HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2005 OFFICIAL RECORD OF PROCEEDINGS
Wednesday, 26 January 1994
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 MRS ANSON CHAN, C.B.E., J.P.
THE FINANCIAL SECRETARY
THE HONOURABLE SIR NATHANIEL WILLIAM HAMISH MACLEOD, K.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 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.
DR THE HONOURABLE DAVID LI KWOK-PO, O.B.E., LL.D., 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 RONALD JOSEPH ARCULLI, O.B.E., J.P.
2006 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 THE HONOURABLE MARTIN GILBERT BARROW, O.B.E., J.P. 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., J.P. 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, O.B.E., J.P. THE HONOURABLE MOSES CHENG MO-CHI
THE HONOURABLE MARVIN CHEUNG KIN-TUNG, O.B.E., J.P. 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, O.B.E., J.P.
DR THE HONOURABLE LAM KUI-CHUN
DR THE HONOURABLE CONRAD LAM KUI-SHING, J.P. THE HONOURABLE LAU CHIN-SHEK
THE HONOURABLE EMILY LAU WAI-HING
THE HONOURABLE LEE WING-TAT
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2007 THE HONOURABLE ERIC LI KA-CHEUNG, J.P.
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
THE HONOURABLE JAMES TIEN PEI-CHUN, O.B.E., J.P.
THE HONOURABLE ALFRED TSO SHIU-WAI
IN ATTENDANCE
MR ALISTAIR PETER ASPREY, C.B.E., A.E., J.P.
SECRETARY FOR SECURITY
MR ANTHONY GORDON EASON, J.P.
SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS
MR HAIDER HATIM TYEBJEE BARMA, I.S.O., J.P.
SECRETARY FOR TRANSPORT
MR GORDON SIU KWING-CHUE, J.P.
SECRETARY FOR ECONOMIC SERVICES
2008 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
MR DONALD TSANG YAM-KUEN, O.B.E., J.P.
SECRETARY FOR THE TREASURY
MR MICHAEL DAVID CARTLAND, J.P.
SECRETARY FOR FINANCIAL SERVICES
MR LAM WOON-KWONG, J.P.
SECRETARY FOR EDUCATION AND MANPOWER
THE CLERK TO THE LEGISLATIVE COUNCIL
MR CLETUS LAU KWOK-HONG
THE DEPUTY CLERK TO THE LEGISLATIVE COUNCIL MR PATRICK CHAN NIM-TAK
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2009 Papers
The following papers were laid on the table pursuant to Standing Order 14(2): Subject
Subsidiary Legislation L.N. No. Companies (Forms) (Amendment) Regulation 1994 .............................. 59/94
Fixed Penalty (Criminal Proceedings) (Amendment)
Regulation 1994 .............................................................................. 60/94 Road Traffic (Parking) (Amendment) Regulation 1994.......................... 61/94
Road Traffic (Public Service Vehicles) (Amendment) (No. 2)
Regulation 1994 .............................................................................. 62/94 Road Traffic (Traffic Control) (Amendment) Regulation 1994 .............. 63/94 Business Registration (Amendment) Regulation 1994 ........................... 64/94 Dangerous Goods (General) (Amendment) Regulation 1994 ................. 65/94
Dangerous Goods (Government Explosives Depots)
(Amendment) Regulation 1994 ....................................................... 66/94 Mines (Safety) (Amendment) Regulation 1994 ...................................... 67/94 Mining (General) (Amendment) Regulation 1994 .................................. 68/94 Designation of Libraries (Urban Council Area) Order 1994................... 69/94
Hong Kong Academy of Medicine (Addition of Schedule)
Order 1994 ...................................................................................... 70/94
Public Health and Municipal Services (Public Pleasure Grounds)
(Amendment of Fourth Schedule) Order 1994 ................................ 71/94
Public Health and Municipal Services (Stadia)
(Amendment of Twelfth Schedule) Order 1994 .............................. 72/94
2010 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
Public Order Curfew (Variation) Order 1994.......................................... 73/94 Adoption (Amendment) Rules 1994 ....................................................... 74/94 Hawker (Urban Council) (Amendment) Bylaw 1994 ............................. 75/94 Pleasure Grounds (Urban Council) (Amendment) Bylaw 1994.............. 76/94
Travel Industry Compensation Fund (Amount of
Ex Gratia Payments and Financial Penalty) Rules
(L.N. 471 of 1993) (Commencement) Notice 1994......................... 77/94
Travel Industry Compensation Fund (Procedure for
Ex Gratia Payments) Rules (L.N. 472 of 1993)
(Commencement) Notice 1994........................................................ 78/94
Sessional Paper 1993-94
No. 51 — Report of changes to the approved Estimates of Expenditure approved during the second quarter of 1993-94 Public Finance Ordinance : Section 8
Miscellaneous
Technical Memorandum for Issuing Air Pollution Abatement Notices to Control Air Pollution from Stationary Polluting Processes
Oral answers to questions
Mortgage administrative fees
1. MR PANG CHUN-HOI asked (in Cantonese): Will the Government inform this Council:
(a) whether the Government will adopt measures to regulate the practice of some banks to charge mortgage applicants administrative fees which are non refundable under any circumstances for the sake of suppressing property speculation; if not, what the reasons are; and
(b) how the Government monitors banks in regard to the charging of various administrative fees, and whether guidelines and criteria will be issued?
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2011 SECRETARY FOR FINANCIAL SERVICES: Mr President,
(a) The Hong Kong Monetary Authority has conducted a survey which covers most of the main players in the mortgage market and this shows that application fees for mortgage loans typically vary between $1,000 and $2,500 for each application from individuals. Such fees are non-refundable and are mainly intended to cover the banks' handling charges. We do not think however that such charges would by themselves have a significant effect in discouraging property speculation.
The Government believes that the levy of such charges is a commercial matter for the banks and does not consider there to be a problem that merits intervention. It should be noted that not all banks charge application fees. Mortgage applicants therefore do have a choice in the matter.
(b) As regards part (b) of the question, it is not the Government's practice to monitor banks with regard to the charging of administrative fees. This is, as I have mentioned before, normally regarded as a commercial decision by individual banks. There is, therefore, no plan to issue any guidelines in this respect.
MR PANG CHUN-HOI (in Cantonese): Mr President, in the past, banks usually charged only $1,000 to $1,500 for handling each mortgage application and this was charged only after the application had been approved. But now application fees, some as high as $2,500, are charged and they are non-refundable under whatever circumstances. The Government believes that the levy of such charges is a commercial matter for the banks and does not consider it a problem that merits intervention. If in future the banks consider that they have to further increase application fees and the increase is to such an extent that the consumers can hardly afford or that they are unjustifiably high, will the Government not take any action in such circumstances?
SECRETARY FOR FINANCIAL SERVICES: Mr President, that does seem to be a somewhat hypothetical question but, as I have indicated, the matter of charging administrative fees does seem to us to be a commercial matter for banks. There is a cost to the bank in processing an application. That cost would have to be absorbed one way or another. The banks could either absorb it into their general costs and pass it on to the generality of their customers, or they could pass it back, as most of them do at present, to the individual customer who commissioned the service, or they could combine it with another charge, such as the interest for the actual loan, so that it would be subsumed in that way. But whatever the situation, there is a cost to the banks and it does seem to be a matter of commercial judgment as to how they reflect this and how they recover it.
2012 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
DR DAVID LI: Mr President, has the Administration undertaken any comparative study of the administrative fees charged by banks for processing mortgage applications in Hong Kong to protect banks from substantial losses due to the practice of shopping around for a mortgage, and those charged by other countries in the region, where, I understand, the administrative costs to a mortgage applicant are generally higher than that in Hong Kong?
SECRETARY FOR FINANCIAL SERVICES: Yes, Mr President, as I mentioned in my main answer, the Monetary Authority has looked at the situation in Hong Kong and two points emerged. One is that whilst some banks felt that there would be an effect from these charges in discouraging property speculation, quite a number of banks felt that there was a different sort of speculative element, namely the type of fishing expedition to which Dr LI has just referred. That is to say, where a customer puts in several parallel applications to a number of different banks and then selects only one of them for acceptance at the end of the day. Now this puts the banks to a certain amount of work for which there is no return and it is quite understandable, therefore, that the banks would wish to deter that type of activity.
We have not undertaken any detailed international comparison and would be a little bit concerned as to how meaningful that would be, given the differences between the regulatory regimes, the mix of charges, other elements such as rents, and the fact that the general banking environment is quite different from one country to another. So such a comparison may be quite complex and perhaps not very conclusive.
MR ROGER LUK (in Cantonese): Mr President, it is mentioned in paragraph (b) of the Secretary's reply that the banks have no plan to issue any guidelines on the charging of application fees. Will the Secretary inform this Council whether the Hong Kong Association of Banks has any guidelines on fees charged by banks for different services?
SECRETARY FOR FINANCIAL SERVICES: Mr President, with regard to fees for mortgages, the answer is no. The Hong Kong Association of Banks has actually very few guidelines in the area of service charges generally, and they relate only to the very limited areas of certain trade finance and securities transactions, but not with regard to mortgage applications.
MR PETER WONG: Mr President, will the Secretary inform this Council whether the banks make it very clear right at the beginning that such non-refundable fees are payable?
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2013
SECRETARY FOR FINANCIAL SERVICES: Mr President, it is the normal practice of banks to provide all the relative information on their services and products, on request, to their customers. Some of them actually go to the extent of putting their charges up in the banking halls, and indeed, that practice is encouraged by the Administration.
DR TANG SIU-TONG (in Cantonese): Mr President, it is mentioned in part 2 of paragraph (a) of the Secretary's reply that "not all banks charge application fees". May I have a rough figure as to the proportion of banks that charge application fees to those that do not?
SECRETARY FOR FINANCIAL SERVICES: Mr President, there are about 33 banks in Hong Kong that account for about 94% of the mortgage lending, and the bulk of them do charge a fee of one sort or another, in the range which I mentioned, to individuals making applications. I do not have the precise figure as to the proportion but could provide it if Members so desire. (Annex I)
MR PANG CHUN-HOI (in Cantonese): Mr President, I would like to cite an actual case for the Administration's consideration. Bank A charges $2,500 "evaluation fees" (not application fees) for evaluation of property. However in less than 24 hours the customer is informed that his application is rejected without being given a full explanation. The customer then goes to bank B. The bank informs the customer after 48 hours that his application has been approved and that an application fee of $1,000 is charged. As I say, bank A informs its customer in less than 24 hours that his application is rejected and charges him $2,500 all the same. I think this is very unreasonable. As such chaotic situation does exist, why does the Administration turn a blind eye to it? Will it not ask the Commissioner of Banking to investigate into it to see if it is acceptable and whether guidelines should be given to banks in this respect?
SECRETARY FOR FINANCIAL SERVICES: Mr President, as I have indicated, there is a cost to the bank in handling an application. It is not just the matter of preparing the necessary paperwork but there also has to be a judgment made with regard to the property and with regard to the credit worthiness of the client himself. Different banks have different rates. The range is not big and the fees themselves are quite modest. It is a matter for competition between the banks as to the different rates and how acceptable these are to the customers. If customers are aware that higher fees are charged at some banks and if they regard that as the most important element in the competitive situation, then no doubt they would choose a bank that either charges no fee or one that charges a lower fee. But basically, as I have indicated, it is a matter of choice.
2014 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 Detention in China of Hong Kong residents
2. MR LAU CHIN-SHEK asked (in Cantonese): The Complaints Division of the Office of Members of the Legislative Council has recently received complaints alleging that a number of Hong Kong residents who are deployed by their employers to work in China have been detained as "hostages" because of business conflicts between their employers and manufacturers in China. In this regard, will the Government inform this Council:
(a) whether there were such cases in the past; if so, the number of such cases in the previous three years and the present position of these cases;
(b) where the Government's assistance is sought in such cases, what arrangements the Government will make to assist the detained Hong Kong residents to return safely to Hong Kong at an early date; and
(c) whether consideration has been given to conducting negotiations with the Chinese Government on this issue via the Sino-British Joint Liaison Group or other channels, so as to safeguard the personal safety of Hong Kong residents working in China?
SECRETARY FOR SECURITY: Mr President,
(a) We have received eight applications for assistance in the last three years from families of Hong Kong residents who were reportedly detained as a result of commercial disputes in China. These eight applications involved 10 persons, who are either Hong Kong businessmen or employees of Hong Kong companies doing business in China. The Government has raised all these cases with the Chinese authorities. Two of the cases are outstanding, involving four detainees who have not yet been released and returned to Hong Kong.
(b) The Government takes seriously all reports of Hong Kong residents in distress outside the territory. Where there is reason to believe that a Hong Kong resident is being unlawfully detained in another country, we follow up with the authorities concerned. For the eight cases I have mentioned, we have made repeated requests to the Chinese authorities for clarification of the basis on which the Hong Kong individuals have been detained, for assurances that this is consistent with Chinese Law, and for access for the individuals' families, legal advisers and colleagues. All these approaches have been made in accordance with the wishes of the families.
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2015
(c) We have well-established channels for raising cases of this kind with the Chinese authorities. Our representations have been carried out in Hong Kong through the Political Adviser's Office, and in some cases also, through the Foreign and Commonwealth Office in London and the British Embassy in Peking.
MR LAU CHIN-SHEK (in Cantonese): Mr President, will the Secretary provide this Council with full details about the 10 detainees involved in these eight cases? Firstly, is their detention lawful or within the Chinese law? Secondly, why are they detained? Thirdly, are they unfairly treated during detention? Fourthly, why are the four persons involved in the two outstanding cases still not released?
PRESIDENT: Have you got all four questions, Secretary?
SECRETARY FOR SECURITY: I think so, Mr President. We have not received full details of these cases from the Chinese authorities. So I am afraid I cannot say on what basis they were detained. And in the case of the four outstanding cases, I do not know the reason for their detention but we are still pursuing those cases with the Chinese authorities. From the information we have received, which sometimes has come to us after the persons detained were released, it does appear that in some cases people were detained purely as a result of a commercial dispute and that once the authorities in China were satisfied that this was a commercial dispute and not a criminal case, they were released. In other cases, it does seem that they may have been detained on suspicion of criminal activities, but as I said, we cannot be sure of the details of this.
MR MARVIN CHEUNG: Mr President, will the Secretary please advise this Council, where it is obvious that the Government has not received appropriate and adequate responses to its requests for clarification, what further action the Government can take to safeguard the safety and rights of our citizens apart from following up through all the various channels as he listed in his reply?
SECRETARY FOR SECURITY: Mr President, I do not think that there is anything more we can do except to follow up these cases which we will continue to do.
MISS CHRISTINE LOH: Mr President, would the Secretary say how successful they think they have been in using these well-established channels; and if they have not been successful at all, then whether there is any chance of reviewing that process?
2016 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
SECRETARY FOR SECURITY: Mr President, it is very difficult to answer that question. We do not know what would have happened in these cases if we had not made representations. So it is, I think, impossible to give a clear answer to that. I would only say that it is our belief that the representations that have been made, in Hong Kong, in London and in Peking, have had some effect in securing the release of the people who have been released in these cases.
MR SIMON IP: Mr President, will the Secretary please tell us what the length of time was for which these 10 detainees were detained?
SECRETARY FOR SECURITY: Mr President, I think perhaps I had better give that answer in writing. I have got details of those cases here but it will take me some time to go through the figures and give all the details. (Annex II)
DR HUANG CHEN-YA (in Cantonese): Mr President, can the Administration inform this Council if it had requested the British Embassy to send their staff to visit the detainees in order to understand each individual case and the reasons for their long detention? If the Administration does not know why these people were detained, then how can it possibly negotiate through diplomatic channels and prevent similar incidents from happening again?
SECRETARY FOR SECURITY: Mr President, as I think I said in my main answer, it is primarily the purpose of our representations to try to find out the basis on which they have been detained. I cannot say that we have always succeeded in that, but that must be the first purpose of our representations. We try to find out the basis on which they are detained, to seek access for their families and their legal representatives, and to get a clear answer to satisfy ourselves that the detention is within the law.
DR HUANG CHEN-YA (in Cantonese): Mr President, the Secretary has not answered the first part of my question, that is, whether the British Embassy had sent their staff to visit the detainees.
SECRETARY FOR SECURITY: Mr President, certainly these cases have been reported to the British Embassy in Peking and the embassy has, in several cases, made representations in addition to the representations being made in Hong Kong. I do not know, I am afraid, whether they have visited the detainees or how many have been visited.
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2017
DR HUANG CHEN-YA (in Cantonese): Mr President, can the Secretary make a thorough investigation into the matter? If the British Embassy's representations were merely in the form of official correspondence, then the fact may simply be that they had not given any assistance to these Hong Kong people at all. So will the Secretary confirm whether the Hong Kong Government has requested the British Embassy to send their staff to visit the detainees?
PRESIDENT: A written answer, Secretary?
SECRETARY FOR SECURITY: Yes, Mr President, as I said, I do not know how many have been visited but I will certainly supply that in writing. (Annex III)
MR HOWARD YOUNG: Mr President, can the Secretary inform us what factors are taken into account in deciding whether to use the channel of the Political Adviser's Office or through the Foreign and Commonwealth Office and the Embassy? Are there different criteria for different people, because the cases always seem to be the same type of commercial dispute cases?
SECRETARY FOR SECURITY: No, Mr President, I do not think there are different criteria. We would always raise cases through the Political Adviser's Office and the New China News Agency in Hong Kong. And we would normally report these cases to Peking at the same time.
MR WONG WAI-YIN (in Cantonese): Mr President, the Secretary says in paragraph (a) of the reply that "we have received eight applications for assistance". Did the Secretary know the number of cases in which people had not approached the Hong Kong Government for help? If not, had the Secretary taken the initiative in asking the Chinese authorities to provide the relevant figures? If not, why not?
SECRETARY FOR SECURITY: Mr President, no. I think, by definition, if we do not know of these cases we do not have any details of them.
MR WONG WAI-YIN (in Cantonese): Mr President, the Secretary has not answered the second part of my question. My question is: Why had the Secretary not taken the initiative in asking the Chinese authorities to provide the relevant figures?
2018 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
SECRETARY FOR SECURITY: Mr President, I do not think it would be possible to answer a question like that. We have to have details of the cases, and then take them up with the Chinese authorities. If anybody else has details of any further cases, then we would be happy to have them and to look at them. But as I say, we do not know of any other cases.
MR CHIM PUI-CHUNG (in Cantonese): Mr President, the Secretary says in paragraph (b) of his reply that "Where there is reason to believe that a Hong Kong resident is being unlawfully detained in another country, we follow up with the authorities concerned". Referring to the eight cases mentioned earlier, are they all confirmed unlawful detention cases or cases of a different nature? If it cannot be established that they are indeed unlawful detention cases, does it say anything about what the Hong Kong Government believes, that is, what it believes to be true becomes doubtful?
PRESIDENT: What is your question, Mr CHIM?
MR CHIM PUI-CHUNG (in Cantonese): Mr President, the Hong Kong Government firmly believes that cases relating to unlawful detention of Hong Kong residents in other countries will be followed up. My question is: Has the Administration confirmed that all these are unlawful detention cases? If not, does it mean that what the Hong Kong Government believes to be the case may be interpreted differently under the laws of other countries?
PRESIDENT: I am afraid that is still not a question, Mr CHIM.
MR CHIM PUI-CHUNG (in Cantonese): Mr President, the Hong Kong Government believes that the eight cases it followed up are unlawful detention cases. May I know if they are confirmed to be so, that is, simply give a "yes" or "no" answer? My supplementary that follows would be: Will what one is assured of turn out not to be the case?
PRESIDENT: The first question, Secretary.
SECRETARY FOR SECURITY: Mr President, I do not think my answer said that the Hong Kong residents in these eight cases had been unlawfully detained. I do not think it even said that we believe that they had been unlawfully detained. What it said is that where there is reason to believe that a Hong Kong resident is being unlawfully detained. I think, in other words, where we have a report or an allegation, either from families or colleagues, that someone appears to have been unlawfully detained, then we would seek to take it up with the
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2019
authorities concerned in order to establish the facts and find out whether the persons have been unlawfully detained. In the eight cases to which I referred in the first paragraph of my answer, I can only say that we have not had satisfactory replies.
MR JAMES TIEN: Mr President, like the Honourable WONG Wai-yin, I am surprised that with tens of thousands of factories, either joint ventures or wholly-owned, operating in China, we have only received eight applications for assistance in the last three years. Will the Secretary please inform us whether, for example, the Industry Department could do more to make the public aware that such help by the Hong Kong Government is available to local factory owners and employees working in China?
SECRETARY FOR SECURITY: Mr President, what I would say is that I think the recourse to the Immigration Department in these cases is quite well known amongst the general public and that is where most of the reports that we have had were received. And I think that it is well known that if someone requires assistance in cases such as these, he should make application to the Immigration Department.
I am afraid I simply do not know about the Industry Department. I can only offer to refer that to my colleague, the Secretary for Trade and Industry.
Tuen Mun midstream operation zone
3. MR ALFRED TSO asked (in Cantonese): In view of the Government's plan to designate a mid-stream operation zone in Area 16 of Tuen Mun and the action taken to invite tenders for that purpose, will the Government inform this Council:
(a) in implementing the plan against strong objection from the Tuen Mun District Board, whether the Government neglects public opinion and attaches little importance to the standing of the district board;
(b) what measures will be in place to ensure that the busy activities of cargo handling at sea arising from the implementation of the plan will not endanger the safety and order of the typhoon shelter nearby, particularly when the shelter is fully packed with vessels during the onslaught of typhoons; and
(c) whether assurance can be given that any additional transport activities consequent upon the implementation of the plan will not further deteriorate the external road traffic of western New Territories?
2020 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
SECRETARY FOR ECONOMIC SERVICES (in Cantonese): Mr President, let me first reassure Honourable Members that the Administration accords high priority to public opinion and to advice given by district boards. In this particular case, we have been in close touch with the Tuen Mun District Board and other sectors of the local community since the proposal to establish a temporary mid-stream backup site at Tuen Mun Area 16 was first raised in December 1992.
As Members know, we have a problem of shortage of land needed to support Hong Kong's mid-stream operation. The Port Development Board did an extensive search to identify suitable sites. After studying some eight sites, virtually every possible site in the territory, Area 16 in Tuen Mun was the only one found to be available. Since then, Government representatives have attended 11 meetings of the district board and the working group set up to consider issues related to the use of the site. We have listened carefully to members' views and we have noted all their concerns.
Now, what are the concerns that have been expressed to us? Essentially they are that temporary use of the site will generate additional traffic on already congested roads, it will create noise in the area and adversely affect safety within the typhoon shelter. But these concerns can be addressed; they can be resolved:
(a) we shall prohibit direct land access to the site by vehicles. Cargo will only be transported by sea, keeping additional loads off the existing highway network;
(b) we shall prohibit work at the site outside prescribed hours, so there will not be any night-time noise. We will also deploy patrolling watchmen to monitor this;
(c) we shall insist that the operator adopts specific noise mitigation measures to the satisfaction of the Director of Environmental Protection; and
(d) we shall step up management of the waters within the typhoon shelter to deal with the small volume of additional marine traffic.
Regarding marine traffic, we envisage that the operation of the site will generate about ten barge trips each day. This is well within acceptable limits. The barges using the site will be confined to the western fairway and western entrance to the typhoon shelter. Conflict with other vessels will then be minimized. In addition the Director of Marine will step up traffic management within the typhoon shelter by demarcating the anchorage area to separate barges and fishing vessels. This should avoid conflict both during normal weather and during typhoons.
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2021
The Administration has discussed in detail with concerned groups and district board representatives. At this point, may I pay tribute to the Honourable Members and the Tuen Mun District Board who have played such an active part on this issue. At least four Members of this Council have raised the issue with me: the Honourable LAU Wong-fat, the Honourable WONG Wai-yin, the Honourable Michael HO and the Honourable Alfred TSO. The vigour with which they, in particular, have pursued the matter reflects well on their commitment to the well-being of the community, and in a way, demonstrates how district administration works at its best. Both the Deputy Secretary for Planning, Environment and Lands and I have personally met district board representatives. The protracted consultation we have undertaken is a demonstration of our commitment to full consultation. It is a matter of record that the Administration did not begin tendering work until after the Tuen Mun District Board had voted, on 10 August 1993, not to object to the proposal. Whilst we have not been able to accede to the board's subsequent change of heart, we have been able to address the substance of its concerns.
Mr President, if the Administration could find other suitable sites in the western New Territories, we would not have looked to Tuen Mun for help. If we could find a better site in Tuen Mun for temporary use we would not have chosen Area 16. But my conscience is clear, we have had no other choices. Therefore, recognizing local concerns about the potentially adverse implications of using Area 16, the Administration will rigorously enforce the lease conditions of the site. We shall monitor and control its use so that there will be as little adverse effect on the local community as is possible.
MR ALFRED TSO (in Cantonese): Mr President, the Secretary has explained that the mid stream operation in Area 16 is basically cargo handling at sea, and therefore land transport is not necessary. In such circumstances, will the Administration consider using other small islands at Ning Ding Yang for container operation instead of using the land at Tuen Mun Area 16 as this can minimize the effects on the typhoon shelter and will not bring additional load to the land transport in western New Territories?
SECRETARY FOR ECONOMIC SERVICES (in Cantonese): Mr President, first of all, I would like to thank Mr Tso for his proposal. Area 16 will be let out for a period of one year to start with, and may be extended every three months thereafter. Meanwhile, the Administration will study the practicability of using other islands off western New Territories, like the Brothers Islands, Lung Kwu Chau, Pak Chau and Sha Chau, for mid stream operation. Certainly, some alteration works have to be carried out before vessels can berth at these islands. So I think the feasibility study will take quite some time. But, we will look into it.
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MR LAU WONG-FAT (in Cantonese): Mr President, will the Administration inform this Council whether it has any plans to conduct a review after the mid-stream operation zone has been operated for a while to assess its effects on Tuen Mun district? Should the traffic conditions on Tuen Mun Highway further deteriorate, will the Administration reconsider providing a mass transit link between Tuen Mun and Tsuen Wan?
SECRETARY FOR ECONOMIC SERVICES: Mr President, I shall try to answer the first part of the question and then, with your permission, I would defer to the Secretary for Transport on the points relating to transport.
In view of the concerns expressed, we are going to start monitoring, not after the site has been operated for a while but right from the very beginning. We would monitor it from day one and we will keep it under constant monitoring. And with your permission, Mr President, I shall defer to the Secretary for Transport with regard to the other points.
SECRETARY FOR TRANSPORT: Mr President, as far as Tuen Mun Highway is concerned, the Administration certainly appreciates that there is a great deal of congestion, and various steps are being taken to solve this problem. Very briefly, these include the construction of climbing lanes and the widening of various sections of Castle Peak Road. And, of course, when the Ting Kau Bridge is ready, this will also help ease the congestion. As regards the rail extension, this is part of the Railway Development Study, which will be completed in the next two or three months. But at this stage, indications are that a link to Tsuen Wan will be a very low priority.
MR EDWARD HO: Mr President, the Secretary referred to the use of Area 16 of Tuen Mun as temporary. Will he please inform this Council how temporary is "temporary"? And when can a permanent midstream back-up site be available to cope with the ever-increasing and vital port activities?
SECRETARY FOR ECONOMIC SERVICES: Mr President, our intention is to award this particular site for a period of one year to start with and then to extend, if necessary, every three months thereafter. There are currently studies on the possibility of using other areas, such as Area 38, and also, as Mr TSO has suggested just now, maybe some islands in the Pearl River Delta Estuary, as transshipment centres.
MR ALBERT CHAN (in Cantonese): Mr President, at present the throughput of mid stream operation is 3 million containers a year. The Secretary has said that after studying 8 sites, no suitable site of mid-stream operation can be identified. From the case of Tuen Mun Area 16, it is apparent that the Administration has
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made mistakes in planning, resulting in a host of problems that the Administration has to deal with now. In its long-term planning, especially when it comes to port development, will the Administration consider, among other things, the land required for mid-stream operation? And how will this be implemented should it be given the go-ahead?
SECRETARY FOR ECONOMIC SERVICES (in Cantonese): Mr President, according to our estimate, we need about 30 hectares of land as backup sites for mid-stream operation. After taking in Tuen Mun Area 16 which can provide about 10 hectares of land, we still need about 20 hectares of land. At present, we are considering, in the context of long-term land use, whether suitable sites can be identified along the coast (including Area 38 of Tuen Mun as I mentioned), with a view to reserving as much land as possible for backup purposes.
MISS EMILY LAU (in Cantonese): Mr President, the Secretary said in his reply that the Tuen Mun District Board had voted on 10 August 1993 not to object to the Government's proposal but changed its mind thereafter. Will the Administration inform this Council why the district board changed its mind?
SECRETARY FOR ECONOMIC SERVICES (in Cantonese): Mr President, we know that the District Board objected subsequently because they worried about inadequate monitoring on the part of the Administration, which would see the users bringing different problems after the site had been awarded. We have conducted a lot of studies on this, and the result is that the Administration will, as I can assure Members, monitor the situation. So we believe that the above situation will not happen.
DR TANG SIU-TONG (in Cantonese): Mr President, the Marine Department has closed the cargo handling area at Tai Lam Kok of Tuen Mun from 5 January this year and arrangements have been made for cargo ships to use Area 16 in Tuen Mun. Has the Administration in effect turned Tuen Mun Area 16 into a mid-stream operation zone before the tendering result is out?
SECRETARY FOR ECONOMIC SERVICES (in Cantonese): Mr President, this question may have to be answered with the aid of a map because the Tuen Mun Harbour has a very long coastline and Area 16 mentioned earlier only takes up a small stretch of it. We have just started the tendering exercise. Successful tenderer will be allowed to use the site for mid-stream operation. As the tender has not been awarded, nobody should have been operating there. The area referred to by Dr TANG is a stretch of land along the coast adjacent to Area 16. The Administration has approved the use of that area for cargo handling but not mid-stream operation.
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MR MICHAEL HO (in Cantonese): Mr President, just now the Secretary has referred to the views I put to him but regrettably the problem has still not been resolved. I would like to follow up paragraph 3(a) of his reply, that is, "Cargo will only be transported by sea, keeping additional loads off the existing highway network". Will the Administration inform this Council what specific measures it will take to ensure that there will be no land access to the site so that it will not bring additional traffic load?
SECRETARY FOR ECONOMIC SERVICES (in Cantonese): Mr President, there are three measures that the Administration will take. Firstly, it will be stated clearly in the lease that users may only have access to the site by vessels but not vehicles. Secondly, the site will be fenced off by barricades so that even if contractors want to switch to land transport, it will not be easy for them to do so. Thirdly, the Administration is considering, apart from barricades, a buffer zone in which trees and stones will be used to fence off the area, so as to pose another obstacle to those who go against the law.
MR PETER WONG: Mr President, when assessing the eight possible sites, were environmental impact assessments prepared, and was the environmental impact assessment for the chosen site made available to the Tuen Mun District Board for their reference?
SECRETARY FOR ECONOMIC SERVICES: Mr President, I confirm that we did carry out environmental impact assessment studies on each of the sites which we intend to use for this type of purpose, and we did discuss with the district boards the measures to be taken to reduce environmental disturbances to the minimum.
PRESIDENT: Not answered, Mr Peter WONG?
MR PETER WONG: Yes, Mr President, the Secretary has not answered whether the EIA itself was made available to the district board for their reference.
SECRETARY FOR ECONOMIC SERVICES: I will have to go back, Mr President, and check whether in fact the entire report itself was tabled. But what I have been told is that the findings — in particular those findings of fact as regards protection and reduction of disturbance to the environment — were discussed.
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2025 Fund management companies
4. MR ERIC LI asked (in Cantonese): A well known fund management company recently disseminated and publicized some market-influencing information whilst engaging in speculative transactions of securities and index futures. Moreover, the company reversed its views on the Hong Kong stock market trends within a short period with the result that small investors were at a loss as to what course to follow, while it profited from the situation. Will the Government inform this Council how such mode of operation can be prevented under the existing regime of monetary supervision?
SECRETARY FOR FINANCIAL SERVICES: Mr President, the Administration does not accept that the mode of operation described in the question would necessarily be wrong unless it could be shown that the company concerned had engaged in transactions in anticipation of the effects of potentially market-influencing information which it subsequently disseminated and publicized. It is part of the normal business of investment houses to conduct transactions in securities and futures. It is also not uncommon for these firms to conduct market analysis, taking into account factors such as economic fundamentals and outlook, the prevailing investment sentiment as well as the relative attractiveness of different markets from a regional or even global perspective. Equally common is that they would normally publicize their assessments and update them constantly to reflect market conditions which at times can change abruptly. I believe that Hong Kong is no different from other major financial centres in the world in these respects.
When made public, professional assessments might well have an impact on the perception of other investors, but how or indeed whether to follow such advice and assessments publicly disseminated is a matter for the judgement of the individual investor.
It is the normal practice of major investment houses to separate the research arm from the trading arms of their operations with a view to preventing the misuse of non-public information. Moreover there are provisions in the respective Codes of Conduct of the Stock Exchange of Hong Kong Limited and the Hong Kong Futures Exchange Limited which stipulate that their members shall not invest on their own account upon advance knowledge of pending transactions or any other non-public information the disclosure of which would be expected to affect prices. Similar provisions are included in the Codes of Conduct for registered persons in the financial industry being finalized by the Securities and Futures Commission. The industry has been consulted on the draft Codes which are expected to be effective on 1 February.
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Failure to comply with such requirements would result in disciplinary actions by the market regulators. So far, the Securities and Futures Commission and the two exchanges, which conduct ongoing surveillance of the market, have not identified any evidence of such activities.
MR ERIC LI: Mr President, the Government always emphasizes that Hong Kong is a level playing field in the context of business and investment. I presume that it means fairness to all large and small investors. In the main reply it seems that the Government will still allow this type of practice of highly questionable ethics. In the recent case of Morgan Stanley the Government had to launch an in-depth investigation in response to public criticisms in order to judge the innocence or guilt of the said investment house. Is it the case then that that is the Government's answer to what appears to be double standard games played by investment houses, and that it will conduct expensive investigations at the cost of taxpayers every time?
SECRETARY FOR FINANCIAL SERVICES: Mr President, the Administration does not accept the implications of the question that has just been put forward. The case of Morgan Stanley is one that was investigated as a result of concerns expressed by market practitioners and by the media. The Securities and Futures Commission conducted a thorough investigation and found no evidence of trading patterns that would be consistent with the type of behaviour that was mentioned in the main question. And I would not wish to leave any doubt about this, which is that the Administration does not regard unethical practice as something that should be condoned or tolerated. Indeed it would be taken into account by the Securities and Futures Commission in considering the fitness and properness of persons or firms for registration. So the consequences of unethical behaviour could be very serious indeed.
DR PHILIP WONG (in Cantonese): Mr President, a major way the financial market is monitored at present is to prohibit any transaction using information that will have specific effect on market prices. I believe that when Morgan Stanley set out to buy in large quantities of Hong Kong stocks, it was fully aware of the great impact on the Hang Seng Index. And I would say it had already taken up a significant number of Hang Seng Index Futures contracts before it "placed its bets". Was the company using non-public information when it bought in the futures contracts? If yes, was it "rigging the market"?
SECRETARY FOR FINANCIAL SERVICES: Mr President, as I have indicated, it would be necessary to establish that there was some direct connection between trading patterns and the release of non-public information designed to influence the market. Such connection was not apparent in the case which has been referred to, quite the reverse. The Securities and Futures Commission looked very thoroughly at it and found no evidence of trading
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patterns either in the Futures Exchange or in the Stock Exchange — or of global trading patterns which were also examined — that would point to any such misbehaviour.
MR ROGER LUK: Mr President, will the Administration advise this Council whether the market regulators would verify whether the investment houses have actually carried out the investment advice themselves?
SECRETARY FOR FINANCIAL SERVICES: Mr President, the Securities and Futures Commission and the two exchanges do conduct regular inspections of the members of the exchanges and also of registered practitioners who are not members but who are nevertheless active in the Hong Kong market. There are annual inspection programmes which aim to cover most, if not all, of the practitioners on a regular basis. Where individuals obtain the information for their assessments is a matter for their own research and the thrust of market surveillance is to seek to find misbehaviour. Now misrepresentation might well be a part of that but there has so far been no sign of that sort of misbehaviour having emerged.
MR RONALD ARCULLI: Mr President, will the Administration confirm that, inasmuch as Hong Kong's reputation as one of the leading financial centres of the world depends on houses like Morgan Stanley behaving themselves and observing the market rules here, the Administration is satisfied in this particular case that nothing untoward has happened?
SECRETARY FOR FINANCIAL SERVICES: Mr President, the Administration is satisfied that in this case there has been a thorough investigation and that no evidence has come to light to suggest any misbehaviour.
MR VINCENT CHENG: Mr President, I do not know whether it is necessary. But I just want to declare interest as a director of the Securities and Futures Commission and that I have seen the report.
PRESIDENT: There is no question, Mr CHENG?
MR VINCENT CHENG: No, Mr President.
DR HUANG CHEN-YA (in Cantonese): Mr President, it appears the Administration is telling this Council that this investment house had not used any information for insider trading. On the two occasions when information was
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disseminated, how many Hang Seng Index Futures contracts or stocks had it traded and had it bought in large quantities of stocks after pushing share prices down? We all know that monitoring this kind of insider trading is always better than investigation afterwards which requires going through all the records. Will the Administration advise this Council whether the transactions of these large investment houses will be closely monitored in future?
PRESIDENT: Secretary, two questions.
SECRETARY FOR FINANCIAL SERVICES: Perhaps, I should clarify first, Mr President, that this is not insider trading as such. Insider trading is a matter which relates to the knowledge of an individual company and is dealt with under a specific piece of legislation. What we are talking about here is a matter that was originally a matter of ethical standards and is now a matter of regulatory standards in terms of breaches of the Codes of Conduct. And, as I have already indicated several times, no evidence of such breaches came to light. But I can assure Members of this Council that the regulatory authorities both in the exchanges and the Securities and Futures Commission will be maintaining a high level of market surveillance with a view to deterring the sort of behaviour that is referred to in this question and in order to catch anyone who is engaged in it.
MR CHIM PUI-CHUNG (in Cantonese): Mr President, the Securities and Futures Commission and the exchanges did receive in the past broker's complaints against investors (many of these complaints could be substantiated after investigations). From the Secretary's response to the case referred to by Members, it appears that the Administration also considered that there might be something not as desirable. The main problem here is the lack of evidence. So will the Administration follow up if there are similar cases in future?
SECRETARY FOR FINANCIAL SERVICES: Mr President, the Administration keeps in close touch with the Securities and Futures Commission and follows its work very closely. And certainly we will ensure, as will the Securities and Futures Commission, that reasonable international standards of market surveillance are maintained here and that misbehaviour and market manipulation and such like are deterred and prevented as far as possible.
Laws on contempt of court
5. MR SIMON IP asked: Will the Administration inform this Council of the reasons for its failure to propose comprehensive laws on contempt of court, notwithstanding the report of the Law Reform Commission published in 1986 recommending enactment of such laws?
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ATTORNEY GENERAL: Mr President, the Administration has considered the Law Reform Commission's Report on Contempt of Court very carefully in the light of developments since the report was published. In particular it has noted that:
(1) the common law rules relating to contempt have continued to develop;
(2) the law of contempt has become subject to Article 16 of the Bill of Rights, which provides for freedom of expression; and
(3) the United Kingdom legislation that provided the basis for many of the Law Reform Commission's recommendations, that is, the Contempt of Court Act 1981, has created greater complexity and uncertainty in the law and has not been copied in any other jurisdiction.
In these circumstances the Administration doubts that codification of the law of contempt is either necessary or desirable.
MR SIMON IP: Mr President, I should like to quote two brief passages from the Law Reform Commission's Report. "Restraints on the media are just as unacceptable if they stem from editorial fear of punishment due to the uncertainty of the law". "The law must draw the line between the need to ensure the proper administration of justice and freedom of speech. It can never be easy to know exactly where that line should be drawn but it is in the interests of neither for there to be uncertainty". Is the Attorney General suggesting that developments in the law have removed all or most uncertainties? If so, can be supply details? If not, what justification is there for the Government not taking any action to remove those uncertainties so as to promote freedom of the press?
ATTORNEY GENERAL: Mr President, the developing common law has provided new principles relating to contempt of court. Allied to that, as I have said in my main answer, we now have in Hong Kong Article 16 of the Bill of Rights. I would suggest that those who need to know what the law of contempt is will find that the combination of the developing principles of the common law and Article 16 provide a ready basis for ascertaining whether or not conduct will or will not amount to contempt of court.
MR MAN SAI-CHEONG (in Cantonese): Mr President, can the Attorney General explain subparagraph (2) of his reply, that is, how the law of contempt has become subject to Article 16 of the Bill of Rights, which provides for freedom of expression? If the Administration is not prepared to codify the laws applicable to Hong Kong, will reporters become fearful when covering court
2030 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 cases which will be to the detriment of press freedom and the public's right to know?
ATTORNEY GENERAL: Mr President, the effect of Article 16 of the Bill of Rights is that any restriction on the freedom of expression imposed under the law of contempt must be truly necessary to protect the administration of justice and that the requirement of necessity incorporates the principle of proportionality. That is to say, any restriction should be proportional either to the benefit to be obtained or to the mischief to be avoided. Let me go on to say that, having adopted Article 16 of the Bill of Rights, that will enable the courts to take into account the case law from the European Court of Human Rights on freedom of expression based on a similar provision in the European Convention on Human Rights.
As for guidance that journalists and others concerned with these matters could have, I should report that the Committee on the Promotion of Civic Education has in the fairly recent past arranged seminars and workshops on the rule of law, human rights and the legal system in Hong Kong and it is about to publish a report on the theory and practice of court news reporting which includes a very useful digest of Hong Kong cases on contempt of court. I am told that that report will be available to the public at City and New Territories Administration district public enquiry counters and through the Director of Information Services.
MR JAMES TO (in Cantonese): Mr President, after years of in-depth study, the Law Reform Commission, which was appointed by the Governor, has published the Report on Contempt of Court, recommending that the Contempt of Court Act 1981 of the United Kingdom should be adopted and that relevant laws should be codified. If Mr Simon IP had not raised this question today, the Administration would not have openly informed the public how it would deal with the recommendation. Now even though Mr Simon IP did raise this question, the Administration has only spent a few minutes to respond to a question on the recommendation of the report, which the Law Reform Commission has compiled after years of hard work. Is this the proper attitude that a responsible Administration should have in responding to the proposals of the Law Reform Commssion?
ATTORNEY GENERAL: Mr President, it has been quite apparent that since the passing of the Contempt of Court Act 1981 in July 1981 — perhaps if I, with your indulgence, could come back to the effect, as I understand it, of that Act on the law of contempt — there have been considerable developments in the common law both in the United Kingdom and in other common law jurisdictions. As I have indicated in my main answer, that is a developing situation. The Contempt of Court Act 1981 did not of course codify the law of contempt. The 1981 Act was introduced by the British Government following
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an adverse decision in the European Court of Human Rights, the Sunday Times Case 1979 concerning the Thalidomide reporting. The 1981 Act, as I say, was not a code, nor did it replace the common law. And in the view of many, the coexistence of the 1981 Act alongside the common law has given rise to greater complexity rather than greater clarity and it is a view that has been widely expressed by learned commentators and others.
As for the brevity of my answer and whether by so doing I display either any disrespect to this Council or an irresponsible attitude on the part of the Administration, Mr President, it is undeniable that the common law has developed and is continuing to develop in a branch of the law which is, as it has been described, protean in its approach. And I must emphasize that unlike other jurisdictions we now have the added protection afforded by Article 16 of the Bill of Rights.
MS ANNA WU: Mr President, uncertainty of the law can lead to possible abusive prosecution and disrespect for the law. Is there any plan to promulgate guidelines to allow the media to understand at what time publication can become contempt?
ATTORNEY GENERAL: Mr President, with respect, as lawyers say, I do not accept the basic proposition that the law is uncertain. I accept that it is not conveniently contained in one single document but that does not thereby render the law uncertain. I have referred, in an earlier answer to a supplementary question, to the very useful publication about to be released that will afford guidance to members of the media about, among other things, the law relating to contempt, specifically on what I think is now known as the proximity rule, that is, the time within which, if I may so put it, contempt may arise. It is a very good illustration of the common law at work that has been the subject of a number of decisions recently in the 1980s, dealing with the time period within which a publication or a news broadcast may be run.
Mr President, at the risk of going on, I think one of the great strengths of the common law has been its flexibility. I do not believe that one should look askance at the way in which the common law has developed flexibly to meet changing situations. I think that is something commendable. If one attempts to freeze the law which is still in a state of development at any one time, one freezes the law and deprives it of the ability to develop in a way to meet changing circumstances.
MISS EMILY LAU: Mr President, I want to follow up on Ms WU's point about uncertainty. Although the Attorney General does not accept Ms WU's assumption, will the Attorney General undertake to examine this problem because I am sure there are many members of the news profession who find difficulty in understanding this and uncertainty is a problem with some of them?
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Will the Attorney General undertake to look at the problem and see what he can do to help members of the news profession to understand what their responsibilities are and what the parameters are, so that they can operate freely and independently?
ATTORNEY GENERAL: Mr President, as I have already indicated, a very useful publication is shortly to come out covering, among other things, the law of contempt and containing a useful digest of Hong Kong cases on contempt. Additionally, in particular instances, I do from time to time write to editors setting out my views on contempt in relation to particular circumstances, and on occasions issuing warnings. But I think that it is well known that the media have available to them legal advice on what, I accept, are sometimes not easy questions to answer on a particular set of circumstances.
MR MARTIN LEE: Mr President, does the Attorney General not remember that some years ago he took proceedings against a leading English language newspaper for contempt, only to withdraw at the last minute and pay a lot of costs? If the law is that certain, why did the Attorney General fumble on that occasion?
ATTORNEY GENERAL: Mr President, I do not accept that that case was fumbled. If Mr LEE will recall that it was a matter that I answered in this Council in, I think, April 1992, that case was terminated upon the provision of undertakings which were satisfactory to me in the circumstances of that particular case.
MR PETER WONG: Mr President, this is but one of a number of recommendations from the Law Reform Commission that has not been accepted or followed. Would it not be expedient for the Commission to review its own unrequited recommendations to see whether those recommendations are still cogent?
ATTORNEY GENERAL: Mr President, Hong Kong has a very good track record of implementing Law Reform Commission Reports. I would say probably better than a good many other places. Of the 23 reports that have been published by the Commission, 11 have resulted in amending legislation and five more are currently moving through the legislative process. I believe that in one or two cases the recommendations do not actually involve the necessity for legislation but have resulted in changed procedures. So overall we have a good success rate as regards implementing recommendations from the Law Reform Commission.
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2033 Dog licences
6. MR FREDERICK FUNG asked (in Cantonese): Will the Government inform this Council:
(a) whether consideration will be given to strengthening enforcement action under the existing law requiring dog owners to obtain licences for their dogs; and
(b) whether legislative amendments will be introduced to provide for the compulsory use of muzzle when dogs are taken out for walks?
SECRETARY FOR ECONOMIC SERVICES (in Cantonese): Mr President, the Dogs and Cats Regulations provide that no one may keep a dog over the age of five months without a licence issued by the Director of Agriculture and Fisheries. Any person contravening this requirement is liable to a fine of $5,000 and to imprisonment for six months. An unlicensed dog is liable to seizure by the Director of Agriculture and Fisheries. Dog licences are issued free of charge as an incentive to compliance with the licensing requirement.
Although no dog licence may be issued unless the dog is tattooed as evidence of inoculation against rabies, there is currently no requirement for dogs to carry information identifying their owner. Later this year, however, we intend to introduce a requirement for all dogs to be implanted with a small microchip containing ownership data. This will strengthen considerably our ability to identify owners who allow their dogs to stray.
As regards the second part of the question, the Dogs and Cats Regulations provide that no dog may be allowed out on a public thoroughfare unless it is on the lead or otherwise under control. Any person contravening this requirement is liable to a fine of $5,000 and to imprisonment for six months. Moreover, under the Summary Offences Ordinance, there are penalties of a fine of $500 or imprisonment for three months for any person who keeps a dog which persistently annoys or menaces neighbours or passers-by or who allows an unmuzzled ferocious dog to go at large, or urges any dog to attack or worry any person.
Mr President, I believe that existing legislation sets out clearly the responsibilities of dog owners in regard to control of their animals in public places and that the introduction of a requirement for compulsory use of muzzles on all dogs is not warranted.
MR FREDERICK FUNG (in Cantonese): Mr President, I would like to raise a follow-up question. Since a girl was bitten to death by a dog last month in Sheung Shui, there have been a number of press reports about people being bitten by dogs. One can easily find a lot of stray dogs running around in public
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housing estates, and they scare elderly people. I would like to ask the Secretary whether any attempts had been made in the past few years to implement the three requirements he mentioned? If yes, how many successful prosecution cases were brought against dog owners? If not, why not?
SECRETARY FOR ECONOMIC SERVICES (in Cantonese): Mr President, there are about 140 000 licensed dogs in Hong Kong. Every year the Agriculture and Fisheries Department sends its staff around to catch stray dogs. In 1993, 18 000 stray dogs were caught. As far as prosecution is concerned, 249 dog owners were prosecuted for keeping unlicenced dogs, and during the year there were 503 cases of dogs not under proper control.
MR VINCENT CHENG (in Cantonese): Mr President, will the Secretary advise whether dog owners are responsible for the medical expenses of the victims bitten by dogs and other damage incurred?
PRESIDENT: This is straying beyond the answer. But are you able to elucidate, Secretary?
SECRETARY FOR ECONOMIC SERVICES (in Cantonese): Mr President, as far as I know, there is no statutory requirement on this. But the Attorney General may agree with me that the victims naturally have a right in law to get damages.
PRESIDENT: I think we had better move on to something more specific. Miss Christine LOH.
MISS CHRISTINE LOH: Mr President, could the Secretary elaborate on exactly how he intends to introduce a requirement for all dogs to be implanted with a small microchip containing ownership data and whether he expects this legislature to pass laws to that effect?
SECRETARY FOR ECONOMIC SERVICES: Mr President, the present law provides for the Director of Agriculture and Fisheries to make markings on dogs that have been through a vaccination process. Normally it is done to the ear and the markings will indicate the month and the year when that particular dog was injected with the vaccine. The same process will be done with the microchip. Instead of stabbing the ear, the intention is to plant that microchip with the data of the month, the year and the details of the owner into the soft skin of the dog.
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MR RONALD ARCULLI: Mr President, would the Secretary confirm that the microchip technology is quite safe for dogs and whether in fact the cost of introduction of this sort of rather modern technology is really a mere $250,000 which the Administration has been prevaricating over for the last few years?
SECRETARY FOR ECONOMIC SERVICES: First, Mr President, I would like to confirm that the implanting of microchip is now being done in quite a number of countries and is standard technology these days.
Secondly, I am afraid, Mr President, I am not sure about the amount that the Member has referred to. But the Director of Agriculture and Fisheries has informed me that he has both the means and the resources to go through with the implanting of the chip.
DR LEONG CHE-HUNG: Mr President, will the Administration inform this Council whether there are prescribed criteria to be fulfilled, other than inoculation against rabies, before a dog is licensed? In particular, is a certificate of health needed from a certified vet? If not, will the Administration introduce such measures for the purpose of public health?
SECRETARY FOR ECONOMIC SERVICES: Mr President, in fact there are at present no requirements for the provision of — for lack of a better term — medical certificates for dogs. But the vaccination is of course done by a vet and the vet would be able to see the condition of the animal which receives the actual injection and which goes through the implantation of the chip. Therefore, the vet would be in a position to advise owners about possible problems associated with the health of the animal.
MRS ELSIE TU: Mr President, since most dangerous dogs are stray dogs, wild dogs or dogs that have not been registered and they are not born in hospitals to get birth certificates, how is the Government going to deal with these stray dogs, wild dogs and unregistered dogs? It seems that the dangerous ones will still be left loose. Is that not so?
SECRETARY FOR ECONOMIC SERVICES: Mr President, as I said, last year we caught nearly 18 000 stray dogs. The Director of Agriculture and Fisheries actually makes it his task to send a dog catching team around when there are reports of stray dogs and also to send the team on routine patrol. I think the responsibility must rest with owners. Some stray dogs come about as a result of owners having bred them, not taking care of them and letting them run around in the streets. So it is the task of the Director to set his staff to go after stray dogs and to have owners go through registration and control.
2036 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
MRS PEGGY LAM (in Cantonese): Mr President, the Secretary says in the third paragraph of his reply that "no dog may be allowed out on a public thoroughfare unless it is on the lead or otherwise under control". Is the Administration aware of the fact that a lot of street sleepers and vigrants keep dogs and that these dogs are licensed? Are dog owners required to fill in their address when they apply for a licence? If so, how can the Administration issue licences to these vigrants who have no address? Furthermore, if it is not necessary to give an address, then how can the Administration enforce the law that provides that no dog may be allowed out on a public thoroughfare? Are they self contradictory?
SECRETARY FOR ECONOMIC SERVICES (in Cantonese): Mr President, I have to go back and check if the address has to be filled in. Even if there is an address column in the form, a vagrant can put in any street name or door number, and the authority has no way to confirm the address or verify whether he lives at that address. The important thing is that the law stipulates that it is the "responsibility" of dog owners to control their dogs. Therefore no matter where dog owners live, they must observe the law if they take their dogs out in public places.
MR JAMES TO (in Cantonese): Mr President, in the past it was common for smuggling syndicates to send their men out to see if there were duty officers from the Anti-Smuggling Task Force monitoring their activities. Now they send what they call "lookouts", which means ferocious dogs led by men to keep watch over police activities, and they will order the dogs to attack the police when necessary. Just now the Secretary has said in the third paragraph of his reply that the maximum penalty is three months' imprisonment for any person who urges a dog to attack others. Will the Secretary advise whether a review will be conducted to see if the penalty imposed under the existing law for this offence is more lenient than that imposed for, for example, assault cases?
SECRETARY FOR ECONOMIC SERVICES (in Cantonese): Mr President, I will discuss with the Customs and Excise Department and the Police Force, the two enforcement bodies, to see if the law has to be amended in the light of the circumstances referred to by Mr TO.
Written answers to questions
Vietnamese migrants
7. MR MARTIN BARROW asked: As the number of Vietnamese migrants stranded in Hong Kong has fallen from a peak of 64 000 to under 32 000 as at 1 January 1994, will the Government inform this Council:
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2037
(a) how the remaining migrants will be housed and which detention centres will be closed in 1994; and
(b) what use will be made of facilities closed in 1994 or 1995?
SECRETARY FOR SECURITY: Mr President, there are now some 27 500 Vietnamese migrants in Hong Kong. The great majority are accommodated in three detention centres: those from the south of Vietnam in the Tai A Chau and High Island Detention Centres, and those from the north of Vietnam in Whitehead. Depending on the pace of repatriation, we hope to be able to close some sections of Whitehead, and one of the centres for the southern Vietnamese towards the end of this year. The timing of the closure of the remaining centres will probably coincide with the repatriation of the last remaining Vietnamese migrants in the territory. If present arrival and departure trends are maintained, this should be achieved in early 1996.
No alternative use has yet been decided for the detention centres which may be closed in the next two years.
MTRC service improvement programme
8. MR STEVEN POON asked (in Chinese): The Mass Transit Railway Corporation (MTRC) announced that it would spend $8 billion to improve its services over the next seven years and the cost would be borne by its revenue from passenger fares. Will the Government inform this Council:
(a) whether the MTRC has submitted a detailed financial plan for the perusal of the Government and whether the Government has agreed to the proposed improvement programme;
(b) whether consideration has been given to requesting the MTRC to spend this huge sum of money on the construction of the Airport Railway instead so that the borrowing ratio of the Airport Railway may be reduced;
(c) whether the spending of $8 billion on the proposed programme by the MTRC will subsequently reduce the amount of funds available for the construction of the Airport Railway; and
(d) if the cost of $8 billion is to be borne by passengers, how the MTRC would increase its fares, for how many years the MTR passengers would be subject to such fare increases and what the extent of the fare increase will be?
2038 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 SECRETARY FOR TRANSPORT: Mr President,
(a) The corporation is not required under its Ordinance (Cap 270) to seek financial approval from the Government for its annual budget or financial plans. Although the preparation and approval of these documents are matters for the corporation and its board, the corporation does submit its annual budget and long-term financial forecast to the Government for perusal. The proposed $8 billion improvement programme for the existing railway system has been included in these documents and approved by the board.
(b) and (c)
The Airport Railway and the improvement programme for the existing MTR system are two entirely separate projects. One does not affect or preclude the other and there is no reason to link the financing of these projects.
The Airport Railway will be financed through injection of equity by the Government, borrowing by the corporation and profits from Airport Railway related property developments.
The expenditure of $8 billion on the improvement programme has been fully allowed for in the corporation's financial plans for the existing MTR system. $6 billion of the $8 billion required for the improvement programme can be met by depreciation charges made over the years, with the remaining $2 billion to be funded by internal reserves and borrowings. This will not affect the corporation's ability to raise funds for the Airport Railway.
(d) It is essential for the corporation to maintain and improve its existing system so that people can continue to enjoy a safe, fast, reliable and efficient railway service. Even with this maintenance and improvement programme, the corporation expects that annual fare adjustments can continue to be in line with inflation.
External trade statistics under-reporting
9. MR ROGER LUK asked: In view of the active smuggling activities between Hong Kong and nearby territories in recent years, will the Administration advise this Council of the extent of under-reporting in external trade statistics arising from undeclared export and re-exports from Hong Kong?
SECRETARY FOR FINANCIAL SERVICES: Mr President, Hong Kong's external trade statistics are compiled on the basis of information reported on import/export declarations which are matched against cargo manifests to ensure
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2039
the complete coverage of goods imported and exported. Goods reported on manifests but undeclared will be identified and eventually captured in the trade statistics system.
Because smuggled goods are non-manifested, they do not appear in the trade statistics and it is not possible to estimate accurately the value of goods smuggled.
In general, all trade statistics are as accurate as they reasonably can be and every effort is made by the Administration to ensure that the accuracy is not only maintained but also improved.
Harbour management
10. MR ALBERT CHAN asked (in Chinese): Will the Government inform this Council: (a) of the number of marine accidents in 1993; and
(b) whether there are plans to review the establishment of the Marine Department and to update the monitoring equipment in order to strengthen harbour management?
SECRETARY FOR ECONOMIC SERVICES: Mr President, in 1993, there were 368 maritime accidents involving vessels ranging from large ocean-going ships to small motor sampans. These accidents include collisions, groundings and capsizes of vessels. About 70% were minor in nature with no casualties.
The Marine Department constantly reviews its operational procedures, equipment and establishment to ensure that they remain sufficient and up to date in maintaining maximum safety and efficient management of the waters of Hong Kong.
To this end, the Director of Marine has obtained funding to implement the following plans, between now and 1996 to further strengthen harbour management:
(a) the establishment of a local marine traffic control station at Ma Wan in 1995. This includes 26 new posts, a dedicated launch, radar and other communications equipment;
(b) the establishment of a radar station at Kau Yi Chau to enhance radar surveillance of the Western Harbour and provide full radar coverage of Kwai Chung and approaches;
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(c) the purchase of three quick reaction patrol vessels. These vessels will come into service in mid-1994; and
(d) the replacement of five obsolete and cost ineffective patrol vessels by mid 1996. In addition, the following plans are under consideration:
(a) the phasing out and replacement of a further 11 local patrol craft; (b) the extension of patrol capability in the principal fairways and anchorages; and
(c) the establishment of further local traffic control stations at the new port developments of Container Terminals No. 9 and No. 10.
HAN Dongfang incident
11. DR CONRAD LAM asked (in Chinese): Regarding the case of HAN Dong-fang, will the Government inform this Council:
(a) whether the Chinese Government has obtained the formal consent of the British or Hong Kong Government before its expulsion of HAN Dong-fang into the territory of Hong Kong, whereupon the Hong Kong Government would be able to act in accordance with international law to accept HAN Dong-fang legally into Hong Kong;
(b) if not, whether the Chinese Government has, in terms of international law encroached upon Britain's sovereignty in Hong Kong and whether the Hong Kong or British Government would take this issue up with the Chinese Government?
SECRETARY FOR SECURITY: Mr President,
(a) No.
(b) No. There was no question of an encroachment of Britain's sovereignty in Hong Kong. We have already made our views on this episode clear to the Chinese authorities.
Medical fees and charges increases
12. MISS EMILY LAU asked: Regarding the Government's decision to substantially increase medical services fees and charges from 1 February 1994,
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particularly for hospital public wards (25.6% increase) and general out-patient clinics (38% increase), will the Administration inform this Council:
(a) why the increases are way above the annual rate of inflation;
(b) whether the increases will fuel inflation; and
(c) why the percentage of government subsidy for different services varies from as high as 76% to 97%?
SECRETARY FOR HEALTH AND WELFARE: Mr President, the fees and charges for public medical services are revised annually to reflect rising costs. It is a general phenomenon that medical inflation tends to exceed general inflation due to advancements in technology, use of new treatment modalities and the need to meet rising public expectations. Historically, the daily charge for hospital general wards was set at a level to reflect the catering costs whilst the fees charged by public out-patient clinics have always been based on operating cost.
This year, the fee revision for general clinics from $21 to $29 has taken into account a price change of 11% over the previous year and the following one-off factors:
(a) adoption of a comprehensive new costing system covering all clinics operated by the Department of Health; and
(b) initial reduction in throughput caused by the introduction of unit medical record system in 15 clinics to enhance patient care.
The effect on inflation of the proposed fee revision in 1993-94 is estimated by the Government Economist to be a minimal of 0.0217%.
Fees charged for medical services had their origins in the post-war years when they were set at nominal levels. These fees are adjusted annually. The current level of subsidy for hospital beds at 97% and for general out-patient clinics at 81% are thus a legacy of the past.
Sheltered workshops for the disabled
13. MR CHEUNG MAN-KWONG asked (in Chinese): With regard to the placement of the disabled in government sheltered workshops, will the Government inform this Council:
(a) of the average monthly income of these people and the ways of calculating their wages;
2042 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
(b) of the sources of orders placed with the workshops and the percentage of government orders; the channels through which the orders are obtained; and the major products required by these orders; and
(c) whether the present operation, mode of production and quality of products of the sheltered workshops will be reviewed and whether measures, such as tapping more sources of orders, will be taken to enhance the job opportunities of the disabled?
SECRETARY FOR HEALTH AND WELFARE: Mr President, my answer in seriatim is as follows.
As regards part (a) of the question, the monthly income of workers in government run and subvented sheltered workshops ranges from $500 to $1,800, with a monthly average of $700 per person. These amounts include an incentive payment of $14 per day payable to those turning up for work.
Sheltered workers' wages are on the whole calculated on the basis of piece rate set by job suppliers. Where the work production comprises several work processes, with varying degrees of complexity performed by different workers, this factor of complexity will be taken into account in the apportionment of the "piece rate" in calculating the wages.
As regards part (b) of the question, over 500 different sources of job orders were acquired by sheltered workshops in 1993. About 95% of these job orders were from the commercial and industrial sectors, with the balance from the Government. Job orders are obtained either by workshop staff who directly approach potential job order suppliers by paying visits, making telephone calls or mailing advertisement letters to them, or through referral by other job order suppliers, sheltered workshops, government departments and welfare agencies.
Job orders obtained by sheltered workshops are mostly in the form of simple processing, finishing, assembling or sub-assembling work which sheltered workshop workers are able to undertake. Major products placed by these orders include assembling light industrial products, toys, family consumable and stationery; packaging eating utensil sets for fast food restaurants and airline companies, toiletries for hotels, gift sets for supermarkets and retail shops; processing mailing packets (such as inserting documents in envelopes, sealing, pasting address labels, mailing), sewing, printing and book-binding.
As regards part (c) of the question, a review of the sheltered workshop system is being planned. The review will address issues involved in the operation and management of sheltered workshops. The aim is to make sheltered workshops more commercially oriented, to improve vocational skills of sheltered workers and to enhance their open employment opportunities.
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2043 Air quality in traffic interchanges
14. MR FRED LI asked (in Chinese): According to the report of a survey recently conducted by the Environmental Protection Department (EPD), the air quality in five traffic interchanges in the territory falls below the acceptable standard, and the situation at the Kwun Tong-Lam Tin Interchange is even worse, with very serious noise problems in addition to air pollution. In the light of such findings, will the Government inform this Council:
(a) whether the EPD had carried out environmental impact assessments at the planning stage of the Lam Tin Interchange project; if so, why such serious problems have arisen shortly after the opening of the interchange to traffic; and
(b) of the short-term as well as long-term remedial measures to be taken by the EPD to improve the air quality and to reduce the noise pollution at the interchange?
SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President,
(a) The Lam Tin Transport Interchange is part of the Sceneway Garden Development. An environmental impact assessment (EIA) on the Development and a separate environmental assessment study on the interchange were carried out in 1988 at the planning stage. The EIA for the Sceneway Garden Development confirmed the need for a podium deck straddling Lei Yue Mun Road to protect Sceneway Garden residents from traffic noise and this has achieved the desired effect. The EIA also indicated that a properly designed ventilating system would be needed to meet air quality requirements.
Noise levels at the interchange, although high, are similar to those at other roadside locations near busy roads. Given that the period of exposure for waiting passengers is relatively short, the levels are considered tolerable.
However, even though passengers are exposed to air pollution for short periods only, the air quality is unacceptable. This is mainly because the ventilation is inadequate or ineffective.
(b) In the short term, improvements to air quality at this and similar facilities will be sought by the government departments responsible for the public facilities and the management companies responsible for private facilities through better operation and maintenance of the ventilation systems. The Environmental Protection Department (EPD) is consulting those concerned on the feasibility of increasing the effectiveness of existing exhaust fans. To reduce unnecessary
2044 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
emissions bus drivers have also been asked to turn off their engines while waiting at these facilities.
In the long term, the ventilation systems, including ventilating fans, fresh air intakes and exhaust air ducts, may need to be upgraded to achieve acceptable air quality standards. The EPD is devising air quality standards for road tunnels and transport interchanges and has also commissioned a study to formulate the design and operational requirements for ventilation systems in such facilities. The study is expected to be completed by May 1994.
Bus interchanges
15. MR TIK CHI-YUEN asked (in Chinese): In view of the favourable response to the provision of a bus interchange at the Shing Mun Tunnel, will the Government inform this Council whether consideration will be given to introducing similar facilities at other toll tunnels?
SECRETARY FOR TRANSPORT: Mr President, the bus interchange at the Tsuen Wan end of the Shing Mun Tunnels has indeed proven to be a success. It has been welcomed by passengers because they can transfer to different routes at a bargain fare. It also benefits the bus company concerned because if facilitates the same level of service to passengers through the rationalization of bus routes.
The successful working of a bus interchange at a tunnel depends on a number of factors, namely:
(a) an adequate area at the tunnel entrance for the provision of proper lay-by and the necessary waiting areas and passenger shelters;
(b) a sufficient number of bus routes with different origins and destinations passing through the tunnel;
(c) no free pedestrian access to the interchange to prevent "free riders"; and
(d) a single bus operator otherwise there would be difficulties over the apportionment of fares.
Unfortunately, it is not possible or practical to provide bus interchanges at other tunnel locations because these basic criteria cannot be met.
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2045 River trade terminal project
16. DR TANG SIU-TONG asked (in Chinese): In view of the deferral of the river trade terminal project on the eastern side of Tap Shek Kok Power Station in Castle Peak, Tuen Mun, will the Government inform this Council:
(a) of the up-to-date progress of the aforementioned project;
(b) when the project is expected to complete; and
(c) whether there will be any appropriate transport measures to facilitate the operation of this proposed terminal?
SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President,
(a) The river trade terminal project (RTT) has not been deferred. The Government received several expressions of interest in the project and two submissions in response to its invitation. The submissions and various technical issues involved are being evaluated with a view to reaching decisions on the timing of the project and the means of implementation.
(b) Present indications are that, ideally, the first phase of the RTT should be operational by the latter part of 1997 if possible.
(c) Improvements to the local road network to cope with additional traffic will be required. They include the widening of Lung Mun Road and the construction of a bypass along the foothills of Castle Peak. Implementation should have regard to the phasing of the RTT development.
Manpower resources engaged in industrial research and development 17. DR HUANG CHEN-YA asked (in Chinese): Will the Government inform this Council:
(a) of the manpower resources engaged in research and development of the industries in Hong Kong;
(b) how such figures compare with those of our neighbouring countries; and (c) what plan is in hand to increase the manpower supply in this field?
2046 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
SECRETARY FOR TRADE AND INDUSTRY: Mr President, the Government does not required private sector companies to supply statistics on the functional breakdown of employees, and therefore cannot supply the information requested in (a). The information requested in (b) is not available to the Government. Insofar as (c) is concerned, the Government has sought to increase the supply of trained personnel who would be qualified to undertake industrial research and development work. Thus, the number of post-graduates in scientific and engineering disciplines from local tertiary institutions increased from 196 in 1989 to 395 in 1993, and is projected to rise to 973 in 1997. The number of graduates in scientific and engineering disciplines increased from 2 128 in 1989 to 3 087 in 1993, and is projected to rise to 7 465 by 1997. The increase in human resources is only one of the means used by the Government to facilitate research and development work by Hong Kong's manufacturing industries.
ICAC programme to establish tighter links with the private sector
18. MR HENRY TANG asked: In his policy address on 6 October 1993, the Governor said that 30 officers in the Independent Commission Against Corruption will be redeployed to form a special working group to establish tighter links with the private sector. Will the Government inform this Council of details of the programme and the progress made so far?
CHIEF SECRETARY: Mr President, a special team of 30 ICAC community relations officers was established in the Independent Commission Against Corruption (ICAC) in November 1993. The team has made initial progress on several fronts.
First, in conjunction with six major chambers of commerce, the team is actively preparing for a Conference on Business Ethics, the first of its kind in Hong Kong. This conference is tentatively scheduled for May 1994. It aims to generate support from business leaders and to formulate a set of guidelines on corporate codes of conduct for reference by the business community at large. The six co-organizing chambers are the Hong Kong General Chamber of Commerce, Chinese Manufacturers' Association of Hong Kong, Chinese General Chamber of Commerce, Federation of Hong Kong Industries, Hong Kong Chinese Enterprises Association and America Chamber of Commerce in Hong Kong. Invitations to attend the conference will soon be issued to the heads of over 300 organizations including trade associations, listed companies, large private companies, professional bodies and the trade departments of consulates.
The special team has also begun to approach companies listed on the Stock Exchange and trade associations to help them design individual codes of conduct, on a voluntary basis. The response has so far been encouraging. The team aims to have approached all 480 listed companies by the end of this year. Thereafter, it will extend its service to 2 000 large private companies and all tertiary academic institutions in Hong Kong.
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2047
In addition, earlier this month the ICAC completed field work on two surveys, targetted separately at senior business executives and the general public, to obtain a more in-depth understanding of their perceptions and views on business ethics in Hong Kong. The findings will be available in March. They will help the special team develop more long-term services for the business community.
Nursing Board education advisor
19. MR MICHAEL HO asked (in Chinese): According to the Nurses Registration Ordinance, the Nursing Board shall have an education adviser nominated by the Director of Education and appointed by the Governor. Yet his position has long remained vacant. Will the Government inform this Council:
(a) of the purpose of providing an education adviser;
(b) of the reasons why the position has remained vacant for so long; and (c) when a suitable person will next be appointed to fill the vacancy?
SECRETARY FOR HEALTH AND WELFARE: Mr President, the role of the education advisor appointed under section 3(6)(b) of the Nurses Registration Ordinance (Cap 164) is to give advice to the Nursing Board, when necessary, on educational qualifications for nurses trainees and teaching techniques for nurses training. He is not a member of Nursing Board constituted under section 3(2) of the Ordinance.
Since 1982, the Nursing Board has not requested the service of the education advisor. The position has therefore been left vacant following the retirement of the last education advisor in October 1984.
The Nursing Board is currently reviewing its composition. If necessary, a new education advisor will be appointed.
Assault on Hong Kong container truck drivers
20. MR JAMES TIEN asked (in Chinese): In view of the recent assault on Hong Kong container truck drivers by some soldiers of the Chinese People's Liberation Army, giving rise to strong discontent among members of the Hong Kong transport industry and hence their intention to organize a mass drive slow in protest, will the Government inform this Council:
(a) how it handles this incident of assault; and
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(b) given the busy land freight transport between China and Hong Kong, what measures it will take, in cooperation with the Chinese authorities concerned to avoid any recurrence, so as to further safeguard members of the local freight industry who have to commute between China and Hong Kong, and to avoid any unnecessary damage to the China-Hong Kong freight industry arising from such incidents?
SECRETARY FOR TRANSPORT: Mr President,
(a) The Hong Kong and Shenzhen authorities have established border liaison channels which can be activated very quickly to deal with issues or incidents such as that which occurred on 2 January involving Hong Kong container truck drivers. On that occasion, such a forum facilitated discussions between the drivers' representatives and the Shenzhen authorities, which resulted in the planned slow drive protest being cancelled. Investigation of this particular incident is a matter for the Chinese authorities since it happened in Shenzhen.
(b) Smooth cross-border traffic is vital to economic well-being on both sides of the border. We will continue to liaise with the Shenzhen authorities through the border liaison machinery to try to avoid similar incidents occurring in the future. If problems do arise on the Hong Kong side then, as in the past, the government departments concerned will confer and mediate with the freight industry and drivers' representatives with a view to solving such problems in the quickest and most practical manner possible.
Motion
BUSINESS REGISTRATION ORDINANCE
THE SECRETARY FOR THE TREASURY moved the following motion:
"That with effect from 1 March 1994 the Schedule to the Business Registration Ordinance be amended:
(a) in item 4(a) by repealing "$60" and substituting "$66";
(b) in item 4(b) by repealing "$150" and substituting "$165";
(c) in item 5 by repealing "$60" and substituting "$66".
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He said: Mr President, the Schedule to the Business Registration Ordinance (Cap 310) specifies various fees and penalties payable under the Ordinance. This Council last revised the registration fee in respect of a branch of business in March 1993. I now propose to revise it from $60 to $66, in line with the increases in costs.
I also propose to increase the penalties for non-payment of business registration fees and branch registration fees. These penalties were last revised last year. To preserve the deterrent effect, I propose to increase the penalty for not paying the business registration fee from $150 to $165, and the penalty for the non-payment of the branch registration fee from $60 to $66.
These increases, if approved, will take effect on 1 March 1994. I estimate that they will bring in additional revenue of more than $1 million a year.
I thus move the resolution standing in my name in the Order Paper.
Question on the motion proposed.
MR JAMES TO (in Cantonese): Mr President, although I do not have any strong views on the fee increase this time, I have some views to share with the Secretary for the Treasury, which I hope would be taken into consideration by the Government in the future.
First, regarding the penalties for non-payment of business registration fee and non payment of branch registration fee which will be increased to $165 and $66 respectively, at present, the business registration fee is $1,000-odd, and the penalty for non-payment is $165. However, the branch registration fee is now increased to $66 only and the penalty for non-payment is also $66, that is 100%. In such circumstances, is the new penalty of $165 not commensurate with the $1,000-odd business registration fee unpaid by the head office?
Second, I am a little doubtful about the preservation of deterrent effect as claimed by the Secretary just now. If the penalties are merely $100-odd and $60-odd respectively, will there be any actual deterrent effect? If the Government really wants to have such effect, I urge the Secretary to consider raising the rate of increase to a more realistic level next time when he reviews the penalties because I do not believe that the existing form of penalty or the amount of fine can really have any deterrent effect.
PRESIDENT: Secretary, do you wish to reply?
SECRETARY FOR THE TREASURY: Mr President, our policy on revision of fees of this kind is to set the fee at a level sufficient to recover the administrative costs involved. It is arguable whether such a policy should apply
2050 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
equally to the setting of penalties. I have heard what Mr James TO has said and am happy to consider his suggestion in the context of the next review.
Question on the motion put and agreed to.
First Reading of Bills
PUBLIC BUS SERVICES (AMENDMENT) BILL 1994
SECURITIES (INSIDER DEALING) (AMENDMENT) BILL 1994 THE HONG KONG INSTITUTE OF EDUCATION BILL
Bills read the First time and ordered to be set down for Second Reading pursuant to Standing Order 41(3).
Second Reading of Bills
PUBLIC BUS SERVICES (AMENDMENT) BILL 1994
THE SECRETARY FOR TRANSPORT moved the Second Reading of: "A Bill to amend the Public Bus Services Ordinance."
He said: Mr President, I move the Second Reading of the Public Bus Services (Amendment) Bill 1994.
There is constant public pressure to improve the quality of bus services. When encouragement and warnings to the bus companies fail to achieve the desired results, the imposition of financial penalties becomes necessary. The main thrust of the amending Bill is to provide legislative teeth to penalize the bus companies for non-performance.
Clause 2 of the Bill seeks to change the manner in which fines can be levied. The impact will become much greater since, apart from retaining the existing graduated scale of fines of $10,000 for deficiencies on the first occasion, $20,000 on the second and $50,000 on the third and subsequent occasions, this will be multiplied by the number of routes on which deficiencies are found. Penalties will remain on record for a five-year period from the date of the imposition so as to determine what the level of fines for future offences should be.
Clause 3 seeks to exclude the financial penalties from being deemed as part of the operating expenses of a bus operator. This is essential to ensure that the operator does not pass on such penalties to bus passengers in the form of higher fares.
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2051
The opportunity is taken in this Bill to delegate the powers to make regulations pertaining to bus operations, for example, the designation of bus stops and the conduct of bus drivers, from the Governor in Council to the Secretary for Transport. Clause 4 provides for this.
Clause 5 simply adds a new section to enable the existing regulations to remain in force.
Mr President, the Legislative Council Transport Panel has been consulted on the approach now advocated and I gratefully acknowledge the full support that Members have given.
Bill referred to the House Committee pursuant to Standing Order 42(3A).
SECURITIES (INSIDER DEALING) (AMENDMENT) BILL 1994
THE SECRETARY FOR FINANCIAL SERVICES moved the Second Reading of: "A Bill to amend the Securities (Insider Dealing) Ordinance."
He said: Mr President, I move the Second Reading of the Securities (Insider Dealing) (Amendment) Bill 1994. The Bill seeks to eliminate an existing loophole under which insider dealing can be conducted through the trading of third-party-issued derivative products without being caught by the relevant legislation.
The Securities (Insider Dealing) Ordinance stipulates measures to penalize the dealing in listed securities on the basis of non-public price-sensitive information relating to a single listed company. The current definition of "listed securities" in effect limits the scope of the Ordinance to such things as shares, stocks, debentures of a listed corporation and certain derivative products issued by that corporation. Instruments covered by the Ordinance have to be listed on the Stock Exchange of Hong Kong Limited.
In recent years, we have seen an increasing number of derivative products in respect of locally listed securities. Many of these products are issued by a party unrelated to the corporation whose shares form the underlying securities. Some of the products are not listed on the Stock Exchange in Hong Kong. Examples of these products include derivative warrants, stock options now being planned by the Stock Exchange and American Depositary Receipts. Since these instruments are issued by a third party, they are not classified as the securities of the relevant listed corporation and thus their trading falls outside the scope of "insider dealing". The same applies where the products are not listed in Hong Kong.
The Bill being introduced amends the Ordinance so that insider dealing will cover third-party-issued derivative products in respect of listed securities in Hong Kong, whether or not these products are listed here. It involves some
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technical amendments to the Ordinance which are necessary to ensure that the burgeoning derivative markets are not used to circumvent the regulatory framework. It will also help to ensure the success of the market for stock options which the Stock Exchange intends to introduce later this year, because investors in this market will know that insider dealing legislation comparable with international standards is in place.
Bill referred to the House Committee pursuant to Standing Order 42(3A).
THE HONG KONG INSTITUTE OF EDUCATION BILL
THE SECRETARY FOR EDUCATION AND MANPOWER moved the Second Reading of: "A Bill to establish The Hong Kong Institute of Education as a body corporate to provide teacher education and facilities for research into and the development of education, and to provide for related matters."
He said: Mr President, I move the Second Reading of the Hong Kong Institute of Education Bill.
The Bill seeks to incorporate the Hong Kong Institute of Education as an autonomous tertiary institution. The establishment of the Institute follows the recommendation in Education Commission Report No. 5. The aim is to upgrade the quality of teacher education and continuous professional development of teachers in Hong Kong. The new unitary institution will subsume the four existing Colleges of Education and the Institute of Language in Education, which are currently managed by the Education Department.
The Bill sets out the functions, powers and organization of the institute. It provides for a council to be appointed by the Governor in his capacity as the president of the institute. The council will comprise the director and deputy directors of the institute, public officers, nominees from the Academic Board, a staff representative, members of the public with experience in commerce, industry or a profession in Hong Kong, and others who are experienced in higher education in Hong Kong or elsewhere.
The Bill also provides for the appointment of an academic board to plan academic programmes, regulate student admission and confer academic awards.
As a subvented organization, the institute will be required to submit its annual estimates for government approval, to table its financial report to the Legislative Council and to subject its accounts to the scrutiny of the Director of Audit. The Bill makes provision for these.
Since its appointment in January 1993, the Provisional Governing Council of the Hong Kong Institute of Education has been making good progress. It has appointed the director for the institute and is recruiting other key administrative and academic staff. It is planning the development of a new campus in Tai Po
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2053
and is engaged in working out arrangements for integrating qualified serving staff into the new Institute. It is also on track to offering its own academic programmes by September 1994. It is therefore now timely to enact legislation to incorporate the Institute.
Bill referred to the House Committee pursuant to Standing Order 42(3A).
ADMINISTRATIVE APPEALS BOARD BILL
Resumption of debate on Second Reading which was moved on 31 March 1993 Question on Second Reading proposed.
MR ANDREW WONG: Mr President, the Bill in question seeks to establish an Administrative Appeals Board (AAB) as the authority to hear and determine appeals against administrative decisions. The intention behind the Bill is manifold. Among them is efficiency through relieving the Executive Council of the responsibility of determining statutory appeals against administrative decisions which are of a relatively minor nature. The key intention will, I am sure, become apparent when we examine the provisions of this new Bill.
A Bills Committee, of which I am the Chairman, was set up to study the Bill. Four meetings had been held and the Administration had participated in all of them.
The Bills Committee deliberated in great detail mainly on five areas, namely, first, the power of the Secretary to the AAB in the appointment of persons from the panel to serve as members of the board and the appointment of any deputy chairman to act as chairman during the latter's absence; two, the right of all parties to the appeal to claim privileges in respect of disclosure of information; three, AAB's power to award or recommend ex gratia payments to the appellant; fourth, provision for appeals against the board's award of costs, and finally, fifth, a right of further appeal on a point of law in addition to the possibility of judicial review.
Let me, Mr President, briefly go into these areas. The FIRST one concerns the power of the Secretary to the AAB. Clause 5(3)(b) empowers the Secretary to the AAB to appoint two persons from the panel to serve as members of the board for a particular appeal case. Members of the Bills Committee are of the view that the power given to the Secretary is too wide and that it should be subject to some kind of control. The Administration has accepted Members' view and I will, during Committee stage, move an amendment to add a new provision to clause 7 of the Bill to the effect that the Secretary, in the exercise of any power conferred on him under the Bill, will be required to act subject to any directions given by the Chairman and not himself.
2054 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
Under clause 8(1), the Secretary may appoint any deputy chairman to act as chairman during the period when the Chairman is precluded by illness, absence from Hong Kong or any other cause from exercising him functions. Again, Members of the Committee are of the view that the power of appointment should not be vested with the Secretary. It was suggested that either the power be vested in the Governor or that a list be compiled, on the basis of seniority of the various deputy chairmen, so that a more definite means of appointment of a deputy chairman to act as the acting chairman could be established. The Administration is of the view that since the acting chairman shall perform all the statutory powers vested in the chairman and as the chairman is to be appointed by the Governor, the Governor should be given the power to appoint the acting chairman. The said clause will be appropriately amended during Committee stage.
The SECOND area where amendment to the Bill is necessary concerns the right to claim privileges. Under clause 14(1) of the Bill, only the respondent (that is, the government department or the public agency) is entitled to claim privileges in respect of disclosure of information as if the proceedings before the AAB were proceedings before a court of law. Given that the other parties to the appeal (that is, the victim himself or herself and any other person who is bound by the decision appealed against) may also be compelled to disclose information under clauses 12 and 13 of the Bill, in the interest of justice clause 14 should be amended so that the right to claim privileges is extended to cover all the parties to the appeal. An amendment will be moved during Committee stage to the effect.
The THIRD area which Members have examined in detail is the vesting of power to the AAB to award or recommend ex gratia payments to the successful appellant against any administrative decision, where damage has been suffered by the appellant as a result of the wrongdoing on the part of the Administration. The Administration however is of the view that the AAB, in considering an appeal against any administrative decision, is confined to confirming, varying or reversing such decision. The award of ex gratia compensation is highly technical, and the board may not be in a position to assess the damages. Moreover, the Administration considers that the extent of any economic loss suffered by an aggrieved party is likely to be greatly mitigated by clause 21(1)(k) which empowers the Board to make an award as to costs, and clause 4(3)(e)(iv) which enables an Ordinance be amended to provide for the suspension of an administrative decision pending appeal. In the unlikely event where, notwithstanding the provisions in the above clauses, a person has suffered substantial loss by virtue of any wrongdoing connected with an administrative decision, the appropriate remedy in respect of compensation should lie in civil action instead.
The Administration is also of the view that it would not be appropriate for the AAB to award or recommend ex gratia payment on grounds that any recommendation on public expenditure must come from the executive branch of government and be approved by the legislature. The board is also not intended
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2055
to be a body established to make recommendations which would have financial implications. Moreover, the Administration is also concerned that if the board is empowered to award or recommend ex gratia payment, it might encourage appellants to go to the board for the wrong reason and to delay matters further.
I and other Members of the Committee then asked the Administration to consider whether the board could be empowered to refer a case to an appropriate authority to consider whether recommendation for ex gratia payment should be made. Having considered the request carefully, the Administration agreed to give the board a referral power under clause 21 and agreed that an amendment should be made to this clause by adding a new subclause which specifies clearly that the board may order the case in question to be referred back to the respondent, to the government department or public agency for consideration of any such matters as the board may order. Members are satisfied that the proposed wording of the subclause is broad enough to cover situations where the board can refer a case back to the original decision making body to consider the award of ex gratia payments. I will move the amendment during Committee stage.
The FOURTH area of Members' concern is whether there should be a provision for appeals against the board's award of costs. The Administration explained to Members that the power to award costs under clause 21(1)(k) is qualified by clause 22. This limits the circumstances where costs can be awarded against an appellant where the appellant has conducted his case in a frivolous or vexatious manner. Other parties, which will usually be the Government or public bodies, can have costs awarded against them only where it would be unjust or inequitable not to do so. The costs may also be subject to taxation. The Administration assures Members that there is no real need to provide for an appeal provision since a decision of the Board to award or refuse costs would be subject to judicial review. Members accepted the Administration's explanation.
The FIFTH area of controversy is the right of further appeal by the appellant on a point of law. Clause 24 enables the board, on the recommendation of the chairman, and before an appeal is determined, to refer any question of law arising in the appeal to the Court of Appeal for determination by way of case stated. Members suggested that the Administration should consider allowing the appellant to seek leave of court to refer a point of law to the Court of Appeal for determination even without the recommendation of the chairman. The Administration has strong reservation on the suggestion to provide a further appeal avenue on a point of law and stresses that the AAB is intended to be a general administrative appeals board with simple procedures to deal with matters before it in an expedient and inexpensive manner. The setting up of an elaborate system of referral to the court on application by the parties involved would delay the final disposal of the matter and push up the costs of the proceedings. The Administration further assures Members that the emergent rule relating to judicial review is that nearly all errors of law are reviewable. This being the case, it would be most unlikely
2056 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
for a person aggrieved by a decision of the AAB involving an error of law to be left in the position of having no remedy. The creation of a right of appeal in addition to the avenue of judicial review could create problems as to which avenue is appropriate in any particular case; a person aggrieved by a decision of the board might be required to pursue an appeal on a point of law before being allowed by the courts to pursue a claim for judicial review. Given these assurances, the majority of Members accepted the Administration's reasons for not creating an additional right of appeal in respect of a point of law in addition to the possibility of judicial review. However, in order to allay fears that the chairman can arbitrarily refuse to refer a point of law to the Court of Appeal, Members and the Administration agreed to delete the words "on the recommendation of the Chairman" from clause 24 so as to confer the decision on the board as a whole rather than the chairman alone. I will move the necessary amendment during the Committee stage.
Mr President, 25 pieces of legislation in which decisions made under them are appealable to the Governor in Council are specified in the Schedule to the Bill so that these decisions would be appealable in the future to the board instead. It is the intention of the Administration to keep the operation of the board under review and to consider substituting the Governor in Council as an appellate body by the board in due course. Moreover, if the operation of the board proves to be successful, it may gradually replace some other appeal boards now in existence.
As the board will conduct its hearings in public, and the appellant will have the right to attend or be represented by counsel, the enactment of this Ordinance will allow a more open and uniform appeal procedure to be introduced in the hearing of administrative appeals by an independent appeal board. May I stress once again the key words "open", "uniform", "independent". It must now be transparent that the key intention of the Bill is to substitute appeals to the Executive Council by a transparent, fair and judicial procedure so that justice is not merely done but is seen to be done.
Mr President, with these remarks, I support the Bill.
DR LAM KUI-CHUN: Mr President, the Administrative Appeals Board Bill seeks to provide an open, unified, and independent channel of appeal against government decisions on affairs affecting the public. It unloads these matters from the Executive Council so that the Council can concentrate more on policy matters for Hong Kong. The Bill deserves the support of the Legislative Council.
In anticipation of its future work, supplemental to the Honourable Andrew WONG's summary of the deliberations of the Bills Committee, I wish to highlight the following points:
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2057
(1) For the Administrative Appeals Board to function properly, its decisions must be final. No higher authority, whether in the High Court or the Court of Appeal, must be available to overturn the board's decisions. I am glad that this is the provision within this Bill. Otherwise, as experience in the Urban Council and the Municipal Services Appeals Board shows, further appeals will be lodged higher up the ladder of authority until the final venue of appeal is reached, and all decisions of lower ranks will become a total waste of time.
In spite of the above, to ensure full justice, judicial review should be available where a procedure in hearing is perceived to run counter to natural justice. Caution is needed in this practice. Experience in the Immigration Tribunal shows that such an avenue may be abused by appellants who have everything to gain and nothing to lose by further action, and such a practice is frequently facilitated — sometimes even engineered — by the Legal Aid Department, often at great cost to the taxpayer. The Government should keep the situation under constant monitor.
(2) Appellants should be aware that decisions of the board are alternative decisions on the issues, and neither prove nor hint that prior decisions of the Administration are necessarily wrong. Thus, decisions of the board do not entail questions of competence of the Administration or of compensation due to administrative error. For this reason, I agree with the Administration that if different decisions are reached by the Administration and the board, the board should not have the power to award compensation to the appellant for losses that may have been incurred from the Administration's decisions. If the appellant wishes to complain against the Administration, the proper channel should be COMAC. If he seeks compensation, he should approach the courts of law.
(3) The Bill strikes at the heart of the Government's decision-making process. The board so formed must not function as an alternative centre of administrative power that makes a mockery of the competence of the Administration, and neither should the board be seen to side with the Government in any situation. Further, the board must not attempt to alter government decisions to build up a power base for itself or for a particular sector of society.
Thus, it is of utmost importance that members of the board are of impeccable integrity, of high intellectual capability, and are free from conflicts of interests. A spread of expertise to cover the wide range of departments involved will be desirable.
Mr President, with these remarks, I support the Bill.
2058 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
CHIEF SECRETARY: Mr President, I am most grateful to the Honourable Andrew WONG and other Members of the Bills Committee for the careful consideration given to the Bill, and for the amendments proposed.
The Bill seeks to provide for a more structured and uniform system to deal with certain administrative appeals through the establishment of an independent Administrative Appeals Board. The board will conduct hearings in public except in special circumstances. The appellant will have the right to attend and be represented at hearings. The board will be required to state in writing the reasons for its decisions. These arrangements will not only improve the transparency of the determination of appeals, but will also enhance the quality of the administration of justice. I am pleased that these underlying principles have the support of the Bills Committee. There were nonetheless some aspects of the Bill which were the subject of discussion at the Bills Committee stage. I will deal with the major points here.
Scope of the Board
Our intention is that initially the board should only deal with relatively general and simple appeals, including miscellaneous licensing and registration appeals. This will give the board time to establish itself and to build up expertise. While some Bills Committee members would like to expand the scope of the board, we believe that we should set up the appeal mechanism first, with provision for additions later on. To allow room for expansion, clause 4 of the Bill enables the Governor in Council to extend the jurisdiction of the board by order.
Secretary's power
Some Bills Committee members have expressed concern that the appointment powers of the Secretary to the board might be too wide. The proposal that the Secretary should be empowered to appoint an acting chairman during the chairman's absence and to decide which persons on the panel should be board members in any particular case was intended to ensure the smooth running of the board. However, we have accepted the views of Bills Committee members that the powers of the Secretary should be limited. Thus, we have agreed to add a general provision in clause 7 providing that the secretary shall, in exercising his function under the Ordinance, comply with any directions given by the chairman of the board. In addition, given the board chairman is to be appointed by the Governor, we agree that it would be more logical to vest the power to appoint an acting chairman in the Governor as well.
Power to recommend/award ex gratia payments
The question of whether the board should be given the power to award or recommend ex gratia payments to a successful appellant has also been considered carefully. As the Honourable Andrew WONG has pointed out, the Administration takes the view that any recommendation on public expenditure
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2059
should come from the Administration and be approved by the legislature. It would therefore be inappropriate for the board, whose sole purpose is to hear appeals against administrative decisions, to recommend or award ex gratia payments. Nonetheless, to address this point, we agree that the Board should be given the power to refer matters back to the respondent, that is, the original decision maker, for consideration. These matters could cover the question of ex gratia payments, if deemed appropriate by the board.
Claiming of privileges
Some Bills Committee members have pointed out that not only the respondent, but also the appellant, should be entitled to claim privileges in respect of disclosure of information. This is a valid point and we agree that clause 14 should be amended accordingly.
Referral to the Court of Appeal
It has been suggested that the board should be allowed to refer questions of law arising in the course of an appeal to the Court of Appeal on application by a party to the appeal. We believe, however, that it is undesirable to allow the Court to intervene in the appeal proceedings. Moreover, the setting up of a detailed referral mechanism is likely to delay the handling of the appeal and could lead to delaying tactics.
Further appeal avenue
The Bills Committee has also considered the proposal that a right of appeal to the Court on a point of law after the determination of an appeal should be provided. We should, however, not lose sight of the fact that the Administrative Appeals Board is intended to be a general appeals board with simple procedures to deal with matters before it expeditiously and in a cost-effective manner. Therefore we do not consider it necessary or desirable to provide a further right of appeal. The remedy of judicial review should be adequate to cater for any errors of law committed by the board.
Publicity
Subject to the passage of the Bill by this Council, the relevant branches and departments will be asked to draw potential appellants' attention to the right of appeal to the Administration Appeals Board. This information may be included in, for example, the notice of a decision given by an administrative authority.
Mr President, with these remarks, I recommend the Bill to Members.
Question on the Second Reading of the Bill put and agreed to.
2060 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 Bill read the Second time.
Bill committed to a Committee of the whole Council pursuant to Standing Order 43(1).
COMMODITIES TRADING (AMENDMENT) BILL 1993
Resumption of debate on Second Reading which was moved on 15 December 1993 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).
SECURITIES (AMENDMENT) BILL 1993
Resumption of debate on Second Reading which was moved on 15 December 1993 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.
ADMINISTRATIVE APPEALS BOARD BILL
Clauses 1 to 3, 5, 9, 11, 16, 19, 20, 22 and 26 to 60 were agreed to.
Clauses 4, 6 to 8, 10, 12 to 15, 17, 18, 21 and 23 to 25
MR ANDREW WONG: Mr Chairman, I move that the clauses specified be amended as set out in the paper circulated to Members.
Clause 4(3)(e) is amended to make clear that the power of the Governor in Council to amend an Ordinance is confined to the circumstances listed in the
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2061
subclauses that follow which are specific to the Bill and such amendment conforms with the legislative intent.
In order to put the Secretary's power under control, clause 7 is amended to add a new subclause to the effect that the Chairman of the AAB may give such directions as he thinks fit to the Secretary with respect to the exercise of the Secretary's functions and that the Secretary shall comply with any direction so given.
Clause 8(1) is amended to vest the power to appoint a deputy chairman to act as chairman during the latter's absence on the Governor and not the Secretary.
Clause 10 is amended to add deadlines for the Secretary to serve notice of appeal on the respondent and any person, other than the appellant, who appears to the Secretary to be an affected party.
Clause 14 is amended to add a new subclause to allow the appellant as well as the respondent to have a right to claim privileges in respect of disclosure of information as if the proceedings before the AAB were proceedings before a court of law.
A new subclause under clause 21 is added to empower the board to order the case in question to be referred back to the respondent for consideration of such matters, such as the award of ex gratia payment, as the Board may order.
Clause 24 is amended to delete "on the recommendation of the Chairman". This will enable the board, as a whole instead of the Chairman alone, to refer any question of law arising in the appeal to the Court of Appeal for determination by way of case stated.
The other amendments, including those to the Chinese text of the Bill, are minor technical or editorial amendments for the purpose of clarifying the meaning and maintaining consistency.
Mr Chairman, I beg to move.
Proposed amendments
Clause 4
That clause 4(3)(e) be amended, by deleting "to -" and substituting "to, and only so as to -".
Clause 6
That clause 6(6) be amended, by adding "及金額" after "酬金".
2062 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 Clause 7
That clause 7 be amended, by deleting the clause and substituting —
"7. Secretary
(1) There shall be a Secretary to the Board who shall be appointed by the Governor.
(2) The Chairman may give to the Secretary such directions as he thinks fit with respect to the exercise of the Secretary's functions under this Ordinance, either generally or in any particular case; and the Secretary shall comply with any direction so given.".
Clause 8
That clause 8(1) be amended, by deleting "Secretary" and substituting "Governor".
Clause 10
That clause 10 amended, by deleting the clause and substituting —
"10. Secretary to serve notice
of appeal on respondent
The Secretary shall serve a copy of a notice lodged with him under section 9 on -
(a) the respondent within 14 days after a notice of appeal is so lodged, or such longer period as the Chairman, on application, may allow in any particular case; and
(b) any person, other than the appellant, who appears to the Secretary to be a person who -
(i) is bound by the decision appealed against; or
(ii) before the decision appealed against was made, had made representations to the respondent in relation to the subject-matter of that decision,
within 28 days after a notice of appeal is so lodged, or such longer period as the Chairman, on application, may allow in any particular case.".
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2063 Clause 12
That clause 12 be amended, in the Chinese text, by deleting subclause (2) and substituting —
"(2) 根據本條送達的通知具有效力，猶如通知是主席的合法命令、規定或指示㆒ 樣".
Clause 13
That clause 13 be amended, in the Chinese text, by deleting subclause (2) and substituting —
"(2) 根據本條送達的通知具有效力，猶如通知是主席的合法命令、規定或指示㆒ 樣".
Clause 14
That clause 14 be amended, by deleting the clause and substituting — "14. Privilege against disclosure
(1) A respondent shall, for the purposes of an appeal, have the same privileges in respect of disclosure of information, particulars and documents as if the proceedings were proceedings before a court of law; and the Board may, on the application of the appellant or of any person of the description mentioned in section 11(1)(a), give directions relating to -
(a) the disclosure to the appellant or to any such person of any information, matter or particular referred to in section 11 or 12; or
(b) the provision or the production to the appellant or to any such person of a document or part of a document or a copy of a document or a copy of part of a document referred to in section 11 or 13; or
(c) the inspection by the appellant or by any such person of any such document, copy or part.
(2) An appellant and any person of the description mentioned in section 11(1)(a) shall, for the purposes of an appeal, have the same privileges in respect of disclosure of information, particulars and documents as if the proceedings were proceedings before a court of law; and the Board may, on the application of any of the parties to the appeal, give directions relating to -
2064 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
(a) the disclosure to any such party of any information, matter or particular referred to in section 12; or
(b) the provision or the production to any such party of a document or part of a document or a copy of a document or a copy of part of a document referred to in section 13; or
(c) the inspection by any such party of any such document, copy or part.
(3) The Board shall not give directions under this section without affording the party in respect of whom the directions are to be given an opportunity to make representations to it.
(4) For the purposes of this section, the question, in any particular case - (a) as to whether the Board should give directions under this section; and
(b) where the Board gives directions, as to whether those directions were properly given,
shall be a question of law.".
Clause 15
That clause 15 be amended, by deleting "Secretary to issue a notice in writing under section 21(1)(c)" and substituting "Board to issue a notice in writing".
Clause 17
That clause 17(3) be amended, by deleting "any of those parties and any claim by the respondent as to privilege" and substituting "and any claim as to privilege by any of those parties".
That clause 17(4) be amended, by deleting "the respondent" and substituting "any party".
Clause 18
That clause 18 be amended, by deleting "counsel" and substituting "a barrister".
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2065 Clause 21
That clause 21 be amended, by adding —
"(3) The Board, on the determination of any appeal, may order that the case being the subject of the appeal as so determined be sent back to the respondent for the consideration by the respondent of such matter as the Board may order.".
Clause 23
That clause 23 be amended, by deleting "and in the case of an equality of votes the Chairman shall have a casting as well as a deliberative vote".
Clause 24
That clause 24 be amended, by deleting "述要" wherever it appears and substituting "呈述 ".
That clause 24(1) be amended, by deleting ", on the recommendation of the Chairman,".
Clause 25
That clause 25(1) be amended, by adding "根" before "據的證據".
Question on the amendments proposed, put and agreed to.
Question on clauses 4, 6 to 8, 10, 12 to 15, 17, 18, 21 and 23 to 25, as amended, proposed, put and agreed to.
Schedule
MR ANDREW WONG: Mr Chairman, I move that the schedule be amended as set out in the paper circulated to Members.
The amendment to column 3 of the schedule is to give a brief description of the types of administrative decisions which are within the purview of the AAB so that members of the public will find in the schedule enlightening descriptions rather than baffling numbers of the relevant Ordinances.
Mr Chairman, I beg to move.
2066 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 Proposed amendment
Schedule
That schedule be amended, by deleting the Schedule and substituting — "SCHEDULE [ss. 3, 4 & 22]
Item Ordinance Decision
1. Apprenticeship Ordinance (Cap. 47)
2. Boilers and Pressure Vessels
Ordinance (Cap. 56)
3. Employment Ordinance (Cap. 57)
4. Factories and Industrial
Undertakings
Ordinance (Cap. 59)
A decision of the Director of Apprenticeship or any public officer in the performance or exercise of any function, duty or power under the Ordinance.
The revocation or suspension of an appointment as a boiler inspector, air receiver inspector or pressurized fuel container inspector under section 5A.
A decision of the Commissioner for Labour under section 53(1) to refuse to issue or renew or to revoke a licence to operate an employment agency.
(a) An exemption by the
Commissioner for Labour under section 7(4) of an industrial
undertaking from any
regulation.
(b) An order by the Commissioner for Labour under section 7(4), for an industrial undertaking to adopt special precautions in
addition to any precautions
required by any regulation.
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2067
Item Ordinance Decision (c) Under section 9A -
(i) the issue by the
Commissioner for
Labour of a
prohibition notice in
respect of a notifiable
workplace;
(ii) a refusal by the
Commissioner for
Labour to cancel a
prohibition notice;
(iii) the giving by the
Commissioner for
Labour of any
direction upon the
cancellation of a
prohibition notice.
5. Quarries (Safety) Regulations (Cap. 59
sub. leg.)
6. Factories and Industrial Undertakings (Safety
Officers and Safety
Supervisors) Regulations
(Cap. 59 sub. leg.)
(a) A refusal by the
Commissioner for Labour to approve any person as a supervisor or deputy
supervisor under
regulation 4(1) or 6(1).
(b) A withdrawal by the Commissioner for Labour of his approval of a
supervisor or deputy
supervisor under
regulation 10(1).
(a) A refusal by the
Commissioner for Labour to register a person as a
safety officer under
regulation 7.
(b) The cancellation by the Commissioner for Labour of a person's registration as a safety officer under
regulation 9.
2068 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 Item Ordinance Decision
(c) The suspension by the
Commissioner for Labour of
a person's registration as a
safety officer under
regulation 10.
7. Weights and Measures
Ordinance
(Cap. 68)
8. Miscellaneous Licences
Ordinance
(Cap. 114)
9. Acetylating Substances
(Control)
Ordinance
(Cap. 145)
A decision of the Commissioner, as defined in section 2, or of an authorized officer which is taken in the exercise or performance of any function under the Ordinance.
The decision under section 5 of any officer authorized to issue a licence under the Ordinance as to the grant of a licence, the renewal of a licence or the revocation of a licence.
A decision of the Commissioner, as defined in section 2(1), under the Ordinance, relating to –
(a) the issue of a licence or permit;
(b) the refusal to issue a licence or permit;
(c) the cancellation or
suspension of a licence or permit;
(d) the cancellation or variation of any condition or the
specification of a new
condition in a licence or
permit.
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2069 Item Ordinance Decision
10. Gambling
Ordinance (Cap. 148)
11. Chinese Temples Ordinance (Cap. 153)
12. Weapons
Ordinance (Cap. 217)
13. Travel Agents Ordinance (Cap. 218)
The decision under section 22 of the Commissioner for Television and Entertainment Licensing as to the grant of a licence, the renewal of a licence, the imposition of conditions of a licence or the cancellation of a licence.
(a) The refusal by the Chinese Temples Committee under
section 4 to grant an
exemption from section 4(1).
(b) The withdrawal by the Chinese Temples Committee under
section 4 of an exemption
granted under section 4(1).
A decision of the Commissioner of Police under section 9(1) to order the delivery up to him or seizure of any martial arts weapon.
A decision of the Registrar of Travel Agents -
(a) to refuse to grant a licence under section 12(1);
(b) to impose conditions on a licence under section 11(1) or 18;
(c) to refuse consent to a change of ownership or control under
section 18(c);
(d) to suspend or revoke a licence under section 19.
2070 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 Item Ordinance Decision
14. Firearms and Ammunition
Ordinance (Cap. 238)
15. Massage
Establishments
Ordinance (Cap. 266)
16. Grant Schools Provident Fund Rules
(Cap. 279 sub. leg.)
17. Subsidized Schools Provident Fund Rules
(Cap. 279 sub. leg.)
18. Mining Ordinance (Cap. 285)
(a) A decision of the Commissioner of Police refusing to grant a
licence under section 30 or to renew a licence under section 32.
(b) A decision of the Commissioner of Police, under section 33,
cancelling a licence or varying or revoking any condition
attached thereto or adding any further condition or deleting any premises from a dealer's licence at which business may be carried on.
(c) The imposition of a condition of licence which is considered to be unreasonable.
A decision of the licensing authority under section 6, 7, 8 or 9.
A question of interpretation or application of the Rules.
A decision of the Board under the Rules.
The cancellation of an Authorized Buyer's Licence under section 41.
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2071 Item Ordinance Decision
19. Mining (General) Regulations
(Cap. 285 sub. Leg.)
20. Dangerous Goods Ordinance (Cap. 295)
21. Dangerous Goods (General)
Regulations
(Cap. 295 sub. leg.)
22. Business Registration Ordinance (Cap. 310)
23. Motor Vehicles (First Registration Tax)
Ordinance (Cap. 330)
24. Animals (Control of Experiments)
Ordinance (Cap. 340)
25. Chinese Permanent Cemeteries Rules
(Cap. 1112 sub. leg.)
A decision of the Commissioner of Mines under regulation 30(4A)(a) specifying the rate per tonne at which royalty shall be payable in respect of minerals and the period for which it shall be payable.
A decision under section 9 of an officer authorized under the Ordinance to issue a licence -
(a) to refuse to grant a licence; (b) to refuse to renew a licence; or (c) to revoke a licence.
Prohibiting or imposing conditions on the continued use of a storage tank under regulation 127.
An assessment of a business registration fee under section 3(4) or 9(5).
A decision of the Commissioner for Transport under the Ordinance.
A refusal to issue a licence,
endorsement or permit under section 7, 8, 9, 10 or 14.
A decision of the Board of
Management of the Chinese Permanent Cemeteries not to withdraw a notice in rule 12(2) regarding reversion of a subscriber lot to the Board.
2072 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
Item Ordinance Decision
Note: The Board of Management
of the Chinese Permanent
Cemeteries is specified for
the purposes of section
22(5) of this Ordinance.
Time within which appeals are to be made
An appeal under any item mentioned in this Schedule shall be made within 28 days after receipt of notice of the decision to which the appeal relates.".
Question on the amendment proposed, put and agreed to.
Question on the schedule, as amended, proposed, put and agreed to.
COMMODITIES TRADING (AMENDMENT) BILL 1993
Clauses 1 to 3 were agreed to.
SECURITIES (AMENDMENT) BILL 1993
Clauses 1 and 2 were agreed to.
Council then resumed.
Third Reading of Bills
THE ATTORNEY GENERAL reported that the
ADMINISTRATIVE APPEALS BOARD BILL
had passed through Committee with amendments and the
COMMODITIES TRADING (AMENDMENT) BILL 1993 and
SECURITIES (AMENDMENT) BILL 1993
had passed through Committee without amendment. He moved the Third Reading of the Bills.
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2073 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 for the motion debates and Members were informed by circular on 24 January. The mover of the motion will have 15 minutes for his speech including his reply and another five minutes to reply to proposed amendments. Other Members, including movers of amendments, will have seven minutes for their speeches. Under Standing Order 27A, I am required to direct any Member speaking in excess of the specified time to discontinue his speech.
MID-TERM REVIEW OF THE LONG TERM HOUSING STRATEGY DR CONRAD LAM moved the following motion:
"That this Council urges the Housing Authority to take heed of the views expressed by this Council and the public on the Report on the Mid-Term Review of the Long Term Housing Strategy, and to formulate on the basis of the views so taken a housing policy which is able to address the housing needs of the general public in Hong Kong."
DR CONRAD LAM (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper. On 6 May 1992, during a debate in this Council on the Long Term Housing Strategy, the Secretary for Planning, Environment and Lands noted that the housing policy laid down by the Government in 1986 had six basic objectives:
(1) to ensure adequate housing at an affordable price or rent for all households; (2) to satisfy the growing demand for home purchase;
(3) to ensure the timely provision of housing to meet demand;
(4) to improve living conditions by redeveloping sub-standard older public and private housing;
(5) to ensure the most effective use of both public and private sectors in housing production; and
2074 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 (6) to ensure the efficient use of public resources by relating housing subsidy to need.
These policy objectives were formulated many years ago. But they have not been backed up with concrete action. The results have been barely acceptable. In today's motion debate, Members from the United democrats of Hong Kong (UDHK) will tackle the subject from various perspectives: Rev FUNG Chi-wood and I will speak on home ownership; Mr Albert CHAN will discuss the problems in the re-development of public housing estates generally; Mr CHEUNG Man-kwong will show how runaway property prices are making it difficult for people of the middle and lower social strata to buy homes; Dr HUANG Chen ya will discuss pre-conditions for the introduction of type II public housing; Mr LEE Wing tat will talk about land shortages and long waiting lists; and Dr YEUNG Sum will give his observations on the existing private sector oriented housing strategy and explain why it is of no use at all for solving the housing problem. I will then wrap up the UDHK's proposals.
Mr President, in moving the motion today, my purpose is to express a hope that the Housing Authority will listen to, and heed, the views expressed and then lay down a housing policy that is really able to address the housing needs of the general public. Is the existing housing strategy effective in solving the housing problem? The answer ought to be clear to us, if we care to take a look at the members of the public who are now standing outside this Council. A person who applied for public housing in urban areas during the period from 1987 to 1992 had to wait 10 to 12 years. Even an applicant for public housing in Tuen Mun or Yuen Long had to wait three to five years. The waiting time would be even woefully longer in the case of single persons.
The Housing Authority at present is unable to supply 1 000 units a year, though the applicants who have waited at least 10 years number in the tens of thousands. To a low income applicant, it seems to be asking too much to be assigned an urban public housing unit.
Where Home Ownership Scheme (HOS) housing is concerned, the successful rate of white form applicants is 5% in the last two rounds of lottery. The Housing Authority has just changed the ratio of apportionment between green form users and white form users from 1:1 to 2:1. This means that white from applicants now stand even a slimmers chance of being drawn on the lottery. Suppose that a person submits an application to try his luck each time when a lottery is held. In terms of probability, he may have his wish answered the 15th or even the 30th time around. Given that HOS housing is put on the market three times a year, generally speaking, he may probably get his unit after applying every time for 10 consecutive years. If he is out of luck, he probably will not get his unit even after applying every time for 20 consecutive years.
There is a Chinese saying that "the worldly affairs would undergo drastic changes with the passage of a decade". Unfortunately for the low-income people
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2075
of Hong Kong, many of them, though having gone through a lot of changes during the past 10 years, are still hard pressed by high rental level in private housing. It is increasingly hard for them to be assigned public housing units or to buy HOS housing units. Meanwhile, drastic changes have taken place over the same period in the private property market with property prices doubled and redoubled. The property price is now 5.5 times what it was 10 years ago. Evidently, the present housing strategy is a failure. It has been ineffective in arresting the sharp increases in private housing prices. It has failed to meet people's needs of public housing and now those in need of public housing or HOS housing will have to wait for eight or 10 years.
The Housing Authority's present review is neither a review of the objectives of the existing housing strategy nor a review of the private sector oriented policy. It is a strategy review in name. It reinforces the existing privatization policy, by seeking to put public housing units on sale. I think that the Government is using stick and carrot tactics to advance its policy goal of encouraging home ownership among members of public. I think so for the following reasons:
(1) The Long Term Housing Strategy of 1987 encourages home ownership but does not set any ratio. The present mid-term review of this strategy has practically given substance to what the Governor said in his 1992 policy address that the target was for nearly 60% of all households to own their homes by 1997. However, government officials have never explained why the target is for 60% of all families to own their homes by 1997. Why not, say, 50% or 70%?
(2) Public housing has deliberately been made less attractive in order to depress the demand for public housing. The Housing Authority has stated that those sitting tenants of public housing units who decline to buy type II public housing units may be moved to vacant units in remote and less popular locations and be subjected to harsher lease terms or have to accept rent increases of some size. Such discriminatory and punitive measures against the sitting tenants evince the Government's to make them buy their homes.
(3) Income ceilings for those who are eligible for public housing or HOS housing are set at a low level to disqualify many who need these kinds of housing so that they are not even given a chance to apply for public sector housing. As a result, the demand for private sector housing will of course rise.
(4) The production of public housing units is bridled. People have to wait many years before they will be assigned public housing or HOS housing. This indirectly presses them to buy homes in the private property market.
2076 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
(5) The Government has taken no effective action against property speculation even though property prices have been soaring. Residential property has now become more useful as investment than as homes. This certainly fuels speculation. Members of lower and middle income groups, with inflation eating into their savings as they can only earn insignificant bank interests, have to rush to buy property as a hedge against inflation.
(6) For the eight financial years from 1993-94 to 2000-01, the projected demand for private sector housing is 138 000 units or 17 000 units a year on average. However, under the Long Term Housing Strategy, the Government projects the annual demand for private sector housing at 35 000 units. The over-statement gives the Government an excuse to prop up property prices. The Housing Authority will also be able to resuscitate the dying Home Ownership Loan Scheme. This propping up of property prices would be carried out on a massive scale and on a long term basis as well.
Evidently, the existing housing policy is to do everything possible to depress the demand for public housing and at the same time to increase interests in home ownership. This is a disguised way to force people to buy their homes and is no real solution to people's housing problem. Such being the case, the purpose of my motion is to urge the Housing Authority to formulate a housing policy which is really able to address the housing needs of the general public, and this objective should be accorded first priority. I want to stress that the demand for places to live is not the same thing at all as the demand for home ownership. I hope that the Housing Authority will not promote home ownership exclusively.
Mr President, I have the following suggestions to make:
(1) Through the Land Commission, discussions should be held with the Chinese side about increasing land supply.
(2) Action should be taken against property speculation. One way is to start collecting a capital gains tax on property transaction.
(3) The private sector oriented Long Term Housing Strategy should be replaced by a strategy with public housing and HOS housing playing a dominant role.
(4) Transport links between Hong Kong and our neighbour should be improved. A specific study should be made on how our neighbour could support Hong Kong with its land resources.
The UDHK always think that Hong Kong's housing problem can be solved only by a huge public sector housing scheme, a scheme in which public housing and HOS housing play a dominant role. The UDHK think that, from now until
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2077
year 2001, the supply of rental public housing should exceed the supply of HOS housing. Therefore, we accept Mr Frederick FUNG's amendment.
With these remarks, I move the motion.
Question on Dr Conrad LAM's motion proposed.
PRESIDENT: Mr K K FUNG has given notice to move an amendment to the motion. His amendment has been printed in the Order Paper and circulated to Members. I propose to call on him to speak and to move his amendment now so that Members may debate the motion and the amendment together.
MR FREDERICK FUNG moved the following amendment to Dr Conrad LAM's motion:
"To delete all the words after "That this Council urges the Housing Authority" and substitute ", in formulating its recommendations in the Report on the Mid-Term Review of the Long Term Housing Strategy, to adopt the public rental housing oriented approach in the provision of public sector housing so as to solve the housing problems of the middle and lower social strata.""
Mr FREDERICK FUNG (in Cantonese): Mr President, I move that Dr Conrad LAM's motion be amended as set out in the Order Paper.
My speech will consist of two parts. Firstly, I consider that Dr LAM's motion which seeks to evaluate and formulate our future housing policy on the basis of the public's comments on the Report on the Mid-Term Review of the Long Term Housing Strategy is inappropriate in approach. As we all know, the Housing Authority had published a lot of consultation papers over the past years. Here are some papers for our reference. For papers of smaller size, the Housing Authority will print 100 000 copies each whereas for papers of bigger size with data, more than 10 000 copies each will be printed and made available to the public on request. But the Report on the Mid-Term Review of the Long Term Housing Strategy is available only in photostat copies, and not many copies are available to the public. I learnt from the Housing Department that only about 1 900 photostat copies have been made, of which 142 copies were distributed to organizations and private individuals, 627 copies to district boards and 1 167 copies to mutual aid committees. From the number of copies of report distributed, we can see that the feedback that will be obtained in future will, to a great extent, be confined to the views of certain people. While we cannot say that these people are not representative, we can at least say that there has not been a full consultation. I therefore consider that the basis of formulating policies in the light of the findings of the consultation is very weak.
2078 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
On the other hand, the report has, in fact, provided a lot of data showing the current housing situation, the demand and supply for housing, and the options recommended to us by the Housing Department for the next seven years. I consider that such data and the data I got from the Census and Statistics Department have already given us a rough idea on the future supply and demand situation. I consider that it is indeed an appropriate way to make suggestions to the Housing Authority in the light of such data and situations.
Secondly, I think that Dr LAM's motion itself is a neutral one. In fact, the Housing Authority will take the Council's proposal in the light of the wording of the endorsed motion. Members' speeches will be for consideration only and will not be treated as the views of the Council. I think that if my amendment can give the Housing Authority and the Housing Department a clear picture of what the Council expects them to do in the coming years, especially in the run-up to 1997, it is more appropriate to move the amendment now in the last few days of the consultation period. Therefore, I consider that it is necessary to move this amendment to the motion so that as soon as the amendment is passed, we can give the Housing Authority a clear picture of our proposal.
Next, I would like to talk about why, in my opinion, my amendment merits your consideration, and also the ways to address housing problems in the run-up to 1997 as proposed in the report on the mid-term review, especially the ways to deploy resources. The analysis below is based on the data provided in the report on mid-term review and the data I got from the Census and Statistics Department. First of all, I would like to draw your attention to two figures used by the Housing Authority in addressing housing problems. The first figure is the number of public rental housing units required in the coming four or five years, that is up to 1997 or 1998. According to the data provided in the report (that is the number of applicants on the waiting list of public housing to be attended to and the number of persons to be rehoused due to clearance and redevelopment in relation to the future supply of housing units and vacant units), there will still be a shortfall of 16 600 housing units. The second point is that, according to our information obtained from the Census and Statistics Department (the latest information covers the third quarter of 1993), and by the Housing Authority's standard, a family of four living in a private flat of 40 sq m pays an average rental of $6,900 a month. The median income of such families is $13,000. In relation to their incomes, their rental expenses represent nearly half of their incomes and are therefore a very heavy burden to them. In this connection, the income ceiling for public housing applicants, that is $11,400 per month for four-person families, may in fact be inappropriate. This means that the relevant proposals may have inhibited the demand. In other words, the actual demand for public housing may be more than 16 600 units.
There are several questions in this connection. Firstly, during a review on the waiting list in the recent year, the Housing Department trimmed down the number of applicants on the waiting list from 170 000 to 120 000. It was estimated that there were only 77 000 families really in need of public housing and they will be allocated public housing units
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2079
Secondly, I see that there are three kinds of income ceilings for the purpose of means test, that is income ceilings for people in the sandwich class, for Home Ownership Scheme (HOS) housing applicants and for applicants on the waiting list of public housing. However, of these three kinds of income ceilings, the one for applicants on the waiting list of public housing is the harshest. As we can see, the sandwich class will have up to 95% of its members subsidized but only less than one-third of the applicants on the waiting list of public housing will be allocated public housing units. Is the less than one-third proportion an appropriate figure? Now that property prices and rents are quite high, should help not be given to rehouse 50% of the applicants on the waiting list? This is the question to be addressed.
Lastly, we can see that the ratio of public housing to HOS housing was 1:2 over the past seven years, meaning that there was one public housing unit for every two HOS housing units. In absolute terms, there were 120 000 public housing units compared with 230 000 HOS housing units. However, for the next seven years, the ratio will be 1:1, that is 170 000 public housing units compared with 170 000 HOS housing units. We see that while the demand is on the increase, the supply is dwindling. What are the reasons for this?
The report proposes the provision of Type II HOS housing, that is to convert some public rental units to HOS housing units for sale. This will make the demand for public housing even more pressing. Therefore, I consider that the proposal is questionable.
In view of this, I have five proposals to put forward:
Firstly, I hope that the Housing Authority will cater mainly to the housing needs of the middle and lower social strata and stick to the public housing oriented polices in the provision of public housing.
Secondly, public rental housing should take priority over other public housing in addressing the housing problem of the middle and low income social strata.
Thirdly, the ratio of public housing to HOS housing should be changed to 2:1.
Fourthly, resources for redevelopment areas should not be used on Type II HOS housing. Only resources for HOS housing or newly allocated resources should be used on this type of HOS housing.
The buzzer sounded a continuous beep.
PRESIDENT: Mr FUNG, you have to stop.
Question on Mr Frederick FUNG's amendment proposed.
2080 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
MRS SELINA CHOW (in Cantonese): Mr President, the Housing Authority in October last year completed its Report on the Mid-Term Review of the Long Term Housing Strategy. The report is a comprehensive re-evaluation of the housing policy. The Liberal Party supports any initiatives to meet the housing needs of the public.
We felt at first that Dr Conrad LAM's original motion was more objective, reasonable and balanced. To our surprise, Dr LAM's speech gave us the impression that he and his colleagues of the United Democrats of Hong Kong (UDHK) had switched to supporting Mr Frederick FUNG's amendment. This has now put us in some kind of a dilemma. We usually do not have many occasions for supporting the UDHK's position. Nor does the UDHK want our support. As for Mr FUNG's amendment, it does not appear to be comprehensive enough. Nor does it look at our housing problem from an overall perspective. The amendment is definitely quite one-sided. For instance, concerning the supply of public sector housing, Mr FUNG says that "to adopt the public rental housing oriented approach ..... so as to solve the housing problem of the middle and lower social strata". He seems to suggest that members of the middle and lower income groups generally do not want, nor have financial means, to be home owners. We feel that this assumption may not be tenable. We will come back to it later. Mr FUNG said something about the consultation process. He took me by surprise, for he is a member of the Housing Authority and he in fact took part in the preparation of the report. If he found the consultation process defective, I wonder why he did not try to have it remedied within the Housing Authority. Mr FUNG just now mentioned the question of direction. He says that his amendment shows the way forward. Yet I think he is biased and his amendment shows only one way forward. He misses some of the other important things mentioned in the mid-term review report, such as land supply and the projected changes in the public sector housing development scheme. We may have found his amendment more deserving of our support if he had shown the way forward in various aspects. It cannot be denied that, in terms of evaluation of the mid-term review report, Mr FUNG's amendment is not as constructive as the original motion. His amendment, if not diametrically opposed to the thinking of our party, somewhat differs from our position.
The Liberal Party always thinks that the ultimate goal of the Government's housing policy should be to make it possible for everybody who needs a home to become a home owner. It should seek to give everybody a chance to own his home and to realize his dream of becoming a home owner. This is in fact the dream of most people. From the Government's point of view, home ownership is the best way to strengthen the sense of community belonging and the sense of responsibility on the part of members of the public. In any capitalist society where home ownership is encouraged, private property is also respected. One's sense of belonging in a community is strengthened more by one's investment in real estate, such as residential property, than by one's investment in movables, such as stocks and foreign currencies. If the residential property is one's own home, so much the better. Home ownership to be
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2081
promoted in the form of a policy is certainly conducive to the individual's loyalty to the community; it also enhances the community's prosperity and stability. I wish to stress one point. Housing problem is not confined to the middle and lower social strata. Nor is the Home Ownership Scheme (HOS) any imperial edict which middle and lower social strata must obey. HOS is in fact as much as option for them as it is also for other members of the community. Accepting it or not is up to the individual, depending on his needs and means. If it is decided at the outset that rental public housing should play the dominant role so as to solve the housing problem of the middle and lower social strata, will this not indirectly deprive them of the freedom of choice, which is within their basic right? In this connection, we think that the original motion is more balanced and allows more options to all social strata and enable members of the public to make the right choice warranted by their own circumstances.
Here, the Liberal Party urges the Housing Authority to reconsider its scheme to offer public housing units for sale and to work out some arrangements more attractive to sitting tenants. Many times in the past, the Liberal Party, acting on our own initiative, lobbied the Government and the Housing Authority to accept our suggestion to sell public housing units to sitting tenants at a price equal to the original construction cost plus interest, that is, at a price equal to 100 times the monthly rental. The proceeds from the sales can be re invested in building more public housing units and HOS housing units for those who need them badly and for the eligible applicants on the Waiting List for years. It is hoped that more could have their dream of resettlement achieved.
We think that the Housing Authority should not abandon the public housing sales scheme simply because the sales have so far not been successful. The problem with the past sales is that too much thought was given to pricing, while the more important consideration with regard to what price level would be acceptable to prospective buyers was neglected. In fact, the success of such a sales plan hinges on commercial considerations. If the price is not attractive enough to the prospective buyers, that is, the sitting tenants who are paying low rents, or if there are harsh restrictions on resale, no deals will be made.
Last night, a Mrs LI from the Kwai Fong Estate rang me up and wanted me to make a point today to the effect that there must be rental public housing units made available for the elderly who could not afford HOS housing units. It is of course my inescapable obligation to put forward such a point. This reminds me of one thing. In a private residential building, there are rental units as well as owner-occupied units. Where a public housing estate is offered for sale, the same arrangement could be made. The Housing Authority is known to be worried about management problems. It may get the idea from the private sector and see how similar problems are overcome in private residential buildings. The Liberal Party is in process of compiling cases of successful sales of public housing in the United Kingdom. Meanwhile, our discussions with the Housing Authority will continue, until a feasible equation is found for the successful sale of public housing units.
2082 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
At this point, I would like to make a passing comment on housing for the elderly. As everybody knows, this is a serious problem. There are 21 300 applicants on the Single Persons Waiting List. Just over 4 000 of them are old people. Considering that there are 790 000 old people in Hong Kong who are aged 60 or above, we have a very serious problem. We hope that different government departments, such as the Housing Department and the Social Welfare Department, will show more initiative in helping the needy elderly to move into public housing units. We also hope that facilities catering for the needs of the elderly could be made available in the public housing estates and that old people, when assigned public housing units, will be resettled in estates near where they now live.
Mr President, with these remarks, I support Dr Conrad LAM's original motion.
MR HUI YIN-FAT (in Cantonese): Mr President, the most controversial part of the Report on the Mid-Term Review of the Long Term Housing Strategy is one of its revised objectives, that is, the encouragement of home ownership to accomplish the undertaking made by the Governor in his 1992 policy address that the territory'ss home ownership rate should rise to about 60% by 1997. However, if the present rate is taken as an indicator, to meet the target, tremendous efforts must be made to achieve the spectacular increase in the home ownership rate for the coming years. Should the speculative activities in private property market not be curbed and the unoccupancy rate not be rectified, it is inevitable that the Housing Authority has to make radical changes to its existing policies so as to achieve the above-mentioned target.
Home ownership is a long cherished aspiration that Hong Kong people are working for and it is a major impetus to push our community forward. Unfortunately, prices of private property have been pushed to such a high level, thanks to speculation, that many nucleus families find them unaffordable. Even those sandwich class people who obtained home purchase loans from the Housing Society last year were unable to make the down payment and meet the renovation bill due to the spiralling property prices. The loans indeed did not make much difference. As for families who meet the income requirement and are eligible to apply for the Home Ownership Scheme (HOS) flats with white application forms, their successful rate is rather slim. They have no alternative but to wait. The amount of loan offered by the Housing Authority under the Home Purchase Loan Scheme is too small to achieve any practical purpose. As for the Sale of Flats to Sitting Tenants Scheme, it is finally shelved as its terms are not attractive enough. Still, one must not lose sight of the fact that we still have over 100 000 families on the Waiting List for public housing. They cannot afford to buy their own flats; yet they should not be deprived of their basic right of enjoying decent accommodation either.
In a nutshell, I hold that unless the target rate of home ownership is lowered, the Housing Authority has to revise its existing construction plans and
HONG KONG LEGISLATIVE COUNCIL — 26 January 1994 2083
related policies. However, in view of the short supply in respect of both flats for sale and for rent, how should we decide on the allocation ratio? Being a member of the Housing Authority, I would like to seek the views of honourable colleagues in this Council and interested parties.
The mid-term review carries an important recommendation, that is, to put some newly completed harmony type public housing units on sale with Comprehensive Development Programme tenants, squatter and Temporary Housing Area clearees and prospective Waiting List applicants due for flat allocation as major target buyers. In view of the quality of the flats, their prices and the target group of buyers, we may refer them as "alternative HOS flats".
I understand from my contact with the public housing tenants and relevant organizations that many tenants express interest in buying such flats. But the crux of the problem is whether or not the Housing Authority is willing to recover no more than the redevelopment costs and take up the responsibility of maintenance. As a matter of fact, the failure of previous Sale of Flats to Sitting Tenants Scheme was mainly due to the fact that the above-mentioned questions were still in the air. I hope that the Housing Authority will draw lessons from this blunder and seize this opportunity to provide the public with more home ownership choices. I have to stress that it must be ensured that the target group of buyers for the "alternative HOS flats" should be given the right to make their decision. In other words, should the sitting tenants decide not to buy such flats or if the prospective tenants on the Waiting List insist on rental housing, their decision should be honoured and not be reversed by any administrative rules. Otherwise, one may take it wrongly that the Housing Authority is compelling them to accept the new arrangement.
Apart from this, I propose that we may borrow the idea of the Building Cooperative Society scheme, which is a vogue in Mainland China in recent years, to help solving the housing problem of our middle-income families. Individuals or corporations may raise funds to build flats. Since such flats are not built to make profits, their prices are certainly far lower than those of the comparable housing on the property market. The Government only has to play a limited role on that front, such as to grant land at a cost which covers land formation only to the cooperative societies and serve as a guarantor so that the societies may secure low interest loans with the banks. The societies are self-owned, self managed and self-utilized cooperative organizations. This is an added advantage in the sense that there would be higher degree of care and participation on the part of their members. The scheme has proved a success in Mainland China. If promoted in Hong Kong, I believe that the scheme will be particularly effective in suppressing property prices; at least it could relieve pressure on the Housing Authority to put public housing on sale.
Mr President, I always hold that with limited resources, it is imperative that the Housing Authority should put it high on its agenda to look after those prospective tenants on the Waiting List whose living environment calls for urgent improvement. Having said that, one must not lose sight of the fact that
2084 HONG KONG LEGISLATIVE COUNCIL — 26 January 1994
the promotion of self-ownership could help stabilizing the community in the latter half of the transition period. I hope that Members of this Council and community groups may strike a balance between the two so that the Housing Authority's resources could be put to more effective and optimum use.
These are my remarks.
MR TAM YIU-CHUNG (in Cantonese): Mr President, the debate on the housing policy has so far centred around the controversy over whether the policy should be oriented by rental public housing units or by saleable units. While rental units and saleable units can respectively meet people's demands which are at different levels, they cannot reflect directly the affordability of different strata of people. In reviewing its housing policy, the Government often tends to draw an equal sign between demand and affordability. The housing policy, as a result, has been leaning more and more in the direction of offering public housing units for sale, thus charting a deviated course. Consequently, the housing policy fails to provide secure homes to the general public, and increasingly so.
It is an indisputable fact that the general public's home ownership aspiration is growing ever stronger. This reflects partly economic development has raised people's demand for quality of life. But this increased demand reflects at the same time that expenditure on housing features more strongly in people's cost of living and becomes a hidden worry for them. Let us use some figures to quantity this worry. At present, our median wage is $7,000 a month. But a 400 sq ft flat in the urban area, with room only for two people, may fetch somewhere between $1 million and $2 million and rent for $7,000 or $8,000 a month. The cost of housing has become a suffocating burden on the average member of the public. The kind of restlessness that comes as a result of this burden is also felt by us on a day-to-day basis. This kind of feeling is most evident among the young people, particularly those who have just formed their own families or who are planning to do so and those non-home owners living in private buildings. Their aspirations for home ownership are very strong. But this troubled feeling and their aspirations for home ownership do not amount to affordability to purchase their own homes.
Therefore, the Government is greatly exaggerating people's affordability of home ownership if it equates the aspiration with affordability. If increasingly market oriented housing policy of putting more and more public housing units on sale has been set against this background of exaggerated affordability, then our housing policy will never be of help to the really needy.
In fact, the same person with a strong aspiration for home ownership may also have a pressing need for a public rental housing unit. So we cannot say that since aspiration for home ownership has risen, there must be a corresponding reduced demand for public rental housing. The two demands are not mutually exclusive. What is more, I believe that they do overlap to a very large extent.
No comments yet.
Private notes are available after approval.