as simplifying the complaint procedures, relaxing the restrictions on where taxis may stop to pick up and let off passengers, conducting public information campaigns and so forth. I urge the authorities to give these recommendations serious consideration and implement them expeditiously.

Mr President, taxi service is so important to the public that the interests of the public should naturally come first in the taxi policy review. On the other hand, the interests of those in the trade should not be overlooked either. Both the providers and the users of taxi service have a right to expect a policy that is fair, just, reasonable and acceptable to them. Taxi service, as well as its quality, can be improved only through an even-handed approach to the interests of consumers, taxi owners and taxi drivers, on the basis of an overall consideration of the needs of the entire community.

Mr President, with these remarks, I beg to move.

Question on the motion proposed.

MR HUI YIN-FAT (in Cantonese): Mr President, in its public transport policy, the Government has never given adequate consideration to the more than 500 000 motion impeded persons such as the handicapped and the aged. It has been totally indifferent to their predicaments. Worse still, the Government leaves it to franchised public transport companies to decide for themselves whether or not safety facilities should be installed for the benefit of this kind of passengers. These franchised operators, generally myopic, would care only about a good rate of return on investment. This would certainly deprive the handicapped and the aged of their right to use public transport services. This is a reality that I cannot accept. And it is on the basis of "equal participation" that the handicapped take a critical view of this consultative paper.

Among the various modes of public transport in Hong Kong, only a few can offer convenient services to the motion-impeded persons and taxi is one of them. But taxi cannot really satisfy the needs of them, both in terms of their facilities and service. I have personally seen many taxi drivers refuse hire to handicapped persons, particularly those in wheel-chairs, who had been waiting by the roadside for a long time. It is not that these taxi drivers felt no sympathy for them. It is that their taxis are not equipped to help the handicapped to get in and get out. Stopping and taking time to pick up or let off a handicapped person may disrupt the flow of traffic.

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As we all know, handicapped or aged persons try to go out as little as possible. When they do have to go out, even if they will not mind paying the higher taxi fare, they cannot obtain taxi service as easily as the non-handicapped. Furthermore, the Rehabus service is available only along a few routes due to a lack of resources. There are simply not enough of them to meet the huge demand. However, the Government, which often talks about the building up of a caring-government image has allowed nearly 10% of the population of Hong Kong to continue being subject to unfair treatment. This is really a disgrace to a civilized society.

Mr President, of course, action and co-operation are needed from all quarters if the handicapped and the aged's transportation problem is to be fully solved. But the first and foremost thing is that the Government must honestly and practically find out what their needs are. In fact, during many previous debates in this Council, I urged the Government to do what other countries had done, that is, to enact legislation or to add franchise stipulations to safeguard the rights of the elderly and the handicapped with regard to the use of public transport services. I believe that, if the Government had given serious consideration to my suggestions, the situation would have been much better than it is now.

With regard to the present consultative paper, it is of course unrealistic to expect that any improvements made by taxi operators could solve the above problems fully. However, there is something that the Government can really do to induce taxi operators to play a more positive role. For instance, I think that, to deal with taxi drivers' mental block that makes them refuse hire to passengers in wheel-chairs, legislation may be enacted to require all taxis, before a certain deadline date, say, within 10 years, to install special equipment to make boarding and alighting easier for passengers in wheel-chairs. The cost of all the required vehicle modifications and equipment installations should be shared by the Government and taxi owners. In addition, the Government may wish to consider licensing a suitable number of taxis for the handicapped. Such taxis, when not being used by handicapped passengers, should be allowed to operate in the streets like the other taxis. Thus, their operators will be able to earn a reasonable level of income.

Mr President, the handicapped's demands are modest enough. Their principle is simply "equal opportunity and full participation" vis-a-vis the rest of the population. In line with such a principle, they want the Government to protect their rights with regard to the use of public transport services which are enjoyed by the able-bodied persons. Their demand is completely fair and reasonable. I sincerely hope that, during the limited remaining years in the latter half of the transition period, the Government will give substantive help to the handicapped and thus be able to project the image of a caring and responsible government. The people of Hong Kong will thus be left with a good impression by something that is done before the transfer of sovereignty.

With these remarks, I support the motion.

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MRS PEGGY LAM (in Cantonese): Mr President, I will comment today on two issues: the taxi licensing system and the quality of taxi service.

As we all know, the taxi licence premium has risen sharply in recent years and the buying and selling of taxi licences has practically been reduced to a pure form of speculation. To corner the market, holders of taxi licences submit unreasonably high bids every time new licences are open to bidding. This has the effect of raising, in turn, the value of the licences that they are already holding. As a result, it is even more difficult for taxi drivers to become taxi owners and passengers have to pay higher fare due to the higher premium of the taxi licences. The system not only yields staggering profits for the monopolists but also impairs the interests of taxi drivers and consumers. This situation must be rectified at once to check the unreasonable rise in taxi licence premium.

I support a taxi ownership scheme under which taxi licences would be made available to taxi drivers for their application at reasonable prices. The Government may also consider collecting a security deposit for each licence issued, which will be refunded when the licence is returned for cancellation and from which any traffic offence fines for the licence holder may be deducted. The validation period of such new-type taxi licences could be five years and they could be renewable for five years at a time. Each taxi driver is to hold no more than one taxi licence and the licence is to be non-transferable. Renting or giving the licensed taxi to another person to drive is not to be permitted. When the owner-driver gets old and retires, or when he changes his line of business for any reason, he is to be required to return the licence to the Transport Department. When he, for health or any other reason, loses his ability to drive, the Transport Department is to refund an appropriate portion of the licence premium. To ensure that the above conditions are adhered to, the driver is to show that he is the owner of the taxi by displaying prominently his identification in the taxi, such as by posting a recent photograph of himself. The licence plates of such taxis are to be of a distinctive colour or the taxis are to be identifiable by special external marks. When an owner is found to have transferred his licence or leased his taxi to other operators, the Transport Department could revoke the licence immediately and confiscate the security deposit. I have asked many taxi drivers for their comments on such a scheme. They are all in favour of it. When the licence premium is affordable to the average taxi driver, speculation on taxi licences will naturally cease.

Secondly, the licence quota system should be abolished and replaced with a flexible approach. One cause of the sharp rise in the taxi licence premium is the imbalance between supply and demand. When demand exceeds supply, those wishing to operate taxis have to pay a high premium for the licences. When considering the abolition of the quota system, I studied the three factors referred to by the Transport Advisory Committee: consumer demand, the viability of the trade and the impact on road traffic conditions. I feel that taxi drivers will naturally not apply for licences if there is no consumer demand or if the taxi trade is not viable. Therefore, there would not be a problem of oversupply of licences.

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The licences that have already been issued may remain freely transferable. When the two proposed measures above are adopted, the premium for the previously issued licences will come under control. The wild speculation in taxi licences will gradually cease and taxi licences can then be traded under fair and healthy conditions. Of course, speculators will perhaps burn their fingers because of this. But the Government's main consideration should be the interests of the general public and not those of the speculators.

Another issue is the quality of taxi service. This issue has been discussed for many years but no significant improvement has been made. Related statistics have it that there were more complaints in 1991 than in 1990 and the figure went up further in 1992. I believe that a small number of black sheep have brought the taxi trade into disrepute.

Not long ago, somebody complained to me about a new way of overcharging. After a passenger (in most cases an elderly person or a foreigner) has boarded the taxi, the driver will start his taximeter and then ask the passenger, "I am responding to radio call from Mrs CHAN, who offered to pay $10 extra. Are you Mrs CHAN?" The passenger will then have two choices. She may pay the flagfall charge and get out immediately or she may pay the extra that is demanded. This is very unfair to the passenger. Foreign passengers, who are not familiar with Hong Kong, have thus to pay extra fare that is higher than the radio-call service surcharge. This really hurts Hong Kong's image.

Refusing hire remains a widespread phenomenon. Some taxi drivers refuse hire to cross-harbour passengers. Some refuse hire to passengers wishing to go to a destination in congested areas. Some taxi drivers display a sign on the dashboard saying that they will only go to Kowloon. However, if a passenger makes a gesture indicating that he will pay $10 or $20 extra, they will then not insist on going to Kowloon. Actually, when fare rates were set, all such factors as the need to make short trips, to go into congested areas or to make cross-harbour trips had already been taken into consideration. Using them as justifications for refusing hire is unacceptable.

There is a suggestion to introduce a demerits system to improve taxi service. It, too, is unfair. The Transport Department in fact is already using a traffic offence points system that applies to all drivers including taxi drivers. Subjecting taxi drivers to an extra points system will be very stressful and unfair to them. I have asked many taxi drivers for their comments. They all respond that fines may be stiffened for traffic offences and this will not impair the interests of the majority of the taxi drivers, since offenders are only a small minority.

Another kind of complaint is about excessive surcharges. The Transport Department's guidelines on the baggage surcharge and the radio-call service surcharge are not clearly defined. A table of surcharges should be posted

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conspicuously inside each taxi. This will help to reduce disputes between taxi driver and passenger in this respect.

As for raising the flagfall charge, we have to take into account the fact that Hong Kong is a small place and if the the flagfall charge is revised by increasing the minimum-distance for a trip, some passengers requiring short trip will be forced to stop using taxi service. This is contrary to the principle of offering taxi service as a form of public transport.

Lastly, I would like to suggest that the Transport Department conduct an extensive publicity campaign and print pamphlets that spell out the rights of passengers. Thus, members of the public will know how to deal with taxi drivers who violate the regulations. This will help to avert unnecessary arguments.

Mr President, with these remarks, I support the motion.

MR MARTIN BARROW: Mr President, when I spoke in this Chamber last year I pointed out that the quality and reputation of our taxi service is not simply a matter concerning Hong Kong residents but is also of considerable importance to the tourism industry. The impression of Hong Kong that visitors take away with them is vital if they are to recommend Hong Kong as a place to visit and the service they receive from taxi drivers is crucial in forming this impression. This influence is even more significant now given the fact that the number of visitors using taxis has further increased in 1992. Surveys show that 66% of our seven million visitors use taxis, up from 61% the previous year. We can therefore infer that perhaps 4.6 million people enjoyed, or not, at least one ride in a taxi.

The Hong Kong Tourist Association is therefore pleased that various measures have been put forward for consideration and we are submitting our comments to the Secretary of the Transport Advisory Committee. We support in general most of the points under fare policy and structure and quality of taxi service. I would however like to highlight now a few of our main concerns.

We do not agree with the idea of a flag fall charge to regulate the demand for short trips. It is neither fair nor reasonable. Any lack of taxis is a result of many causes, for example, traffic jams, rush hours, accidents and so on. Users of taxis for such short trips, such as visitors, should not be penalized. It would also complicate the fare structure.

We strongly suggest that the term "baggage" be defined clearly because this can affect visitors even more than local residents.

In addition, for the reassurance of both residents and visitors, we strongly suggest that every taxi driver be required to display identification with name and driving licence number in both the front and back seats.

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Also, receipts should be issued, if requested. This would also help in any disputes concerning such malpractices as overcharging, not taking the most direct route and failing to reach a destination.

Regarding another malpractice, we believe that the misuse of the "out of service" sign gives visitors, in particular, a bad impression. This system should be punished severely.

We also believe that the system of surcharges should be kept simple to avoid the confusion of both visitors and residents.

In relation to the standard of English spoken by taxi drivers, it may be useful if some system could be devised whereby the drivers' proficiency in speaking English would be displayed on the windscreen.

All our comments consider the effect that our taxi operations have on visitors and ultimately therefore on the tourism industry, the third largest earner of foreign exchange. At this time when we are competing with other travel destinations around the region it is imperative that our taxi drivers provide an even more efficient and courteous service for our visitors. Our role as the most popular travel destination in Asia could be in jeopardy if they do not. Thank you.

MR MOSES CHENG: Mr President, I rise today to join our honourable colleague, Mrs Miriam LAU, in her continuing efforts to push for an equitable policy to govern the licensing system of the territory's taxis and consequently improve the quality of taxi service to Hong Kong citizens and international visitors. I believe we should be just as committed to support a maximum of free market principle on this issue as we are on others, but the reality of this particular market, and its impact on the public good, beckon us to re-examine, and perhaps ultimately redefine, the rules which govern it. While supporting the fundamental policy of public tendering for licences, measures must be enacted to curb the speculative trends that have dominated this practice and driven licence premia exponentially upward.

In doing so, the objective shall not be to fix or regulate prices, but instead to offer stability to a spiralling market and once again offer incentives for entrepreneurs to own their taxis.

Some may question the correlation between the dramatic rise of speculation for licence premia and the quality of service, but the statistics supporting this claim are clear in unmasking the perils of continuing on the same path.

From 1984 through 1990, the average tender of an urban taxis premium rose gradually, in a healthy range of approximately 10%-20% or slightly ahead of the inflation rate. But in the last two and a half years alone the rate has

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skyrocketed to more than 100%, and has locked in a secondary market for financing new taxi licences, which are obviously beyond the reach of any ordinary, hard-working drivers. The total increases for the last nine years has been over 100% and continues on a pace far faster than either inflation or the earnings of taxi drivers.

In the period that corresponds with speculative tendering and sharp rises in premia since 1990 both prosecutions and complaints received by the Transport Complaints Unit have risen disproportionately. Between 1990 and 1991, before the Government's crackdown on taximeter offences, one can see a dramatic rise of nearly 60% in prosecutions echoing the increase in premia. Whether this is an aberration or a natural reaction, it seems to be consistent with the rise of other offences and public complaints during the last three years. For example, through only November of last year, complaints over "refusing hire" rose 15%, "failure to take the most direct route" complaints rose 22%, "misconduct and poor driving manner" 44%, and most troublesome of all, an astounding 164% rise in complaints of "overcharging fares" over this short time span.

The negative aspects of this link, between speculative tendering and quality of service, are clear, and clearly INTOLERABLE!

Mr President, the consultative paper appears to be more a collection of ideas and proposals, rather than a succinct plan. It is pertinent to pull forth the ideas of greatest value. I will concentrate my thoughts here on reformation of the licensing system. With few exceptions, I am largely in support of the current fare structure, and I contend that curbing speculative practices may be the most substantial way to improve the quality of service.

By repealing the pre-set quota and flexibly issuing licences, the Government can begin to erode the certainty that has assisted rampant speculation. With the date and the number of licences confirmed long in advance under current market conditions, tenderings can be dominated by a limited amount of very wealthy speculators, who in most cases are not taxi drivers. In a recent tendering, three-quarters of all licences were successfully bid by a single car company, who had undoubtedly calculated their capital gain well in advance. While the proposal will not hinder the current market forces involved in the tendering, it should hopefully slow them down by limiting forecasts of conditions at the time of tender.

The other recommendation that I would like to focus on involves restoring ownership of taxis to the taxi drivers. It is important that the assets of this industry be not beyond the reach of the people who operate them.

If the industry becomes more affordable, more independent drivers can get licences and be truly in business for themselves. By empowering drivers to master their own destiny within the market, an adjusted policy might encourage

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owners to offer their services competitively while decreasing the recent strains caused by financing.

The Transport Advisory Committee implicitly, and occasionally explicitly, acknowledges the value of making the taxi industry affordable to taxi drivers throughout their recommendations, but there is still a need to further develop and adopt plans that have workable impacts. For example, TAC rightly points out the possibility of large companies using multiple "front-men" to make tender bids, if each tenderer is allowed only one application. This is actually more of a "probability" than a "possibility", but the difficult alternatives remain unexplored. Like the recommendations concerning financial proofs, validity periods, and transferability, much is needed through both continued probing and analysis of such innovations and a government response on feasibility. So long as these proposed adjustments do not undermine the fairness and fundamentals that are the original intent of the system, minimize regulatory excesses, and retain market characteristics, they may be worthy of pursuing.

On the question of instalments, for example, we should examine the success or failures of our own experiences to afford adequate analyses. All Hong Kong commercial and residential Crown lands sold before 1 October 1979 and all industrial Crown lands sold before 1 January 1981 could be paid by instalments. So there is a precedent with comparable and larger scale financing, but there are also lessons learned that can shed light on the feasibility of such recommendations. What must be determined now is what will be the role of the Government in helping resolve the problems TAC has outlined and achieve the objectives we all agree on. Whether they are to enter the arena as a counter balancing player or a forceful referee, I hope this resolution serves as a catalyst to get off the bench, and help the taxi industry regain its reputation for providing a high degree of service, safety, and convenience.

With these remarks, I support the motion.

MR TAM YIU-CHUNG (in Cantonese): Mr President, it is the wish of the general public that the quality of taxi service could be promoted while taxi fares be maintained at reasonable levels. However, the public's complaints about taxi service have increased with each year. In May last year, this Council held a debate on taxi policy. In October, the working group of the Transport Advisory Committee (TAC) formed to review taxi policy drew up a consultative paper on taxi policy review, which made several recommendations to improve the taxi policy. However, I have been told by friends in the taxi business that many of the recommendations fail to get to the heart of the problems and that some of them may even hurt the interests of taxi drivers and indeed consumers in general.

In fact, the biggest problem with Hong Kong's taxi policy is the taxi licensing policy. The Government treats taxi licences as merchandise and sells them to competitive bidders. This enables some taxi owners to gain

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monopolistic control by holding a majority of the issued taxi licences. Speculators then buy and sell the licences, making them more costly to taxi drivers. Worse still, taxi drivers are not covered by any welfare or retirement protection schemes. Some of them therefore are driven to such unlawful practices as picking passengers, overcharging and refusing hire. Consumers as a result cannot obtain satisfactory taxi service. I quite agree with the Motor Transport Workers General Union's suggestion to substitute a rental system for the tender system for taxi licences. Under the rental system, the Government is to provide taxi licences on a rental basis to taxi drivers selected through lotteries or draws. This will be effective for curbing speculation and monopoly. Regrettably, the consultative paper did not include this suggestion among its recommendations. Its consideration was confined to how to perfect the tender system. It is doubtful that the recommended methods will be really effective for correcting the flaws of the tender system. For instance, one recommendation is restricting each tenderer to one application, as if this would prevent the syndicates from cornering the market. Yet, if a syndicate may use a large number of non-drivers to tender for a large number of taxi licences, the result will similarly be a monopoly. Besides, as long as taxi licences are issued on the basis of bidding, they often can be bought and sold speculatively and the problem will never be solved. The consultative paper's recommendations not only fail to get to the heart of the problems but may even hurt the interests of taxi drivers and consumers. For instance, one recommendation is raising the flag fall charge to discourage short-trip passengers. Yet, according to a recent survey by the Motor Transport Workers General Union, about 40% of all taxi passengers, in the day as well as at night, are short-trip passengers travelling for under three kilometres. Evidently, short-trip passengers are major users of taxi service. If the flag fall charge is raised to discourage short-trip passengers, the earning of taxi drivers will certainly be affected. Also, according to the same survey, many consumers have to rely on taxis for short trips. Now that the other public transport services are still unable to satisfy consumers' short-distance travel needs, taxis remain a popular mode of public transport. Raising the flag fall charge will only add to consumers' burden and will not be the answer for the problem. Rather it will make taxi fare even more unreasonable.

In addition, the consultative paper recommends the use of a demerits system for punishing misbehaving taxi drivers. Under such a system, points will be counted against a taxi driver convicted of an offence and, upon full count, his driving licence will be suspended. In my opinion, the existing regulations for taxi drivers already prescribe penalties that are stringent enough and a flawed demerits system will be very stressful to many taxi drivers. I believe that, though complaints about taxi service have increased, unscrupulous taxi drivers only form a minority. There are now more than 14 600 taxis in Hong Kong. They operate on a two-shift basis. A driver makes about 60 trips a shift. Thus, the quarterly total amounts to about 78 million taxi trips. And there were 663 complaints about taxi service during the first quarter of 1992 according to the Government. This is equal to 0.85 complaint per 100 000 taxi trips. To stiffen penalties just because such a small number of taxi drivers break the law will put all taxi drivers under great psychological pressure.

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Besides, some taxi drivers' union representatives told me recently that taxi drivers' offences were sometimes due to language barriers and communication problems between driver and passenger or unclear traffic signs. To count points against taxi drivers for such offences to the point of suspending their driving licences will be unfair.

Also, the consultative paper accepts the Transport Department's suggestion to require all professional drivers including taxi drivers to take physical examinations and renewal of licences for taxi drivers who are 50 or older will depend on whether they pass the physical examination. A questionnaire survey conducted by the Motor Transport Workers General Union in August last year among more than 1 000 professional drivers (including more than 900 taxi drivers) found that the majority of the taxi drivers within the 50 to 60 age group had excellent safe driving records and that most of them worried that the physical examination system would threaten their job security. One must bear in mind that taxi drivers do not have any kind of retirement protection and, given that the taxi licence premium is so high, they are earning just enough to make ends meet. If a taxi driver in his 50s cannot renew his driving licence because of his failure in passing the physical examination, his livelihood would be in jeopardy. I honestly hope that the Government will reconsider such a proposed policy.

Lastly, the consultative paper recommends that licensed taxi drivers be given a new test every three or five years. In my opinion, this is neither reasonable nor necessary. All licensed taxi drivers have already taken and passed stringent tests arranged by the Government. To give them a new test every three or five years will undoubtedly burden them with unnecessary pressure and be wasteful of government resources. Therefore, I am against this recommendation.

In sum, it is a positive move for TAC's working group to prepare a consultative paper as a basis for public consultation on taxi policy. But I feel that the working group, after gathering the comments of all sections of the community, has apparently failed to get to the heart of the problems. Some of its recommendations are indeed disappointing.

Mr President, with these remarks, I support the motion.

REV FUNG CHI-WOOD (in Cantonese): Mr President, complaints about taxi service have been rising sharply. It is indeed time to carry out a full review of taxi policy. One taxi operator's association has suggested that fare receipts could be issued to passengers, showing such information as trip distance, fare, waiting time and taxi licence number. This is a very good suggestion. It will help to reduce misunderstanding between driver and passenger. Furthermore, when there is a complaint, the receipt can provide objective evidence, which will make it difficult for either party to stick to his own story.

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Another thing is that the Government so far has not precisely defined the term "taxi baggage". It is often a point of dispute between passenger and driver over the size of a baggage for which the passenger is required to pay a surcharge. The Government should act expeditiously to lay down a precise definition for taxi baggage.

With regard to the relaxation of operation restriction to allow taxis to pick up and discharge passengers in restricted zones, it should be handled cautiously because public light buses, too, may make similar request. If green light is given to this proposal, I am afraid, roads will become congested and there will be too many stands for taxis and public light buses. On the other hand, I think it is something worth trying if we lift some restrictions and allow taxis to pick up and discharge handicapped and elderly passengers at certain places in restricted zones.

I would like to respond to the three recommendations on taxi fare. Mr LEE Wing-tat will be discussing the overall taxi fare policy.

Firstly, raising the flag fall charge to discourage demand for short-trip service is not a fair recommendation. People need short-trip service mostly in areas where feeder public transport is lacking, or in emergencies, or because of physical handicaps. It is never a matter of unwarranted or improper demand for such service. Short-trip passengers should not be penalized. Any attempt to discourage demand for short-trip service by raising flag fall charge is undoubtedly just a cover for raising fare. And fewer short-trip passengers are not necessarily good for the taxi business.

Secondly, I am against increasing the waiting time charge to discourage passengers wishing to go to destinations in congested areas. The very existence of the waiting time charge is meant to compensate taxi drivers for the time that they lose in heavy traffic. Therefore, it is misleading to say that the waiting time charge should be increased because traffic jams affect taxi drivers' income. Often, traffic jams are beyond the expectation of passengers. Nor, unless it is absolutely necessary, do passengers in general take a taxi to go into a usually congested area. We therefore have a strong reason for doubting the rationale and effectiveness of such a recommendation. Also, judging from the rising number of vehicles on the roads and from road traffic conditions, traffic jam is not a problem affecting just one or two areas. Passengers going anywhere by any route will very probably pass through a congested area. This being the case, I think the only point of increasing the waiting time charge is to get the passengers to pay more. There is no other valid point.

Thirdly, the fare structure should be as simple as possible. This will minimize any possible arguments between driver and passenger. If there is a surcharge for additional members in the passenger's group, a surcharge for service during the peak hours or a surcharge for service during the New Year holiday and other holidays, passengers not understanding the complex fare arrangements can easily be made to pay excessive fare. Even if taxi drivers

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collect only the lawful surcharges, disputes may arise between them and passengers who do not understand the fare arrangements. Therefore, I am against altering the present fare structure.

With these remarks, I support the motion.

MR FREDERICK FUNG (in Cantonese): Mr President, I would like to comment on the licensing issue in this motion debate. Hong Kong is a highly commercialized international city. The pace of life is fast. Taxis naturally have become an essential form of transport in the everyday life of the people. Where taxi service is concerned, people's major expectations are threefold: (1) reasonable fare levels; (2) quality service and (3) adequate taxis service. To the taxi drivers, the most important thing is reasonable remuneration. The Government's taxi policy should be formulated on the basis of these principles.

However, the present licensing system has some loopholes which hurt the interests of the people and taxi drivers alike. The biggest flaw of the present licensing system is that it invites licence speculation and monopoly. Heretofore, it has been possible for the syndicates to successfully bid more than three quarters of all the licenses issued during each tender at the expense of the genuine taxi operators. The market for the newly issued taxi licences during each tender is controlled solely by a few syndicates. The premium paid for a taxi licence rose sharply from $160,000 in July 1984 to $1.5 million towards the end of 1991. Taxi drivers who have bought the expensive licences have found it very difficult or even impossible to meet the mortgage payments. It is this burden that causes some taxi drivers to refuse hire and to pick passengers and commit other malpractices. The quality of taxi service has declined as a result. Licence premium persistly maintained at high levels is also a cause of high taxi rental charges and inflates taxi fares as a result. Passengers are the ultimate victim. Nor are the drivers receiving reasonable remuneration.

To improve the situation, the Government should reform the present licensing system and take all possible steps against monopoly and speculation. One feasible step is to introduce a different system of licence tendering. Under this system, bids are to be invited at irregular intervals and there is to be no pre-set limit on the number of licences to be issued. And each tenderer could only submit one application. In this way, the chances of market cornering by syndicates will be minimized. However, when this licensing system is introduced, careful consideration must be given to the public's demand for taxi service, taxi drivers' business conditions and the impact on road traffic. Also, the policy branch must, after the completion of each round of tender, provide the public with an explanation justifying the number of licence issuances and the timing of the tender, and be responsive to the comments of civic groups concerning taxi service's supply and demand.

Another recommendation of the consultative paper on taxi policy review is that tender applications be supported by financial papers. The Association for

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Democracy and People's Livelihood and I think that this recommendation, if adopted, will not stop syndicated tenderers. It will only make things more difficult for individual tenderers. This is because the banks at present will not provide documentary evidence of financial arrangements to people who have not yet been a successful bidder. On the other hand, the Government should introduce a taxi ownership scheme by arranging loans for the successful bidders and allow them to repay the loans by instalments so as to encourage taxi drivers to buy their own taxis.

In addition to the taxi licences currently in use, the Government may in fact wish to consider issuing new-type licences which are non-transferable and, which, if necessary, can only be sold back to the Government. The new-type licences should have fixed validity period. Upon expiry, they can be renewed, with the priority accorded to taxi drivers. The Association for Democracy and People's Livelihood suggests that such licences be valid for six years. According to my calculation, the premium for this kind of licence ought not be in excess of $700,000. I believe that the new-type licences will have a moderating effect on the premium for the old-type licences. However, no matter what step to be taken, the Government should consider slightly increasing the number of licence issuances to bring supply in line with demand in the over-heated market.

Monopoly is very rampant in the taxi business. I believe that it will be very difficult to resolve the problem in a short time. Still, the Government should take steps to improve the above-mentioned situation, thus safeguarding the interests of consumers and taxi drivers.

With these remarks, I support the motion.

MR LEE WING-TAT (in Cantonese): Mr President, last year, this Council already urged the Government to act expeditiously to solve the problem of taxi licence speculation and the problems concerning taxi service. Meanwhile, for a time, the premium for a taxi licence went up to as high as $1.8 million. The Transport Complaints Unit received a total of over 2 600 taxi service complaints in 1992, an increase by more than 1 000 complaints over 1991. Evidently, no progress has been made in solving the problems in relation to taxi licence premium and taxi service complaints. This is disappointing indeed. The Government must act swiftly to bring about the various improvements.

It is generally considered that the flawed licensing system is mainly responsible for the soaring taxi licence premium in recent years. A taxi driver, given his normal income, cannot afford the monthly mortgage payments if he wants to become a one-taxi owner. As for the drivers of leased taxis, they, too, are carrying a heavy burden because rental charges have risen sharply with the taxi licence premium. In order to earn more, they resort to such malpractices as overcharging, picking passenger and taximeter-tampering. Furthermore, this system also greatly increases pressure for higher taxi fares.

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The purpose of taxi licensing is to enable those who are interested in operating taxis as a business to obtain the operating right in fair competition. However, the Government has been practising a licensing system in which a limited number of new taxi licences are granted by tender at any one time. As a result of this, most of the newly issued licences fall into the hands of big taxi companies. And speculation in the licences on the market has sent up taxi premium several times the original investment. This is a departure from the original object of taxi licensing. Any actions taken by the Government to rectify the situation certainly will not constitute interference with the operation of the free market. It will be an action for restoring the original health and fairness of the marketplace.

The first step for regularizing the licensing system is to get rid of the practice in which a limited number of new taxi licences are sold by tender at any one time. The number of new taxi licences to be issued should depend on the changes in the demand for taxi service, the road traffic conditions and the number of potential taxi users. Where it is not known in advance how many new taxi licences will be issued or when they will be put on the market, it would be more difficult for the big syndicates of taxi companies to corner the new taxi licence market. The number of new taxi licences should be set at a level compatible with the actual demand. And this will be good for the community in general.

With regard to the tender procedures, we support the recommendation that each tenderer be limited to one application so as to prevent the big taxi companies from getting too many licences. But I have reservations about the recommendation that bid submissions be accompanied by financial proofs. It is easier for a big taxi company than an individual taxi driver to arrange bank financing. So the requirement for financial proofs will not be very effective against market cornering and speculation. I think that a more effective method is to require each tenderer to produce evidence to show that he is a qualified taxi driver and does not have a taxi licence. This requirement will make it more costly for a taxi company to submit a tender bid if it is to do so through a front-man.

Apart from the pre-set quota of taxi licence, another contributory factor of the speculation is that licences can be transferred easily for gain. In this connection, to prevent newly issued taxi licences from being obtained by speculators and to safeguard the interests of the genuine taxi operators, the Government may specify a period of time during which newly issued licences may not be transferred. This will naturally moderate the premium for the newly issued licences. Yet it will have no major adverse effects on the genuine taxi operators or on the holders of previously issued licences. In fact, because this arrangement will greatly discourage taxi companies from engaging in licence speculation, it will be good for the genuine taxi operators. We suggest that, to begin with, it should be stipulated that newly issued taxi licences may not be transferred during the first year. If this turns out to be ineffective for discouraging the speculation in new taxi licences, then the Government may

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wish to consider lengthening the non-transferability period to 18 months, two years and so forth.

Mr President, many people have talked about a taxi ownership scheme, which involves the issuance of a new type of non-transferable taxi licence that has a limited validity period. The advantage of the scheme is that it will make taxi licence speculation difficult and make the licences less expensive. It will obviate the need for a taxi driver to pay too high a premium for a taxi licence or too high a taxi rental charge. I feel that the suggestion is worth further exploration. The Government can use the new-type licences to bring supply and demand into balance in the taxi licence market. If and when supply exceeds demand, the Government can repossess the licences as their validity expires.

One of the important elements of the taxi policy is the taxi fare policy review, which has a direct bearing on the public. To begin with, the position of the United Democrats of Hong Kong (UDHK) with regard to taxi fare consists of two major points. The first major point is that, if and when taxi fare is adjusted, the public should be given an explanation justifying the adjustment by the way of the publication of actual operating cost figures on the part of the taxi operators. Also, fare adjustments should be made on the basis of the public demand of taxi service and they should be acceptable to the public. The rising taxi licence premium is not a justification for raising taxi fare. It is not a convincing argument if the fares of other modes of public transport are drawn as reference to justify any taxi fare increases on the grounds of widening the fare differential between taxis and other modes of public transport. We believe that the fare differential is wide enough as it is. We do not see many members of the public preferring taxis to MTR or the bus. Nor has the number of taxi users increased significantly. Frequent taxi users are handicapped persons and people living in areas with poor feeder public transport service. These people will bear the brunt of a sharp taxi fare increase and of the many surcharges, if introduced. This will be really unfair to them.

Our second major point is that there should not be a complex fare structure. A complex fare structure is bound to give rise to more unnecessary disputes over fare between taxi drivers and passengers and provide some unscrupulous taxi drivers with more opportunities to rip taxi users off. Therefore, we are opposed to the surcharge for additional heads in the passenger group, the surcharge for going into congested areas, the surcharge for after midnight service and the surcharge for holiday service. Such surcharges will be confusing to the passengers and will lead to arguments over fare. I hope that the authorities concerned will seriously consider these points raised by the UDHK before approving any taxi fare increases.

Mr President, with these remarks, I support the motion.

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MR MAN SAI-CHEONG (in Cantonese): Mr President, statistics show that the public filed more than 2 700 complaints against taxi drivers in 1992. Most of the complaints were about overcharging, failure to take the most direct route and refusing hire. These problems should be blamed on the taxi licence premium which has been sustained at high level. And this situation has induced some taxi drivers to risk breaking the law. To increase earning to meet high taxi rental charges or high mortgage payments on taxis, they resort to such unlawful actions as refusing hire, charging a premium for bad weather and on holidays, overcharging and even tampering with the taximeter. Taxi is an important mode of transport in Hong Kong. In view of the year-to-year increases in the number of complaints about taxi service, I think that the authorities must introduce a more effective mechanism for handling complaints and simplify the complaint procedures.

I support the Transport Advisory Committee's recommendations on how to improve taxi service and prevent malpractices on the part of tax drivers. Overcharging and failure to take the most direct route account for most by far of the complaints about taxi service. I think that some new measures may be introduced to prevent unscrupulous taxi drivers from overcharging and ripping passengers off, such as installing tampering-proof taximeters, requiring taxi drivers to produce and show their driving licences and giving passengers the right to demand fare receipts. Then, in the event of a fare dispute between a taxi driver and his passenger, the passenger will be able to file a complaint with the authorities, which, in turn, will be able to serve court summonses on the offending driver and prosecute him successfully on sufficient evidence because the passenger knows the driver's identity and has the fare receipt. I am very much in favour of amending existing law to increase the penalties for offences such as overcharging and taximeter tampering. The penalties should include higher fines and the revocation of the driving licence in the case of drivers who are habitual offenders. This will rid the taxi business of a minority of black sheep and safeguard the good name of the entire taxi trade. Therefore, I think that there is a need to deter misbehaving drivers by imposing tougher penalties.

I favour simplifying the complaint procedures to make it easier for passengers to file complaints against offending taxi drivers. For instance, complaint forms could be placed in the airport, hotels, district offices, banks and other public places for use by members of the public. In addition, the authorities must help members of the public and those in the trade to understand what their rights and obligations are. This will improve relations between taxi drivers and passengers and minimize their mutual misunderstandings. Lastly, I hope that taxi drivers will set up their own trade body to promote quality service, exercise internal supervision and enhance the spirit of self-discipline. This will improve taxi service and help to cut down the number of consumer complaints about taxi service.

I am therefore in favour of the implementation of the recommendations of the Consultative Paper on Taxi Policy Review concerning how the mechanism for handling complaints about taxi service could be made more

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effective and how the complaint procedures could be simplified to safeguard the consumer rights of taxi passengers.

MR STEVEN POON (in Cantonese): Mr President, for many years, like a taxi, taxi policy has been turning in circles and never managed to get out of the blind alley. Today, with this consultative paper in our hands, we are once again asking the Government to formulate a comprehensive taxi policy to promote quality service and maintain taxi fare at reasonable levels.

I think that the taxi licensing system is the biggest problem of the taxi trade. And this system must be revised if quality service is to be secured and reasonable fare level to be maintained. The reason is: when the taxi licence premium is sustained at a high level, the taxi rental charge would be subsequently pushed up, eroding the net income of taxi drivers. This indirectly affects the quality of service.

Everybody says that the taxi licence speculation in recent years has run wild. The premium for a taxi licence has gone up to as high as $1.8 million or a double of the 1990 figure. This rate of increase is really staggering. As the taxi licence premium keeps rising, the public will never be able to enjoy quality taxi service. Therefore, we should consider issuing some restricted taxi licences as a way of solving the problems stemmed from taxi licence speculation.

Last year, I made two proposals concerning taxi licensing. I will reiterate my views today. My first proposal is to issue a kind of licence — I call it licence B — that can be held only by a working taxi driver. Licence B is issued through tender to a taxi driver. It cannot be transferred; nor can a licensed taxi be leased to another party. It can be transferred to another working taxi driver only upon the death of the original holder of the licence. This proposal is intended to enable those who drive taxis for a living to become taxi-licence holders so that they can fulfil their wish of being owner-driver.

My second proposal is to issue a kind of taxi licence — I call it licence C — which has a restricted period of validity, say 10 years. When the validity expires, the licence is automatically revoked. Such licences are again obtainable by tender. The difference is that they can be transferred while they remain valid.

As to the present unrestricted taxi licence — I call it licence A — I think we should continue to issue it.

After reading the consultative paper on taxi policy review, I still think that my proposals are suitable and feasible. My purpose in putting them forth is to curb taxi licence speculation, subject, however, to the principle that the interests of the existing licence holders will not be harmed. And the existing licence-holders will not sustain monetary losses because of the new licensing system. My two proposals have their own merits and both kinds of taxi licences

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can be made available in the market at the same time. It is not necessary for the Government to choose any one of them. In other words, the Government can issue the three kinds of taxi licences together and bidders can make their own choice. The premiums for all three kinds of licences will be determined by the market. The consultative paper says that, if licence B cannot be transferred, it would pose difficultly to those taxi operators who really want to get out of the business. Yet, I do not think that this will be a problem. Actually, when a taxi operator decides to tender for a licence B, he will already have taken this kind of factors into account. His bid will then reflect the restrictive nature of licence B. As for licence C, which is valid for only a certain number of years, they must be revoked when their validity expires. If a holder of such a licence still wants to drive a taxi for a living, he can tender again.

I do not agree with the consultative paper where it says that licence C should be renewable under certain circumstances. If such licences are selectively or conditionally renewable, a variety of problems may easily arise. One question is what criteria or principles should be used for determining renewability. Another question is how to set the renewal premium. These are difficult questions to answer. I agree, however, that an operator who has failed to provide satisfactory service should be disqualified from tendering again and that an operator who has proved to be providing good service should be treated preferentially when he tenders again.

The consultative paper argues that, if licence C of finite validity cannot be renewed, licence-holders will probably try to maximize return at the expense of the quality of service during the validity of their licences. I think that this worry is unjustified. In fact, people always try to make more money no matter what the circumstances are. However, if an operator provides good service during the validity of his licence, he will stand a better chance of successfully bidding for the licence in the next round of tender. So I believe that taxi operators will not casually sacrifice the quality of their service. I suggest that the Government refrain from announcing in advance how many licences of each type, A, B or C, will be sold by tender each year. The number of licences actually issued should be based on the bids submitted and the public's demand for taxi service and should be announced only after the bids have been opened.

With these remarks, I support the motion.

MR HOWARD YOUNG (in Cantonese): Mr President, in 1990, the Government put a restriction on taxi licence issuance, limiting annual number of licences to be issued to 400. Since then, the taxi licence premium has been in a continuous upward trend and has even hit the mark of $1.8 million. Speculative frenzy is one cause of the endless rise of the taxi licence premium. The restriction on issuance has turned taxi licence into a low-risk, high profit investment vehicle. I think that the most effective way for curbing the speculation and for

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stabilizing the premium for licences is to abolish the pre-set quota on taxi licence issuances and to respond flexibly to the market demand for taxi licences.

The Government now sets the quota on annual taxi licence issuance at 400 licences. This gives speculators an opportunity to invest safely and yet profitably. However, if the Government cares to take the step to repeal the quota system, it can practically undermine the mechanism of the present speculation. If we believe in the free market, we should relax the restriction on supply and let the market forces and profit margin find the optimum level for the number of taxis on the streets. Those working taxi drivers who really want to buy their own taxi licences can then submit tender bids to the Government instead of having to buy the licences from speculators. This would effectively bring an end to the speculative activities. Taking the argument one step further, the Government may also issue taxi licences at irregular intervals. If the market cannot base predictions of supply shortages on a known quota on issuances, licence hoarding will be less profitable. Speculators will have to take the risk in terms of the time factor and the supply of the licences, thereby raising the cost but reducing the rate of return on investment. All this will deter speculators.

Another effective way to stop taxi licence speculation is to restrict the transferability and validity period of the licences. Under existing policy, there is no limit on the transferability of taxi licences. This creates an extremely favourable environment for investors and emboldens speculators to buy and sell taxi licences for profit brazenly. Restricting the transferability of taxi licences will greatly reduce the speculators' freedom of action. This would have an effect like turning the licences into flats under the Home Ownership Scheme where there is no speculation at all. It will be difficult for speculators to realize their profits quickly whether they are thinking of leaving the market or of reinvesting. Taxi licence speculation will then be less attractive.

Some people say that a restriction on the validity period of taxi licences will pose a threat to genuine taxi operators' job security. I think that a sound licence renewal system can be helpful to working taxi drivers who are also holders of the restricted taxi licences. For instance, when the holder of a taxi licence that is about to expire applies for renewal, the authorities can use the opportunity to review his particulars. Licence renewal should depend on whether the applicant is a genuine working taxi driver. The authorities may ask to see his annual income tax returns and other documentary evidence to determine his profession. In the long run, this will stabilize the taxi licence premium and be more beneficial to genuine drivers.

What I have been trying to put forward is mainly some positive measures to curb taxi licence speculation. Furthermore, it will have the effect of helping drivers to obtain their own taxi licences. Given that a taxi driver makes not only a living but also a profit, the Government should not subsidize him as it does the buyers of Home Ownership Scheme flats. Among the remaining feasible options, the most flexible one seems to be the provision of assistance by way of mortgage and payment terms. For instance, they may be allowed a

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higher mortgage lending ceiling and a longer term of payment by instalment. These would help to achieve the goal of the taxi ownership scheme and yet not violate the principle of giving no subsidy to taxi drivers. Of course, it is the finance companies which handle taxi licence mortgages. However, it is the Government which may allow the high premium for licences to be paid for by instalment.

With regard to the recommendation to limit each taxi licence tenderer to one application, I feel that it will be administratively difficult to implement. Firstly, if taxi licences remain freely transferable, a company circumvents this rule by using different front-men to tender for licences and then buy the awarded licences from them or it can set up a number of companies each of which will tender for one licence. As for the Government, it will have to set up a body to monitor the operation, to screen the applicants and to take action against offenders. Without such a body or adequate monitoring, the effectiveness of the restriction will be doubtful. This recommendation is not one as good as the others discussed above, namely, introduction of non-transferable licences, payment by instalment and abolition of the quota, as a way of checking taxi licence speculation.

Mr President, with these remarks, I support the motion.

MR WONG WAI-YIN (in Cantonese): Mr President, taxi licence speculation, taxi fare and the quality of taxi service have been big problems in recent years. They have aroused the public's concern. The Government, too, has come to see the seriousness of the problems and published the Consultative Paper on Taxi Policy Review in October last year, which makes some recommendations about the problems and invites the public to comment on them. The consultation period will expire in a few days. The timing of today's debate is exactly right.

The taxi licensing system and taxi licence speculation perhaps are the main concerns of the Government and the public. This may be why the scope of the present policy review is not broad enough. The consultative paper, too, focuses its attention on how to improve the present licensing system. Firstly, the Government has once again failed to define the role of taxis among all public transport services. Secondly, the review has not touched on the impact of taxis on road traffic conditions (especially during the peak hours); nor dealth with traffic accidents involving taxis. In fact, these are important elements to be factored into taxi policy. Since the paper does not include a review of the role of taxis among all public transport services, it has fallen into a state such that it "sees the trees but not the forest".

Mr President, there is one point that I wish to make in particular. The working group that prepared this consultative paper said in Paragraph 2, Chapter 3, concerning the soaring taxi licence premium, that, in its opinion, the soaring taxi licence premium was brought about by the falling interest rate and indeed by the rising need for investment instruments and not by the licensing