ENG-1994-06-15 — Page 1

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4269 OFFICIAL RECORD OF PROCEEDINGS

Wednesday, 15 June 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.

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

THE HONOURABLE SZETO WAH

THE HONOURABLE TAM YIU-CHUNG

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

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

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

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

THE HONOURABLE MRS PEGGY LAM, O.B.E., J.P.

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

4270 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

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 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

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

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

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4271

THE HONOURABLE JAMES TO KUN-SUN

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

ABSENT

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 RONALD JOSEPH ARCULLI, O.B.E., J.P.

THE HONOURABLE MOSES CHENG MO-CHI

THE HONOURABLE SIMON IP SIK-ON, O.B.E., J.P.

DR THE HONOURABLE PHILIP WONG YU-HONG

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

4272 HONG KONG LEGISLATIVE COUNCIL ― 15 June 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 NICHOLAS NG WING-FUI, J.P.

SECRETARY FOR CONSTITUTIONAL AFFAIRS

MRS RACHEL MARY BEDFORD CARTLAND, J.P. SECRETARY FOR RECREATION AND CULTURE

THE CLERK TO THE LEGISLATIVE COUNCIL

MR RICKY FUNG CHOI-CHEUNG

THE DEPUTY SECRETARY GENERAL

MR LAW KAM-SANG

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4273 Papers

The following papers were laid on the table pursuant to Standing Order 14(2): Subject

Subsidiary Legislation L.N. No. Land Registration (Amendment) Regulation 1994......................................... 353/94

Merchant Shipping (Fees) (Amendment) (No. 2)

Regulation 1994 (Amendment) Regulation 1994 ................................... 354/94

Immigration (Anchorages and Landing Places)

(Amendment) Order 1994....................................................................... 355/94

Immigration (Anchorages and Landing Places)

(Amendment) (No. 2) Order 1994 .......................................................... 356/94

Pleasure Grounds (Regional Council) (Amendment)

Bylaw 1994............................................................................................. 357/94

Pleasure Grounds (Regional Council) (Amendment) (No.

2) Bylaw 1994 ........................................................................................ 358/94

Construction Sites (Safety) (Amendment) (No. 2)

Regulation 1994 (L.N. 221 of 1994)

(Commencement) Notice 1994 ............................................................... 359/94

Employees Retraining Ordinance (Amendment of

Schedule 2) (No. 7) Notice 1994 ............................................................ 360/94

Oral Answers to Questions

Manipulation of land prices

2. MR FRED LI asked (in Cantonese): On 26 May 1994, there was a public land auction and a consortium of more than 10 property developers acquired two government land sites at a price below the market value. In this connection, will the Government consider formulating long-term and short-term policies (including amending existing laws or introducing new legislation) in order to prevent property developers from forming an alliance to manipulate land prices, monopolize the property market and stockpile land resources so as to

4274 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

push up the prices of private housing for sale to the general public, thereby jeopardizing the consumers’ interests?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, the recently announced review of the arrangements for land disposal will be completed before the next auction at the end of July.

It is too early to say what outcome of the review will be; but its purpose is to ensure that the principle of fair and genuine competition which underpins the land auction system is unimpaired.

I do not think we should assume that the prices achieved at the recent auction were below market value. They were within the Government’s expectations.

MR FRED LI (in Cantonese): Mr President, the Government’s reply is fairly brief. The review to be conducted is a response to the way a consortium of property developers overtly employed to jointly acquire land sites at the land auction on 26 May. The purpose of this review is to ensure that the principle of fair and genuine competition is unimpaired.

Will the Government inform this Council specifically whether the review is brought about by its conclusion, drawn after going through the procedures of the auction, that a certain crisis has emerged and impaired those principles?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, we are certainly reviewing the auction system because of a perception in the community that at the auction referred to there might have been something amiss. The perception is such, and the reality is of course I do not wish to anticipate the outcome of the review. The auction system has of course served us well for many years, but we do recognize the need at this point to conduct our review.

MR ALBERT CHAN (in Cantonese): Mr President, the Secretary said in the third paragraph of his main reply that the prices achieved at the auction were within the Government’s expectations. However, I wish to point out that a land site put up for sale by San Miguel after 26 May was acquired by Wheelock and Co at a price much higher than that offered by the consortium of property developers. Will the Government regard the practice that more than 10 property developers joined hands at two auctions within one day as unfair and immoral? Many countries already have their own antitrust legislation, in view of such and the painful experience suffered, will the Government reconsider introducing anti-monopolization legislation to prevent the market from being controlled by consortiums?

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4275

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, it is always dangerous to compare the results of two auctions, particularly in the case referred to by the Honourable Member where one took place in Fanling and the other in Sham Tseng. I would also like to make the point that there is nothing, certainly nothing illegal and nothing unusual, about groups of investors or developers forming a company or a consortium to undertake the development of some of our sites, which are of course in many cases very large and require very significant investment.

MR STEVEN POON (in Cantonese): Mr President, the Government has recently introduced a new package of measures to curb the rise in property prices, but, property prices have always been pegged to land prices. After each land auction, analysts will go about analyzing land prices in order to adjust the property price level. Will the Administration inform this Council whether it wishes to curb the risen in land prices so as to prevent the property prices from rising to an excessively high level in the future. What is the Government’s guiding principle for the policies concerning property prices, one of high land prices and high property prices, or one of low land prices, and low property prices?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, I am surprised that the Honourable Member asks me that question since I have repeatedly in this Chamber, on many occasions, confirmed that the Government does not operate a high land prices policy. Nor indeed does it operate a low land prices policy. It sells land at the full market value according to the state of the market at that time.

MR LEE WING-TAT (in Cantonese): Mr President, the second paragraph of the Secretary’s reply pointed out that the underpinning of our land auction system is the “principle of fair and genuine competition”, I think this principle should be publicized and known to all. Mr EASON believes that there is nothing unusual about groups of developers

forming a consortium to bid for land sites and I agree with him in this respect. However, Mr EASON did not point out that every property developer who has made a bid on that day was invited to join the consortium to create the kind of monopolization known as “cartel”. Will the Government explain, if what happened on that day was as usual as Mr EASON has described, why it suddenly proposed to invite three respected members of the community to look into the matter? If there was nothing amiss, why should an investigation be conducted?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, I think I have already explained a number of times. The points perhaps which I should repeat are that there is nothing in law or in principle to prevent investors joining hands to invest in Hong Kong. I am sure that outside

4276 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

the property market, it is something which is happening all the time and it is, of course, around the world, quite usual to have companies joining together to conduct investments. This is what has happened here and the reason why it happens in Hong Kong in the property sphere is because a development in terms of land costs and indeed construction costs can be quite expensive. And prices can be considerable. So in order to get the developments that we want and developments of a scale that we need to maintain production of flats at the level that we expect every year, we can expect investors to combine forces.

The reason why we are conducting the review, and I think this has been explained by myself and indeed by the Governor when he was in this Chamber last week, is to examine the arrangements we have in the light of certain perception within the community that there may have been something amiss. We are not, of course, at this stage confirming or acknowledging that something was amiss. We are responding to the community’s concern.

MR FREDERICK FUNG (in Cantonese): Mr President, according to the reports by some newspapers as well as the news reports on television, there were at first some biddings made by individual property developers, but after some discussions among themselves, some ten property developers joined together to make the biddings. Did the Government go through every detail to see if there were illicit transactions; and is the auction fully legitimate in itself?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, they were indeed, as the Honourable Member says, bidding. There was bidding in relation to both the sites which were auctioned on that day. As I understand it, after the two sites had been sold, those who were involved in the bidding and other companies decided to combine forces to undertake the development. As far as I am aware, there is nothing illegal in this and indeed the formation and disbandment of companies in relation to property development is something which is occurring all the time.

MR CHIM PUI-CHUNG (in Cantonese): Mr President, I think the people do not care about the property developers joining forces to form a consortium to bid for any government land site. Basically, this is a normal market, the problem, in fact, lies with “genuine competition”. Mr President, it was not uncommon in the past that property developers would make “private apportioning” after acquiring a piece of land, that is, they would acquire a land. site at a certain price and then sell it through private bids again. Will the Government inform this Council whether this practice is legal; and if not, what measures could be introduced to stop such practice?

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4277

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, I do not believe that the formation of joint ventures is illegal in Hong Kong.

Tram accidents

1. MR LAU CHIN-SHEK asked (in Cantonese): Will the Government inform this Council of the following:

(a) the numbers of traffic accidents involving trams, classified by their causes in each of the past three years; and

(b) whether legislation is in place to govern the training of tram drivers and tram safety on the road, including the speed and the functioning of the braking systems of trams; if so, what the relevant statutory requirements and monitoring mechanism are?

SECRETARY FOR TRANSPORT: Mr President, there were 130 tram accidents involving personal injury in 1991, 124 in 1992 and 126 in 1993. To put this in perspective, there were about 15 000 road traffic accidents in each of the past three years. Tram accidents therefore accounted for less than 1%.

As regards the causes of tram accidents, the police have advised that based on their investigations about 30% were due to pedestrian negligence, for example, jay walking, 8% due to driving at inappropriate speeds whilst about 10% were due to a variety of other reasons such as the non-observance of traffic regulations. It has not been possible to classify the causes of the remaining accidents because of the lack of information or evidence.

Section 38(1)(e) of the Tramway Ordinance (Cap. 107) provides for the Governor in Council to make regulations for the licensing of drivers. But no such regulations have ever been made and thus there is no legislative requirement for tram drivers to be licensed per se.

However under section 39(1)(e) of the Ordinance, Hong Kong Tramways Limited (HKT) has made rules relating to the training of tram drivers. The company provides a comprehensive eight-week training programme for its trainees, conducted by their experienced instructors who have had at least 20 years’ driving experience in trams. Tram drivers are also required to pass annual re-certification tests by the company and this includes a practical driving test and a refresher course covering safety matters and customer relations.

Trams operating on the roads are subject to the provisions of the Road Traffic Ordinance (Cap. 374). Under the rules made by HKT, tram drivers are not allowed to exceed a speed limit of 25km per hour in congested areas or

4278 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

when negotiating a bend. In any case, trams are not designed to go faster than 40 km per hour, which is well within statutory speed limits.

Under the Tramway Ordinance, the company is responsible for maintaining its tram cars and tracks in good condition, and conducting repairs where necessary to the satisfaction of the Director of Electrical and Mechanical Services (DEMS). The braking systems on all tram cars are checked by the company every 10 days under its preventive maintenance programme and this has to conform with the criteria laid down by DEMS. In the case of accidents, the braking systems are also checked and tested in the presence of EMSD staff. In the past three years, none of the trams inspected following accidents was found to have a defective braking system.

MR LAU CHIN-SHEK (in Cantonese): Mr President, the total number of registered vehicles in Hong Kong in 1993 was 500 000, among which, 163 or .0003% were trams. Yet tram accidents accounted for 1% of the traffic accidents in that year. Will the Administration inform this Council of the results of comparison between trams and other modes of public transport as regards the number of vehicles and the number of accidents? Has the Administration instituted any prosecution against the Hong Kong Tramways in the past three years for the tram accidents resulted from the company’s negligence? In addition, have specific safety enhancement suggestions been made to the company in the light of the causes for tram accidents that happened in the past three years?

PRESIDENT: Have you got all parts of that question, Secretary?

SECRETARY FOR TRANSPORT: Mr President, not even one accident is satisfactory and we should always try to prevent all possible accidents. As far as I am aware, following checks by both the police and EMSD, the tramway company has not been prosecuted because the causes for the accidents are not to be blamed on the company.

Insofar as improvements are concerned, the Hong Kong Tramways has a fleet of 160 trams. In the last year, one has been modified regarding its driving equipment. The technical term is that they have introduced a “chopper” control system which is designed to provide for smoother acceleration and deceleration of trams and a more effective braking system. This particular tram has not been involved in any accident. In addition, the tramway company has introduced better lighting systems, for example, braking lights and indicator lights, and have also replaced their former gong horns by air horns.

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4279

MRS PEGGY LAM (in Cantonese): Mr President, there are two types of trams operating in the world: the trams that run on tracks and the trackless trams. The trams in Hong Kong are those that run on tracks. They usually run slower and their tracks take up a portion of the road surface; track-replacement works, in particular, always give rise to traffic congestion. Will the Administration inform this Council whether consideration has been given to the introduction of trackless trams? If not, what are the reasons?

PRESIDENT: Are you in a position to answer that, Secretary?

SECRETARY FOR TRANSPORT: Mr President, there are no plans to introduce trackless trams in Hong Kong. Insofar as the maintenance of tram tracks are concerned, the company does inspect the tram tracks every evening through their own inspectorate staff and where necessary these tracks are repaired and replaced.

MRS MIRIAM LAU (in Cantonese): Mr President, the Light Rail Transit requires their drivers to have a private car driving licence and several years’ driving experience; but for trams, which also run on tracks, their drivers are not required to have any driving licence or experience. Will the Secretary for Transport inform this Council as to why there are different requirement standards.

SECRETARY FOR TRANSPORT: Mr President, I believe that the requirements for the Light Rail Transit is that a driving licence is a preference, and because there have been more applicants than the number of vacancies, they have been able to recruit drivers who have driving licences with at least two years’ experience.

Insofar as the tramway company is concerned, as I have said, there is no legislative requirement for the drivers to have licences but this is not a unique situation. Indeed my research has shown that, for example, in the United Kingdom, in Japan or in Singapore, neither the tram systems nor the mass transit systems there, nor the Mass Transit Railway Corporation and the Kowloon-Canton Railway Corporation, for example, in Hong Kong have licensed drivers. I think the need for regulation must be seen in perspective and we should not regulate just for the sake of it. For example, trams are unlike cars, one cannot just hop into one and take it out on any open road. Trams, in fact, because they follow the tracks, cannot overtake other tram cars and their speed limits are pretty limited. Given the overall safety record of the tramway company, I do not think licensing is required.

4280 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

MR LAU CHIN-SHEK (in Cantonese): Mr President, the first part of the question I raised just then was not answered, that is: How do trams compare with other modes of transport as regards the number of vehicles and the number of accidents? The Secretary for

Transport has just mentioned the tram services in other territories such as the United Kingdom and Singapore. May I ask the Secretary whether he has any figures which indicate the accident situations in these two countries?

SECRETARY FOR TRANSPORT: Mr President, the figures I cited earlier in my reply indicate that tram accidents account for about 1% of the total and I think Mr LAU himself said it was three out of 100 000 injuries. I think this is a fairly low accident rate, but of course this does not mean we should be complacent and the tramway company continues to try and improve their record. I do not have comparative figures for the other territories.

MR LAU CHIN-SHEK (in Cantonese): Mr President, I am not asking for a figure of the overall road traffic accidents. I am asking about the results of comparison between trams and other modes of public transport as regards the number of accidents and the number of vehicles.

PRESIDENT: Do you have the answer, Secretary?

SECRETARY FOR TRANSPORT: Mr President, I have a few statistics which I can indicate. For example, if we compare this with the number of accidents involving public buses, the corresponding figures are as follows:

in 1991 there were 1 404 accidents involving buses;

in 1992 the figure was 1 489; and

in 1993, 1 456.

MRS PEGGY LAM (in Cantonese): Mr President, just then the Secretary for Transport has not answered my question concerning the reasons for not considering the introduction of trackless trams. No tracks means no replacement or maintenance needs, traffic congestion can thus be minimized. In addition, trams did not use air horns in the past. They just gave out ringing sounds which the public, especially the elderly, were very used to. They would know a tram was approaching on hearing the ringing sounds. The ringing system has already been replaced by the air horn warning system, which has also become a source of complaint. Firstly, as the elderly are not aware that the horn warnings actually come from trams, they might sometimes fail to notice an approaching tram; Secondly, as trams start running in early morning, residents

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4281

along the tram routes are disgusted with the horn warnings, they believe that such noise would disturb their sleep. May I ask the Secretary for Transport whether the number of tram accidents has increased or remained the same since the foot gong was replaced by the horn warning system? If the number of accidents remained the same, would the original foot gong be restored?

PRESIDENT: I think as regards trackless trams, that was not part of the original question so I will not trouble you to answer that. But could you deal with the second part of Mrs LAM’s question?

SECRETARY FOR TRANSPORT: Mr President, as regards the second part, I agree with the Honourable Member that perhaps the ringing system or the foot gong is probably more pleasant to the ear and in the old days more pedestrians were used to this. But I think that it is perhaps really a question of choice. The tramway company has introduced the new air horns which are like car horns because they in fact draw more attention, and my understanding since, the introduction of the new air horn warning system, is that the number of accidents has actually fallen, albeit marginally.

Carrian case

3. MR JIMMY McGREGOR asked: Will the Government inform this Council of the cumulative cost to date of the series of actions taken relating to the prosecution against the former chairman of the Carrian Group of Companies, the estimated additional time required to bring the case to trial and the estimated cost of any further necessary action?

ATTORNEY GENERAL: Mr President,

(1) The former chairman of the Carrian Group of Companies has faced, or is currently facing, prosecution in three cases. The first of these involved alleged offences in respect of the Carrian Group of Companies. The trial of that case ended in 1987 although the proceedings were not formally concluded until May 1988. The trial of the second case, relating to Bumiputra Malaysia Finance Limited (BMFL), has now formally started under the Complex Commercial Crimes Ordinance. The third case involves allegations of corruption by senior executives in the Hong Kong branches of two overseas banks. The trial of that case is pending in the District Court and has been postponed until after the conclusion of the second case, that is “BMFL”.

4282 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

The total cost of the Carrian case was $91,546,984. The total combined cost to date of the second and third cases, which are still current, is $131,553,462. The cost of the Carrian case and of the BMFL case are in respect of all defendants and all proceedings.

(2) As regards timing, it is expected that the trial that has recently started, in respect of BMFL, will be concluded during the course of 1995.

(3) It is not possible to estimate the cost of any further necessary action. As I have said, the trial of one case has already formally started, and the trial of another case has been postponed until after the conclusion of the current trial. The cost of future action will depend on the course of those proceedings and it would not be proper for me to speculate in that regard.

Mr President, I would add this, that since the trial in respect of the BMFL case has started, the sub judice rule applies. I am sure that Members will appreciate and understand that I am anxious to avoid saying anything that might prejudice the integrity of that trial, or indeed any other related proceedings.

PRESIDENT: Before I take supplementaries, I shall just read Standing Order 18(g): “A question shall not reflect on the decision of a court of law or be so drafted as to be likely to prejudice a case pending in a court of law”.

MR JIMMY MCGREGOR: It seems clear to me, Mr President, that the overall cost of these cases to the Hong Kong taxpayers will not be less than $300 million. Mr President, considering that these cases involve the murder of one man, the suicide of another, the life imprisonment of another for murder, the trial and conviction of several more, the disgrace of prominent bankers and businessmen and the alleged fraudulent misuse of very large sums of money, would the Attorney General indicate whether he is resolved to seek to complete these cases with a high degree of urgency and seek priority through the courts so that justice can be done before 1997?

ATTORNEY GENERAL: Mr President, I am perplexed and dismayed at the reference to a murder case and to suicide and to other matters. I have described the charges that the former chairman of the Carrian Group of Companies is facing. Those do not include any of the matters to which Mr MCGREGOR has referred. I have been at pains in this case to pursue the prosecution with all expedition. It is, of course, a major and very complex commercial crime, probably one of the largest of its type anywhere in the world. It is, as I have said, extremely complex. I am as anxious as anyone that the trial which has now started should be concluded as quickly as possible. As I have indicated in my main answer, we expect the trial to be concluded some time in 1995.

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4283

MR TSO SHIU-WAI (in Cantonese): Mr President, the trial has taken more than a decade’s time and cost the Government several hundred million dollars of litigation charges. Will the Government inform this Council whether the prolonged trial and the large sums of public funds spent on litigation were brought about by the mistakes or errors it made while assessing the case at the early stage; whether it would be unfair to the community as well as the defendants in view of the time and public funds spent; and whether it was unnecessary to institute the prosecutions?

PRESIDENT: I think there were two questions. We had better take the first one. Your second is giving me some trouble.

ATTORNEY GENERAL: Mr President, the answer is no. These were prosecutions properly brought and properly carried through. Of course, the costs are very high indeed and Members will understand the reasons why that is so. I repeat that the prosecution of the BMFL case is of an enormous size and complexity and that is reflected in the time it has taken to bring it on to trial.

PRESIDENT: Would you repeat the second part of your question, Mr TSO? You are aware that Standing Orders provide that you should not seek an opinion, but what is an opinion and what is not is very much a matter of degree. Would you put your question again please?

MR TSO SHIU-WAI (in Cantonese): Mr President, I would like to ask the Government whether it could be regarded as fair to the defendants and the community as a whole when a large sum of public funds has been spent on litigation?

ATTORNEY GENERAL: Mr President, when allegations of an extremely grave nature, allegations of criminality are made, as in this case, it is clearly in the public interest that those allegations should be followed through and vigorously pursued in the courts. Not only because that is necessary to uphold the rule of law, but because of the necessity to preserve Hong Kong’s reputation as an international financial centre.

I have said, Mr President, many times and I will keep on saying, that you cannot put a price tag on justice because if you do so you begin to devalue the rule of law and that in the end serves nobody’s interests.

MR MARVIN CHEUNG: Mr President, would the Attorney General please advise this Council whether the two figures mentioned in his principal reply represents merely the cash paid by the Government for outside legal

4284 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

professional services or whether they include the cost of civil servants, such as members of the Attorney General’s Chambers, working on these cases and if so, how are those costs of the civil servants computed?

ATTORNEY GENERAL: Mr President, the figures represent, in relation to the Carrian case, the costs disbursed, that is, payments made to counsel prosecuting for the Crown, costs paid to the defendants, the cost of the committal proceedings and the cost of the Attorney General’s reference, taken in the autumn of 1987. Similarly in relation to the BMFL case, the costs cover the costs of hiring outside services. In neither case do the costs include the cost of, what I might describe as in-house government services, that is, counsel within my Chambers, time of the police, ICAC and others.

Sorry, Mr President, in deference to Mr Marvin CHEUNG, I have not quite answered the second part of his question. I think it is not possible at this stage to compute those.

DR TANG SIU-TONG (in Cantonese): Mr President, as the Carrian case is not yet concluded after 10 years’ time, could the actions taken by the Government be regarded as proper in view of the situation of the creditors and shareholders of the Carrian Group? From whom could the small shareholders concerned claim compensation for their loss?

PRESIDENT: Are you able to answer that, Attorney General?

ATTORNEY GENERAL: Mr President, as I had hoped to make clear in my main answer, we are talking about two separate cases. The Carrian case concluded in 1987 and formally would up in May 1988. The current case is the case involving Bumiputra Malaysia Finance Limited, BMFL.

MR JIMMY McGREGOR: Mr President, can the Attorney General say whether he was satisfied with the results of the case against Mr Lorrain OSMAN, and whether Mr OSMAN has agreed to return to Hong Kong to give evidence in other cases?

ATTORNEY GENERAL: Mr President, I do not think it is for me to be satisfied or otherwise as to the outcome of any particular case. It is not the role of an Attorney other than to present a case to court as a Minister of Justice. It is for the courts to decide on guilt or innocence.

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4285

As to the second part of the question, Mr President, I hope Mr McGREGOR and Members will forgive me if I do not get drawn into that. I do not want to get drawn into matters that might affect the current trial.

Container truck drivers’ strikes

4. MR LEE WING-TAT asked (in Cantonese): With respect to the container truck drivers’ strikes at the Hong Kong border in recent years, will the Government inform this Council:

(a) whether it knows the reasons for the drivers’ strikes and what those reasons are;

(b) whether the Government has received complaints lodged by the drivers against corruption involving Chinese customs officers at the border checkpoints; if so, how these complaints are handled;

(c) what channels are available at present for the drivers to reflect their difficulties and make suggestions to the Chinese authority; and

(d) what measures can be adopted to reduce the serious congestion and even traffic standstill at the border caused by the strikes of container truck drivers?

SECRETARY FOR TRANSPORT: Mr President, there have been five strikes by container and goods vehicle drivers at the border since June 1992. The main reason invariably has been the slow processing time by either the Hong Kong or Shenzhen border control staff. I have tabled a summary of these five cases.

Although allegations of corruption on the Chinese side of the border have been reported in the media, no such complaints have been lodged with the Administration by drivers. However, one complaint was received by the Independent Commission Against Corruption earlier this year regarding solicitation to expedite customs clearance. I understand that no further action was taken because the complaint was anonymous.

On our side, we obtain feedback from drivers through informal contact with staff of the police, Immigration, Customs and Excise and Transport Departments. In addition, the Transport Department holds quarterly consultative meetings with representatives of the trucking industry. Matters raised with us, which relate to cross-border issues and are of mutual concern, are reflected to the Chinese authorities through our border liaison channels. Drivers can also reflect their views direct to the Chinese authorities, through the representatives of trade unions and fleet owners’ associations who have contacts with the Chinese side.

4286 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

I believe that the most practical way of preventing strikes and thus minimize traffic congestion or standstill, is to improve and strengthen the channels of communication with container and goods vehicle drivers so that speedy action can be taken to resolve legitimate grievances and complaints. With this in mind, following the strike last month, the present arrangements have been strengthened by the establishment of bimonthly tripartite meetings on cross-border matters amongst the drivers’ representatives, Shenzhen and Hong Kong authorities.

Annex

Drivers’ strikes at the border

Date Control point Duration Reasons

(1) 26 June 92 Lok Ma Chau 2 hours Complaints about frequent inspections by Hong Kong

customs officers.

(2) 29 June 92 Man Kam To 3 hours Complaints about the reduction of the number of

processing channels and the

slow processing rate on the

Hong Kong side.

(3) 16 July 93 Man Kam To 3 hours Complaints about the slow processing rate on the Hong

Kong side.

(4) 23-24 July 93 Man Kam To, 30 hours Allegations of Lok Ma Chau corruption and slow and Sha

Tau Kok processing rate on

the Chinese side.

(5) 10-11 May 94 Lok Ma Chau 27 hours Complaints about the slow processing rate on the Chinese

side.

MR LEE WING-TAT (in Cantonese): Mr President, the Secretary said in the second paragraph of his reply that there was an allegation of corruption against the control staff on the Chinese side of the border this year but no further action was taken because the complaint was anonymous. I am disappointed to hear that

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4287

because everyone who understands how the trade operates will know that a container truck driver dare not disclose his real name in any complaint for fear of revenge or adverse effect on his business. I would like to ask whether the Transport Branch would consider spreading the message among container truck drivers and encourage them (certainly the Secretary should not disclose the identity of the complainants) to speak to the Hong Kong Government on matters of corruption and cross-border arrangements, so that the Administration can refer the matter to the Chinese counterparts for investigation or appropriate joint actions.

SECRETARY FOR TRANSPORT: Mr President, certainly, if there are any allegations or instances of corruption on our side of the border raised against departmental staff, follow up action will be taken. Insofar as referring allegations of corruption on the Chinese side, if we hear of these, these are taken up through normal border channels and through diplomatic channels. We certainly encourage the drivers to speak to our staff so that we can understand what the problems are, and as I have said, if these are of mutual concern we will gladly pursue these with our Chinese colleagues and counterparts. Certainly, if there are complaints and if the complainant asks to remain anonymous, we will respect this request. Our attempt and our aim is to improve cross-border flow.

MR LAU WONG-FAT (in Cantonese): Mr President, a strike staged by container truck drivers, regardless of its reasons, would inevitably cause inconvenience to residents of the areas concerned and, if situation worsens, could even cause social disorder. Will the Administration inform this Council whether there is any law in place that prohibits drivers from parking their vehicles on the roads in any manner they like? If so, has the Administration invoked the relevant legislation to institute prosecution against those drivers who deliberately parked their vehicles on the roads in contravention of the traffic rules? If not, will the Administration consider imposing control through legislation?

SECRETARY FOR TRANSPORT: Mr President, illegal parking is an offence under the Road Traffic Ordinance and the police do take follow-up action when a case has been established. In this particular case regarding the latest strike at the border, the police have investigated and are continuing to investigate some of the complaints. To date, no prosecution has been taken.

MR TIK CHI-YUEN (in Cantonese): Mr President, one can see from the annex tabled that a number of strikes staged in the past were related to the slow processing rate on the Chinese side. In addition, according to our observation, before each incident took place, signs which indicated that a strike was in the making could always be observed, such as prolonged queueing time for vehicles or ample complaints lodged by drivers with the authorities concerned. Did the

4288 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

Administration notice any such signs prior to each strike? And under the existing arrangement, will the administration liaise with the Chinese side to look for ways to resolve the problem once it is aware that a strike might be forthcoming?

SECRETARY FOR TRANSPORT: Mr President, indeed, on the last two occasions in particular when the strikes lasted for more than 24 hours, there were signs that the drivers were dissatisfied with various arrangements for cross-border traffic flow, the main one being the time taken to actually go through the border. When our staff at the border ― the police, the Immigration, Customs and Excise, and Transport ― detect such signs, we enter into dialogue and we consult the drivers’ representatives here to see what their complaints are and how these can be resolved and we do take this up immediately with our Chinese colleagues through the cross-border liaison channels. We will continue to do this and try and improve the situation.

The last strike, primarily, was caused by changes in the system. Apparently there were some teething problems on the Chinese side of the border but these have now been resolved.

REV FUNG CHI-WOOD (in Cantonese): Mr President, amongst the five strike actions, the first three were related to the inspections conducted by our customs officials and lasted for only two to three hours. But the latest two which were directed against the slow processing work on the Chinese side lasted for 30 hours and 27 hours respectively. It seems that the problems with the Shenzhen customs are more difficult to resolve. The Secretary has said that a meeting comprising representatives of the drivers, the Shenzhen as well as the Hong Kong authorities would be conducted to resolve the problems. In what ways do such

“tripartite talks” differ from the previous arrangements? Are these new arrangements really effective?

SECRETARY FOR TRANSPORT: Mr President, the difference in the latest arrangements is that for the first time, the drivers will actually meet both the Hong Kong Government officials and the Chinese officials at formal bimonthly meetings; hitherto there were no such formal avenues for communication.

MR WONG WAI-YIN (in Cantonese): Mr President, I understand from the timetable that five strikes happened in June 1992, July 1993 and May this year, almost one strike every 12 months. The two occasions which took place in Man Kam To, Lok Ma Chau as well as Sha

Tau Kok in July last year and in Lok Ma Chau this year, in particular, lasted for more than 24 hours. The reply given by the Secretary that matters would be taken up through the cross-border liaison channels sounds all too familiar. Nevertheless, when we look back, five strikes had occurred in the last two years, which means almost a strike a year, with the

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4289

one in Man Kam To, Lok Ma Chau and Sha Tau Kok last year that lasted for 30 hours being the most serious of all. I would like to ask the Administration what achievements have been made through liaison with the Chinese side over the past two years, particularly last year? Why did similar strike actions continue to happen? Is it that nothing has been achieved?

SECRETARY FOR TRANSPORT: Mr President, I certainly do not agree with the last observation. I think the liaison has helped and in fact various earlier problems have been resolved. I think when it comes to cross-border or indeed any arrangements which two countries or two parties have to deal with, we can only make suggestions. Where it concerns the activities or the arrangements or the conditions on the other side, it must be left to the other authorities concerned.

Having said that, of course on our part we have tried to open more border crossings. We have, for example, asked for the opening of the border at Lok Ma Chau for 24 hours and the Chinese, in principle, have been receptive to this idea and we hope that in autumn this year, this can be achieved so as to speed up traffic flow.

Dissolution of the Legislative Council

5. MISS EMILY LAU asked (in Cantonese): As the Chinese Government has repeatedly stressed that the Legislative Council would be dissolved on 1 July 1997, will the Government inform this Council what legal, political, economic and social impact such statements have made on Hong Kong?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, the British Government is fully committed under the Joint Declaration to ensure a smooth transfer of the Government in Hong Kong in 1997. It is also the clearly expressed wish of the community that there should be a smooth transition. This is why we have put forward electoral arrangements for 1994-95 which are, in our judgement, consistent with the Joint Declaration, the Basic Law and past agreements between Britain and China, and are therefore capable of continuing after 1997. We see no reason for China to do away with these arrangements in 1997.

MISS EMILY LAU (in Cantonese): Mr President, the Government said that it could not see any reason for China to abolish the electoral arrangements for 1994-95 in 1997. I do not understand why the Government “could not see” or could not even hear. Did the Government hear what QIAN Qichen said recently? QIAN did not say those words to the British Hong Kong Government in person, could this be the reason that caused the Government to say that it does not hear and does not see, as well as to trivialize the message sent? However, to

4290 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

many Hong Kong people, the message is by no means trivial! As such, will the Secretary inform this Council whether there is evidence to prove that the Chinese Government will not dissolve the Legislative Council in 1997? On top of that, Mr President, I hope that Government would start studying with the general public, should the Legislative Council be dissolved at this final stage of the transition period, the possible effects that might befall the social, political and economic aspects of Hong Kong. Will the Government proceed to discuss this issue with the public?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, I have explained in my main reply why the Government sees no reasons for China to dismantle the Legislative Council in 1997, but, if they were to do so, it is not at all clear how that would be in Hong Kong’s or indeed China’s interests. It is the well expressed wish of the community that there should be a smooth transition. Dismantling a Legislative Council which is openly and fairly elected, can hardly be conducive to a smooth transition.

As regards Miss LAU’s points about the impact of recent Chinese Government’s utterances on this subject, I would like to stress that we see no evidence of any impact whatsoever, and certainly not on our economic front. A few facts may help to put this in perspective. In the past decade or so, Hong Kong’s average growth rate has been some 6.5% and we are now the world’s eighth largest trading economy. There has been a growing interdependence between the economies of China and Hong Kong and we are now set to account for about two-thirds of foreign investment in China, and about a quarter of China’s exports go to or through Hong Kong. None of these has been affected by the disagreement with China on our constitutional development and also, the Chinese officials have said many times that they would not do anything which would hurt Hong Kong’s economic interests.

MR TAM YIU-CHUNG (in Cantonese): Mr President, the Secretary said that he saw no reasons, but I can tell him the reasons right now. China has in fact expressed quite openly that the three tiers of government will be recomposed on 1 July 1997 because China and Britain could not reach any agreement on the political reform issue; as the three-tier structure was implemented unilaterally by Britain, there can be no through train. Why does the Government keep, as was described by Miss Emily LAU, “hearing without listening and looking without seeing”? Did the Government say those things out of its own wishful thinking, or was it an attempt to mislead the public?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, I really have nothing much to add to my main reply; but it might be useful if I again just reiterate the key points and these are, we put forward our constitutional package with a view to ensuring a smooth transfer of government in 1997 and our arrangements, in our view, are in keeping with the Joint Declaration, the Basic

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4291

Law and agreements between the two governments. We just fail to see any reason why that should not be so and we fail to see why dismantling the package that we put in will be conducive to a smooth transfer of government in Hong Kong in 1997.

DR LEONG CHE-HUNG: Since the Administration believes that there is no reason for China to do away with the current arrangement in 1997 but yet China has repeatedly indicated that the Legislative Council will be dissolved by July 1997, could the Administration inform this Council whether Britain is seeking further discussion or otherwise on this smooth transition through whatever channel; and what would Britain do should China dissolve the Legislative Council in 1997, considering the fact that both Britain and China are joint signatories to the Joint Declaration?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, we have on numerous occasions, both during and outside the 17 rounds of talks, explained to the Chinese side why our proposed arrangements for the 1995 Legislative Council are fully capable of achieving continuity after 1997. We will certainly continue to explain our case through the various established channels.

As Members are well aware, China, of course, is a signatory to the Joint Declaration which is of course an internationally binding agreement, and so I very much believe that China will have full regard to its obligations under the Joint Declaration when considering whether the Legislative Council may ride the through train, including the obligation to ensure a smooth transition and the maintenance of Hong Kong’s stability and prosperity.

DR LEONG CHE-HUNG: Mr President, I do not think my question has been answered. My question is, what would Britain do if China does dissolve Legislative Council?

PRESIDENT: I suppose you are really asking whether this Government knows what the British Government will do.

DR LEONG CHE-HUNG: Mr President, then could the Administration seek Britain’s views on what they would do should China dissolve the Legislative Council in 1997, and inform this Council?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, if Dr LEONG were to look at my main reply he will find the answer there. I started off by saying that the British Government is fully committed under the Joint Declaration to ensure a smooth transfer of government in Hong Kong in 1997.

4292 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

And I also, in answer to his question, mentioned that China is a signatory to the agreement and therefore we are certain that China will take into account its international obligations before doing anything that is contrary to the Joint Declaration.

MR YEUNG SUM (in Cantonese): Mr President, just now the Government replied that it saw no reason why the Chinese Government would recompose the three tiers of government, it also mentioned the trend of economic growth. However, all these might be the good hope of the Hong Kong Government only. Will the Government admit categorically that if the Chinese Government deem it necessary to recompose the three tiers of government on 1 July 1997, neither the Hong Kong Government nor the British Government would be able to remedy?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, I must, again, repeat that I really have nothing further to add. I think in my main answer, as well as my supplementary answers to various Members, I think the picture is clear, I think the answer is obvious and I do not think I have anything more to add to my replies.

MR CHEUNG MAN-KWONG (in Cantonese): Mr President, the replies given by the Secretary so far are nothing but bureaucratic utterances. We should always prepare for the best as well as for the worst for any matter. As for this matter, it would really be in China’s interest should the Legislative Council be dissolved, because a new “China Brand” stove could then be built. China has repeatedly said that the Legislative Council would be dissolved after 1997, but the Government still insists that it “does not see nor hear” that. Is the Government not acting like a political ostrich now? Not preparing for the worst nor taking any appropriate measures with respect to the Legislative Council after 1997, would that be the things that a pragmatic government should do?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: I think, Mr President, by now Members will be bored by my repeated answers (Laughter) and I sympathize with Members’ boredom. Just again, two points: what are we trying to achieve with our electoral package? We want to ensure open, fair elections; we want to ensure a smooth transfer. And it is in that spirit, with that objective, that we put forward our package. We just fail to see why ― and no one has pointed out to us ― why that should not meet the criteria of openness, fairness and a smooth transition.

MR JAMES TIEN: Mr President, since the Secretary has nothing to add on any of the supplementaries, I probably should not ask any more. (Laughter)

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4293

MR HOWARD YOUNG (in Cantonese): Mr President, will the Secretary point out clearly that as the so-called “through train” issue is something created after the signing of the Sino-British Joint Declaration, and so whether or not there be a through train would be none of the Joint Declaration’s business? Secondly, is the Administration aware that the Basic Law does provide for the establishment of a Preparatory Committee in 1996, and that one of the Committee’s duties is to decide if it is necessary to repeal the laws that do not conform with the Basic Law. Does this mean that, whether or not they could be carried through 1997, the electoral arrangements to be passed two weeks later, would have nothing to do with the Legislative Council? Then, would any interference from the Legislative Council be regarded as an attempt to usurp the Preparatory Committee’s power; and would the Chinese and British Governments be viewed as back seat drivers if they meddle in this matter?

PRESIDENT: I think, Mr YOUNG, your question goes way beyond the original question and answer. And Members, of course, do not need reminding that the Second Reading of the bill comes up in two weeks. A lot of this is by way of anticipation. I think it is timely to move on.

Political and security investigations

6. DR TANG SIU-TONG asked (in Cantonese): Will the Government inform this Council:

(a) What are the legal powers of the Government to put the political activities of certain persons under surveillance or investigation; whether such powers are in conflict with the Bill of Rights Ordinance; and which department is responsible for such work;

(b) whether the Government has put the political activities of any public figures, pro China personages and senior government officials under surveillance or investigation in the past three years; and

(c) whether the Government has drawn up a so-called “target list” so that special attention can be paid to the activities and movements of its targets, and information about their political activities can be collected?

SECRETARY FOR SECURITY: Mr President, the Government does not engage in political investigations. When a security threat exists, investigations are conducted to counter that threat. The police are primarily responsible for conducting such investigations, though, depending upon the nature of the threat, other departments such as the Customs and Excise or Immigration Departments, may also be involved. All investigations are carried out in accordance with the law, including the Bill of Rights Ordinance.

4294 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

Details of security investigations are by their nature secret, but, as stated above, the Government does not investigate political activities. It has not drawn up any “target list” for such investigations.

DR TANG SIU-TONG (in Cantonese): Mr President, there is a clear distinction between political surveillance and security surveillance, while political investigations can sometimes be conducted through the application of security principles. Will the Government inform this Council whether it has, in the past three years, put any public figures, pro-China personages or senior government officials under investigation on security grounds; and whether the Independent Commission Against Corruption (ICAC) has been involved?

SECRETARY FOR SECURITY: Mr President, as I have said, details of these investigations must remain secret and I cannot answer specific questions like that.

MR ALLEN LEE (in Cantonese): Mr President, as the Administration does not conduct political investigations, will the Secretary inform this Council under what circumstances or upon what criteria will the Administration conduct investigations?

SECRETARY FOR SECURITY: Mr President, when I refer to security investigations or investigations into threats to security, I am talking about activities which by illegal means threaten the security of Hong Kong, and I stress the words “illegal means”. We are not under any circumstances talking about normal lawful political activities. And the police have ample powers to conduct such investigations conferred upon them by the Police Force Ordinance.

MR VINCENT CHENG: Can the Secretary inform this Council of the definition of a security threat or what does he see as a threat to Hong Kong’s security? What is Hong Kong’s security?

SECRETARY FOR SECURITY: Mr President, I think I have just answered that question but perhaps to give some examples, such activities could include terrorism, they could include nuclear-arms proliferation, they could include United Nations sanctions circumventions; there are many such activities.

MS ANNA WU: Will the Government inform this Council whether surveillance of political activities of a target list of 14 groups, including “SOCO”, “The Observers” and “The Heritage Society”, in the late 1970s and early 1980s, for assessment by the Standing Committee on Pressure Groups formed by the

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4295

Government, is considered to constitute political investigations; why such investigations were conducted; who conducted the investigations and under what legal authority?

SECRETARY FOR SECURITY: Mr President, this goes back a very, very long way, certainly well before my time. I will give a written answer to these questions. (Annex I) I have no information about these historical activities. (Laughter)

MS ANNA WU: Mr President, I am surprised that this is not within the recollection of the Administration, it certainly is within mine and I am one of the names made known in the reports on “The Observers”. It certainly is within my living memory.

PRESIDENT: Secretary, do you wish to respond?

SECRETARY FOR SECURITY: Mr President, I did not say it was not within the recollection of the Administration, I said it was not within my recollection. I will search out the memory of the Administration and, as I have said, give a written answer.

MR STEVEN POON (in Cantonese): Mr President, territory-wide concern has been aroused by the news story which claimed that the Government has been keeping under surveillance the activities of political figures and pro-China personages (including Ms Anna WU as well). The Secretary said in his main reply that the Government did not engage in any political investigation or surveillance but he did not say that the Government could not do so. In fact, the legal basis for the Government’s action is the provisions under the law. Will the Government inform this Council whether it will consider abolishing the authorized legal power under which the Government could monitor or intercept private telephone conversations, so as to prevent such power from being abused or used as a tool in political confrontation?

SECRETARY FOR SECURITY: Mr President, I believe that the questions on this were answered at length by Mr WOODHOUSE in this Council a few weeks ago. I have nothing to add to those answers.

MR CHIM PUI-CHUNG (in Cantonese): Mr President, although the Government does not engage directly in political investigation, some local political figures are still subjected to investigations of other nature. Will the

4296 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

Secretary inform this Council whether such investigations have absolutely nothing to do with politics?

SECRETARY FOR SECURITY: Mr President, I can only refer the Member to my main answer which I think fully covers that point.

MR JAMES TO (in Cantonese): Mr President, will the Secretary inform this Council whether the criteria for conducting the “security investigations” mentioned in his main reply would vary with time? To give an example, while Communists active in Hong Kong were once included as investigation targets decades ago owing to the unfavourable Sino British relations, today’s investigation targets, however, might be persons sent by other countries or governments to conduct activities in Hong Kong.

PRESIDENT: I do not think I caught the actual question, Mr TO.

MR JAMES TO (in Cantonese): Mr President, my question is whether the Government would adopt different criteria at different times. Has the Government been using, since decades ago, the same criteria to identify the circumstances under which Hong Kong’s security would be threatened? Who is in a position to threaten or undermine the security of Hong Kong?

SECRETARY FOR SECURITY: Mr President, no. I think I have said previously what I mean by security threats. These can and do sometimes include government-sponsored activities. For example, there are some governments that sponsor terrorism; there are some governments that seek to circumvent United Nations arms and other embargoes; and sometimes we do investigate those activities in Hong Kong.

MRS SELINA CHOW (in Cantonese): Mr President, in the Secretary reply, the last sentence of paragraph one says that all investigations are carried out in accordance with the law, including the Bill of Rights Ordinance, while paragraph 2 tells us that all these security investigations are conducted in secret. As such, how can we find out whether those investigations are conducted in accordance with the law and the Bill of Rights Ordinance? As all these investigations are conducted in secret, how is the Administration going to justify these actions?

SECRETARY FOR SECURITY: Mr President, all activities of this type must be carried out and are carried out in accordance with the law. So far as the Bill of Rights Ordinance is concerned, it provides that no one shall be subject to

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4297

arbitrary or unlawful interference with his privacy and all investigations that we carry out are lawful and are not arbitrary.

MRS SELINA CHOW (in Cantonese): Mr President, the Secretary has not answered my question. My point is, as all these investigations are conducted in secret, who is in a position to testify to the legality of these investigations?

SECRETARY FOR SECURITY: Mr President, I think the Administration has to be trusted to conduct such investigations. There are some things which must by their nature remain secret.

MRS ELSIE TU: Mr President, since I can confirm that this list existed ― I have seen it ― and it does have the name of “The Observers” and “SOCO” ― surprisingly enough, my name is not on it. (Laughter) But these activities were certainly not ― I am sure Ms Anna WU was not related to terrorism or nuclear-bombs. So I wonder when the Security Branch or the Government ceased to investigate that kind of activity and what was it investigating at that time?

SECRETARY FOR SECURITY: Mr President, as I said in answer to an earlier question, all this happened many years ago, certainly well before my time and well outside my memory. I will certainly give a written answer to those questions but I cannot answer them now. (Annex II)

Written Answers to Questions

Maternity protection

7. MR SIMON IP asked: In view of the fact that out of the 79 complaints in 1993 of unlawful termination of employment of female workers after application for maternity leave, only one case has ended in a conviction, will the Government inform this Council as to whether it intends to propose additional measures to strengthen maternity protection and to increase fines under the maternity protection legislation?

SECRETARY FOR EDUCATION AND MANPOWER: Mr President, of the 79 complaints referred to in the question, 41 were related to dismissal of female employees allegedly because of their pregnancy. The other complaints concerned provision of maternity leave pay, sickness allowance in respect of medical check-ups and other related entitlements under the Employment Ordinance or their employment contracts.

4298 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

All these complaint cases were investigated by the Labour Department. In 18 cases, the female employees had failed to serve notice of pregnancy as required by law. In six cases, the cause of dismissal was found to be unconnected with pregnancy. In eight cases, the evidence was found to be very inadequate or where there was no prosecution witness. In three cases, the employers had become insolvent. And in another three cases, the employers took prompt remedial actions and came to amicable settlement with their employees. In one case, the female employee was found not entitled to maternity pay. In another case, the employee’s entitlement to maternity leave pay was uncertain and is now pending a ruling of the Labour Tribunal.

The Government takes a serious view on maternity protection. We have proposed, under the Employment (Amendment) (No. 2) Bill 1993, to make late payment of maternity leave pay an offence. The 26-week eligibility period for maternity leave and the 40-week eligibility period for maternity leave pay are also clarified under the Bill.

As to the levels of penalties under the Employment Ordinance, the Labour Department has recently completed a review, and proposes that the maximum levels of fines relating to maternity leave provisions be substantially increased. The proposals are being examined and will be introduced into the Legislative Council as early as possible.

Caesarian section operations

8. DR HUANG CHEN-YA asked (in Chinese): In view of recent reports that the number of caesarian section operations performed overseas has exceeded actual need, will the Government inform this Council:

(a) of the rate of caesarian section operations per thousand births in public hospitals; and

(b) of the rate of such operations in private hospitals; if this is not available, whether there are plans to obtain the relevant information in order to monitor the situation in Hong Kong?

SECRETARY FOR HEALTH AND WELFARE: Mr President, the rate of caesarian section operations performed in public hospitals in Hong Kong was 143.11 per 1 000 births in 1992-93 and 141.33 per 1 000 births in 1993-94, which compare favourably with overseas countries. Similar statistical information in respect of private hospitals is not collected for the time being, but we will consider the possibility of obtaining such information from these hospitals.

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4299

Village patrol by the police

9. MR WONG WAI-YIN asked (in Chinese): Owing to the vast rural area and the narrow village roads in the New Territories, the police has to use motor cycles to perform patrol duties in the villages. Will the Government inform this Council:

(a) of the number of motor cycles currently made available for patrol duties in the rural areas of the New Territories; and

(b) whether there are plans to increase the number of motor cycles for such duties; if so, when the plans will be implemented and what is the increase in the number of motor cycles; if not, what alternative measures will be taken to step up police patrol in villages?

SECRETARY FOR SECURITY: Mr President,

(a) There are currently 64 motorcycles used for patrol duties in rural areas of the New Territories.

(b) The police have plans to acquire a further two motorcycles for use in the southern part of the New Territories later this year.

In addition to motorcycle patrols, mobile patrol vehicles are used in remote villages which can be accessed by road; bicycle patrols are also conducted in Yuen Long. All these are supplemented by foot patrols during weekends and public holidays, in response to the increased number of people visiting the New Territories. Members of the Field Patrol Detachment, who patrol rural areas along the border primarily to combat illegal immigration, also deal with other emergencies if necessary. The police monitor closely the crime situation in different parts of the New Territories, and deploy resources as necessary to cope with the situation.

Hospital Authority’s public relations and publicity expenditure

10. MR MICHAEL HO asked (in Chinese): Will the Government inform this Council of the establishment of the various ranks of officers in the department responsible for public relations and publicity work in the Hospital Authority, and the personal emoluments and other recurrent expenses of the department concerned in the current financial year?

SECRETARY FOR HEALTH AND WELFARE: Mr President, the publicity section together with the news section of the Hospital Authority Head Office is headed by a Deputy Director and staffed by two Chief Information Officers, three Senior Information Officers, one Information Officer, two Assistant

4300 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

Information Officers and two Clerical Officers. Their salaries at $4.86 million per annum are comparable to similar ranks in the Civil Service.

Separately, a total budget of $2.5 million has been earmarked by the Hospital Authority in the current financial year for public relations and publicity work.

Harbour safety

11. MR LEE WING-TAT asked (in Chinese): As the reclamation work being carried out in Victoria Harbour is causing the gradual narrowing of the fairway, will the Government inform this Council of:

(a) the number of accidents in Victoria Harbour involving vessels in the last three years (classified according to vessels registered in Hong Kong, China and other places);

(b) the measures adopted to ensure that inbound vessels registered outside Hong Kong will abide by Hong Kong’s maritime laws and observe fairway safety; and

(c) the measures in place to ensure that the safety of cross-harbour ferries will not be affected while they are berthing and that their berthing will not be delayed by the reclamation vessels operating near the ferry piers at Central District?

SECRETARY FOR ECONOMIC SERVICES: Mr President, a number of marine works are being undertaken in the harbour. None of these require narrowing of fairways. The number of accidents in Victoria Harbour over past few years is listed in the annex to this answer. The majority of the accidents are minor incidents involving only slight damage to vessels.

To ensure compliance with Hong Kong’s maritime laws by foreign-registered vessels when navigating within Hong Kong waters, the Marine Department’s Vessel Traffic Centre (VTC) monitors and communicates directly with these vessels. If a vessel is found not observing the regulations properly, the VTC will inform, advise and direct the vessel to adjust her movements. Non-compliance with such directions will result in prosecution.

As marine works are in progress near to ferry routes, special precautions have been adopted to ensure the safety of berthing ferries and that any delay to their schedules is minimized. These measures include:

(a) designation and promulgating specific areas within which only marine works are allowed;

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4301

(b) stepping up Marine Department patrols of the Central harbour by extending patrol hours and deploying additional launches. This is to ensure that vessels engaged in marine works do not anchor or operate outside the specified works areas;

(c) requiring all floating plant, when entering or leaving the Central Reclamation works areas, to follow a north/south course to and from the Central Fairway. This is to ensure that the ferries are not obstructed by crossing traffic; and

(d) continuous liaison between the Marine Department, marine works contractors and ferry operators so that rapid response can be initiated in the event of any unusual situations or occurrences.

Annex

The Number of accidents in Victoria Harbour

involving vessels in the last three years

No. of vessels involved in the collisions

Year

No. of

collisions

HK

licensed/registere d vessels

PRC

vessels Others

Total no. of vessels

involved

1991 66 72 36 24 132 1992 69 78 25 35 138 1993 104 109 51 48 208

1994

(up to

31 May 1994)

22 24 12 8 44

Staff appointment of tertiary institutions

12. MR CHEUNG MAN-KWONG asked (in Chinese): Regarding the renewal and termination of appointment of contract and permanent staff of tertiary institutions funded by the University and Polytechnic Grants Committee, will the Government inform this Council whether it is aware of the following:

(a) whether each institution has it own established procedure to explain to a staff member the reasons and details concerning the non-renewal of his contract, if the institution has no intention to renew the contract when it is due to expire soon; if so, what the procedure is and whether staff members are aware of such procedure;

4302 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

(b) whether there are effective and reasonable appeal channels for staff members to lodge appeal and defend themselves against the grounds given by the institution when their contracts are terminated;

(c) what arrangements similar to those in (a) and (b) the institution will make if a permanent staff member is dismissed; and

(d) how does the authority concerned monitor the entire procedure to ensure that there is no abuse of power and human errors, in order to prevent unfair treatment to staff members?

SECRETARY FOR EDUCATION AND MANPOWER: Mr President, the University and Polytechnic Grants Committee (UPGC)-funded institutions are autonomous statutory bodies. Under their respective ordinances, they are entitled to freedom of action, within the laws of Hong Kong, in managing their internal affairs, including the selection, renewal and termination of appointment of their own staff.

Having regard to the above, the Administration’s answers to Mr CHEUNG’s questions are as follows:

(a) the Administration understands that all UPGC-funded institutions have established procedures governing the appointment, renewal, non-renewal and termination of employment contracts for contract staff. These procedures vary from one institution to another in terms of details, due to their different historical backgrounds and management practices. But they share broadly the same principles which include appraisal of individual performance, notification to individuals in case of contract renewal, non-renewal or termination, and provision for appeals by staff. A staff’s terms and conditions of service are stated in the contract of employment and made known to him/her upon appointment.

(b) appeal channels are provided for in all institutions. Appeals are usually handled by a panel or committee in order to minimize possible abuse of power by any individual;

(c) while the detailed procedure may vary from one institution to another, similar arrangements exist in these institutions in respect of permanent staff; and

(d) the governing bodies of the institutions are ultimately responsible for ensuring that these established procedures are applied fairly and reasonably. Disputes about contracts of employment or the circumstances surrounding the termination or non-renewal of contracts may also be brought to the courts if a concerned party chooses to do so.

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4303 Resource Centre for Gifted Children

13. MR ERIC LI asked (in Chinese): With regard to Hong Kong’s first Education Resource Centre for Gifted Children to be established in Tsuen Wan, will the Government inform this Council:

(a) whether the Education Resource Centre can be completed for use this year as scheduled; if not, what are the reasons; and

(b) if the Education Resource Centre for Gifted Children cannot be established at the above-mentioned location, where will the Government establish such Centre; when will it be completed and what construction cost will be incurred?

SECRETARY FOR EDUCATION AND MANPOWER: Mr President, the site at the present Tsuen Wan Government Secondary Technical School has been provisionally earmarked for the establishment of the first Resource Centre for Gifted Children. Lately, however, there have been other considerations including whether the site should be used for residential housing. A decision on the final use of the site will be made soon.

If the decision is to proceed with the Resource Centre for Gifted Children on the present site, we expect the centre to open in March 1995, following extensive conversion work at an estimated cost of $6.8 million. On the other hand, if an alternative site is to be found, the timing for the opening of the centre and the cost involved will depend on the condition and location of the new site.

English-speaking mentally handicapped children

14. MR ERIC LI asked (in Chinese): Will the Government inform this Council of the following:

(a) the total number of English-speaking mentally handicapped persons aged fifteen and below in Hong Kong as at April 1994;

(b) the number of school or training places the Government has provided for the English-speaking mentally handicapped persons aged between four and fifteen in the 1993-94 academic year, and the distribution of such persons in each grade;

(c) the number of new school places the Government will provide in the 1994-95, 1995-96 and 1996-97 academic years respectively for these English-speaking mentally handicapped persons who are of school-age; and

4304 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

(d) in the long term, what time frame the Government has planned to solve completely the problem of insufficient school places for the English-speaking mentally handicapped persons?

SECRETARY FOR EDUCATION AND MANPOWER: Mr President,

(a) As at April 1994, the number of English-speaking mentally handicapped children aged 15 and below is estimated to be about 147.

(b) Special education for English-speaking mentally handicapped children of school age is provided in schools run by the English Schools Foundation (ESF) which receives subvention from the Government. There are two special units each at the primary and secondary level, with a total capacity of 84 places for children with special needs. In addition, the Jockey Club Sarah Roe School of the ESF provides places for 40 severely mentally handicapped English-speaking children. Details are as follows:

Enrolment

Capacity Mentally handicapped

Other

handicaps

Special units of ESF

schools

Sarah Roe School

Secondary (11-18)

Primary (5-10)

Primary and

secondary

42 27 5

42 41 1 40 29 0

Total 124 97 6

(c) and (d)

The Education Department is aware that there is a waiting list of 24 handicapped children for places in the ESF schools. Based on the number of children now attending special child development centres, the department estimates an additional demand of another 26 places in the next few years. To cope with this additional demand, the department is discussing with the ESF regarding plans for expansion, and will also be exploring with other agencies the possibility of alternative or additional provision.

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4305 Alleged indecent assault by doctors and dentists

15. MISS EMILY LAU asked (in Chinese): In view of recent media reports on several cases concerning indecent assault of female patients by their doctors and dentists, namely a doctor of the Police Training School being charged with indecent assault of several recruit woman police constables, a doctor being alleged to have indecently assaulted a female patient who is an employee of an airline and a dentist practising in Hong Kong having previous conviction of indecent assault of his female patients in Canada, will the Government inform this Council whether:

(a) it is aware of the above-mentioned cases and whether the details of those cases can be disclosed to this Council; and

(b) it will suggest to the medical profession to stipulate that examination of female patients by male doctors or dentists must be carried out in the presence of female nurses?

SECRETARY FOR HEALTH AND WELFARE: Mr President,

(a) The first of the three cases mentioned involved a doctor who was charged in the District Court with six counts of indecent assault. The case was dismissed on 18 March 1994 after the Court found him not guilty of all charges.

The second case was considered by the Medical Council of Hong Kong, pursuant to the Medical Registration Ordinance (Cap. 161), at a disciplinary hearing held on 4 November 1993. After hearing evidence from the complainant and the accused doctor, the council was satisfied that the doctor was “guilty of improper, immoral or indecent behaviour in the course of his professional duties to his patient (that is, the complainant), and that in relation to the facts alleged he has been guilty of misconduct in a professional respect”. The council further ordered that the doctor’s name be removed from the medical register for six months, the application of which would be suspended for two years subject to the doctor not being found guilty of professional misconduct during the said period. Subsequent to the doctor’s recent decision to withdraw his appeal to the Court of Appeal, the Medical Council’s decision and disciplinary order were gazetted on 3 June 1994.

The third case was heard by the Dental Council of Hong Kong, in accordance with the Dentists Registration Ordinance (Cap 156), at its disciplinary enquiry held on 22 February and 21 April 1994. At the conclusion of the enquiry, the council was satisfied that the dentist in question was “convicted by the Supreme Court of British Columbia, Canada on 4 December 1986 of 17 charges of indecent

4306 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

assault and sexual assault; and that the Court of Appeal of British Columbia, Canada had on 23 September 1987 allowed the dentist’s appeal against sentence and imposed a sentence of imprisonment of two years less one day with probation for two years”. The council ordered as a consequence that the dentist be allowed to practise dentistry in Hong Kong with certain restrictions.

However, having subsequently consulted the Attorney General, the secretary to the Dental Council is now seeking a judicial review of the above order of the council and an Application for Leave to Apply for Judicial Review has already been filed. It would not be appropriate to divulge any further details of the case at this stage, pending determination of this application.

(b) The need or otherwise of a chaperon when conducting medical examinations on female patients is a matter for professional judgement depending on the patient’s clinical condition. Doctors should always be fully aware that they should obtain the consent of their patients before commencing any examination. It makes good common sense for male doctors to conduct a medical examination on a female patient in the presence of a chaperon if the examination to be carried out involves any direct body contact.

It should be emphasized that both doctors and dentists are required by their codes of practice to regard the interests of their patients as their first priority. If ever they are alleged of having disregarded their professional responsibilities to patients, they may be subject to the disciplinary sanctions of the Medical and Dental Councils respectively.

School sites

16. MR CHEUNG MAN-KWONG asked (in Chinese): Will the Government inform this Council of the following:

(a) the total number of sites reserved at present for the Education Department to build primary, secondary and special schools, the locations and areas of these sites and how they will be used in the future;

(b) how many of such sites are not occupied, the circumstances under which a decision will be made to invite tenders for building schools at such sites, and the circumstances under which a decision will be made to surrender a site;

(c) the number of additional sites that the Education Department estimates will be required to build a sufficient number of school

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4307

premises, if the arrangement of having floating classes at secondary schools is abolished; and the number of existing sites that can be made available for immediate use, so that they will no longer be left vacant;

(d) whether the reserved sites in various districts suitable for building primary schools can be fully utilized if whole-day primary schooling is to be implemented by stages; and

(e) how does the Education Department identify school sites; in respect of suitable school sites, whether any difficulties have been encountered in applying for the allocation of such sites; whether the Administration will give priority to the allocation of such sites to the Education Department for building school premises?

SECRETARY FOR EDUCATION AND MANPOWER: Mr President,

(a) There are at present 157 reserved school sites: 105 for secondary, 50 for primary and two for special schools. They are located in various districts (details at annex) and have been reserved to enable new schools to be built in the future to meet policy targets.

(b) A School Building Programme drawn up on the basis of student population projections and to meet approved education policies is reviewed annually. Within the resources allocated each year, new schools as recommended in the programme are built through public tender under the supervision of the relevant authority, using the appropriate sites reserved. Reserved school sites which are not needed because of demographic changes, site limitations and other physical constraints are surrendered.

(c) The current policy is to reduce floatation through an on-going school extension programme for schools of the old design. This programme has recently been reinforced by the School Improvement Programme introduced this year. Together these two programmes would help to eliminate floating classes at Secondary I to Secondary V levels by the year 2000. The Government considers the floating of classes at Secondary VI to Secondary VII levels to be reasonable, having regard to their frequent use of special rooms for different subjects.

If floating classes at Secondary I to Secondary V levels were to be completely eliminated well ahead of the year 2000, 19 additional secondary schools would be required. Suitable sites for these schools would have to be made available from the reserved list.

4308 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

(d) It is the Government’s policy to encourage primary schools to operate on a whole-day basis where possible without adversely affecting the supply of school places. There are 132 whole-day primary schools for local children including three new schools commissioned in 1993.

If whole-day schooling were to be implemented in all primary schools, it is estimated that there would be a total shortfall of 87 primary school sites in 17 districts, even if all the reserved primary school sites which are needed are used.

(e) At an early stage of the town planning process, sites are reserved for schools and other community facilities in planning districts to meet forecast requirements. The number, size and location of school sites required are determined mainly with reference to population forecasts and approved planning standards and guidelines. So far, the Education Department has not encountered any difficulties in reserving school sites.

Annex

Reserved school sites

A) For primary schools

District No. of sites Area per site (m2)

Hong Kong Eastern 6 3 700-6 100 Southern 2 4 300 and 4 800

Kowloon Yau Ma Tei and Tsim Sha Tsui

3 5 600-6 700

Sham Shui Po 3 6 300-6 400 (boundary of one site

not yet fixed)

Kowloon City 2 3 500-6 200

Wong Tai Sin 1 (boundary not yet fixed)

Kwun Tong 2 4 000 (boundary of one site not yet fixed)

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4309 District No. of sites Area per site (m2)

New

Territories

Kwai Chung and Tsing Yi

1 4 600

Tuen Mun 2 6 200

Yuen Long 6 4 000-6 100 (boundary of three

sites not yet fixed)

Tai Po 2 4 000 and 5000 Sha Tin 2 6 300-7 800 Sai Kung 7 5 000-8 000

Island (Cheung

Chau)

B) For secondary schools

11 4 700-8 000

---

50

District No. of sites Area per site (m2)

Hong Kong Central and Western

1 5 400

Eastern 8 5 400 and 7 200

Southern 5 3 700-6 500

(boundary of one site

not yet fixed)

Kowloon Sham Shui Po 4 5 900-7 500 Kowloon City 3 5 700-6 800

Wong Tai Sin 3 5 300-7 700

Kwun Tong 15 5 600-8 800

(boundary of eight

sites not yet fixed)

4310 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 District No. of sites Area per site (m2)

New

Territories

Kwai Chung and Tsing Yi

4 5 000-10 800

Tsuen Wan 1 6 100 Tuen Mun 9 5 500-7 000 Yuen Long 5 5 800-7 000 North 4 6 200-6 900 Tai Po 3 5 800-6 900

Sha Tin 7 6 900-9 600 (boundary of two sites

not yet fixed)

Sai Kung 21 4 300-6 900

Island 12

----

105

C) For special schools

5 000-11 000

District No. of sites Area per site (m2) Kowloon Kwun Tong 1 2 000

New

Territories

Fiscal reserves

Tai Po 1

--

2

2 950

17. MR FREDERICK FUNG asked (in Chinese): According to the Memorandum of Understanding Concerning the Construction of the New Airport, the Hong Kong Government will have, as its firm objective to leave not less than $25 billion as the fiscal reserves for the use of the Hong Kong Special Administrative Region Government by 30 June 1997. Will the Government inform this Council whether the capital of Trading Funds, to be implemented before and after 1997, will be included in the reserves; if so, whether there have been discussions with the Chinese Government on the issue; if not, what are the reasons?

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4311

SECRETARY FOR THE TREASURY: Mr President, the fiscal reserves represent the accumulated balances of the General Revenue Account, the Capital Works Reserve Fund (excluding the Suspense Account), the Loan Fund, the Capital Investment Fund and the Disaster Relief Fund, that are available to meet Government’s future expenditure. Details of these are set out in the Notes on the Medium Range Forecast, published as Appendix A to the 1994 Budget speech.

Trading funds operate under accounting arrangements which are separate from the remainder of Government. The Trading Fund Ordinance provides that the Financial Secretary may, only in certain exceptional circumstances such as closure, transfer capital from Trading Funds to the General Revenue Account. Although the assets of Trading Funds remain in the ownership of the Government, their capital, as a result of these separate accounting arrangements, does not form part of the fiscal reserves. The question of discussions in this context with the Chinese Government does not therefore arise.

Report of the Working Party on Primary Health Care

18. DR CONRAD LAM asked (in Chinese): Will the Government inform this Council of the following:

(a) with regard to the claim by the Government that 95 of the 102 recommendations put forth in the Report of the Working Party on Primary Health Care released in December of 1990 have already been implemented, how much resource and manpower have been deployed to implement these recommendations;

(b) what timetable has been set for the full implementation of the various programmes that are “yet to be introduced” or “in the process of introducing”; and

(c) how much more resource and manpower are required to put the rest of these recommendations into practice?

SECRETARY FOR HEALTH AND WELFARE: Mr President,

(a) Of the 102 recommendations of the Working Party’s Report on Primary Health Care, 98 recommendations have been or are being implemented. Many of the service improvements and new initiatives are built on existing infrastructure and are undertaken progressively over a period of time. It may be relevant to note, however, that in 1994-95, $1,316.8 million has been provided for primary health care, representing 67.9% of the approved estimate to the Department of Health for that year.

4312 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

(b) The remaining four recommendations concern the introduction of a domiciliary occupational therapy service, changes to the structure for fees and charges, the reorganization of the Department of Health and the establishment of a Primary Health Care Authority.

Instead of a Domiciliary Occupational Therapy service, we are studying the introduction of a pilot District Health Nursing Service as part of the District Health System. This service will focus primarily on disease prevention and health promotion and will be integrated with the general out-patient service. The other remaining recommendations need to be further examined in the context of the overall development of health and medical services and major policy and financial considerations.

(c) The financial implications of implementing the remaining recommendations will be identified at the time of implementation.

Primary health care services

19. DR CONRAD LAM asked (in Chinese): Will the Government inform this Council of:

(a) the number of medical officers in the Department of Health who are currently engaged in providing primary health care services, the minimum qualifications required of them and the kinds of in-service training they need to undergo; and

(b) the percentage of those with specialist qualifications in this group of medical officers and its breakdown by discipline?

SECRETARY FOR HEALTH AND WELFARE: Mr President,

(a) As at 1 June 1994, 297 of the 480 Medical and Health Officers in the Department of Health are engaged in providing primary health care services.

To qualify for appointment as a Medical and Health Officer, the applicant should possess a medical qualification registrable in Hong Kong in accordance with the Medical Registration Ordinance (Cap. 161).

With regard to in-service training opportunities, both local and overseas courses are available. Short courses in the form of seminars, workshops, conferences, refresher courses and clinical attachments are organized to update the officers’ knowledge on subjects relevant to their practices. Long courses such as diploma

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4313

or degree courses in Family Medicine, Public Health Medicine, Occupational Medicine, Epidemiology and Applied Statistics, and so on, provide more in-depth training for the purpose of staff development.

(b) On average, one out of 11 officers (9.09%) in this group possesses specialist qualifications. The breakdown by discipline is as follows:

Discipline Percentage

Family Medicine

(for example, general outpatient)

Community Medicine

(for example, public health, family health, health education)

6.25% 15.87%

Scheme on Importation of Professionals and Managers from China

20. MR JAMES TIEN asked (in Chinese): As Phase I of the applications under the Scheme on Importation of Professionals and Managers from China has ended, will the Government review whether sufficient publicity measures have been adopted to promote the Scheme? Furthermore, will the Government streamline the application procedures of the Scheme to make it more convenient for the industrial and commercial sectors to participate in the Scheme?

SECRETARY FOR EDUCATION AND MANPOWER: Mr President, the scheme was given ample publicity and was reported extensively by the media. As a result, over 10 000 application forms were distributed and over 2 000 applications received at the end of Phase I on 31 May 1994. The Government will continue to promote the scheme through existing channels.

The pilot scheme is an extension of the present policy for entry of overseas professionals. The Government will review the procedures of the scheme in the light of operational experience. We welcome all views and suggestions on how the scheme may be further improved.

Motions

BIRTHS AND DEATHS REGISTRATION ORDINANCE

THE SECRETARY FOR SECURITY moved the following motion:

“That with effect from 15 July 1994 the Births and Deaths Registration Ordinance be amended -

4314 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 (a) in section 9(2) by repealing “$40” and substituting “$80”;

(b) in section 9(3) by repealing “$200” and substituting “$400”;

(c) in section 13(2) by repealing “$40” and substituting “$80”;

(d) in section 13(3) by repealing “$125” and substituting “$250”;

(e) in section 22(1) by repealing “$40” and “$80” and substituting “$80” and “$160” respectively;

(f) in section 22(2) by repealing “$40” and substituting “$80”;

(g) in section 22(3) by repealing “$200” and substituting “$400”;

(h) in section 23 by repealing “$20” and substituting “$40”;

(i) in section 27(c) by repealing “$125” and substituting “$250”.”

He said: Mr President, I move the first motion standing in my name on the Order Paper. This proposes increases in the fees specified in the Births and Deaths Registration Ordinance for the registration of births and deaths and related matters.

A recent review of fees and charges collected by the Immigration Department has indicated that in various areas, the department is not recovering its costs: these are, the registration of persons, where the average shortfall is about 33%; the registration of births, deaths and marriages, where the average shortfall is about 59%; and the issue of travel documents, where the average shortfall is about 8%.

It is government policy to provide services to the public on a cost-recovery basis, unless there are good reasons for doing otherwise. We are, therefore, proposing to revise the fees in the three areas I have mentioned. Full details of all the increases taking place at this time are contained in the Annex which I have tabled for the information of Members.

The fees to be revised were last revised in June 1993. If approved, the new fees will be introduced on 15 July this year.

Mr President, I beg to move.

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4315

Annex

Summary of proposed increases in fees and charges

collected by the Immigration Department

Chapter

Legislation

section/sch

edule Item Description of fees

Present rate

$

Proposed rate

$

115 S.59 2nd Sch. (sub.

leg.)

1 Seaman’s Identity Book (whether of full or restricted

validity)

3 Seaman’s Certificate of Nationality and Identity

4 Renewal of a Seaman’s Certificate of Nationality and

Identity

8(a) HK Certificate of Identity (44- page)

(b) HK Certificate of Identity (92- page)

9 Multiple Re-entry Permit (whether of full or restricted

validity)

110 135

110 135 20 25

225 270 450 540

70 85

10 Re-entry Permit for 1 visit 20 25

18 Endorsement to a Travel Document for which no specific

fee is provided

19 Service charge for supplying, on application, a copy of any

document, or for making or

forwarding, or both, a request

for recommendation to any

authority of a foreign state or

Commonwealth country, for

consular or nationality

registration or for the issue or

renewal of a passport or other

travel document or of a

document of identity or for the

grant of a visa or entry permit.

20(a) Document of Identity

(44-page)

(b) Document of Identity

(92-page)

85 105 90 110

200 240 400 480

4316 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

Legislation

section/sc

Present rate

Proposed rate

Chapter

hedule Item Description of fees

$

$

177 S.7 Sch. 2 (sub. leg.)

181 S.36 2nd Sch.

3 Lost or destroyed identity card replaced under reg. 13

4 Damaged or defaced identity card replaced under reg. 13

5 Identity card requiring alteration replaced under reg. 14(1)(a)

8 Certificate or a certified copy furnished under reg. 23 of ROP

Ordinance

1 Filing and exhibition of notice of marriage

3(a) Search made under S.26 during any number of successive hours

not exceeding 6, without the

object of the search being

specified

3(b) Search under S.26 for a specified entry whether the

search is made by the applicant

or by the Registrar on his behalf

4 Certified copy of an entry given under S.26 to local applicant

4 Additional charge for the certified copy of an entry given

under S.26 to overseas applicant

5 Certificate under S.26 of absence of any record to local

applicant

5 Additional postage charge for the certificate under S.26 of

absence of any record to

overseas applicant

6 Special licence under S.11 granted by the Governor

7(a) Marriage at the office of the Registrar ― during normal

office hours

220 330 120 130 220 330 220 330

90 180 200 400

40 80

80 160 20* 40*

200 400 20* 40*

3,200 6,400 210 420

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4317

Chapter

Legislation

section/sc

hedule Item Description of fees

Present rate

$

Proposed rate

$

7(b) Marriage at the office of the

Registrar ― outside normal

office hours

8 Celebration by the Registrar,

elsewhere than in his office, or

marriage by special licence or of

person in articulo mortis

9 Celebration by the Registrar of

Marriages under paragraph (b)

of the provison to S.21(3), per

marriage and in addition $2,120

(to be paid proportionately by

the parties being married) or

$280 per marriage, whichever is

the greater

174 S.9(2) Post registration of birth (after 42 days) within 12 months from

the date of birth

S.9(3) Post registration of birth after 12 months from the date of birth

S.13(2) A certificate of Registration of addition or alteration of name of

child

S.13(3) Addition or alteration of name of child after 42 days from the

date of the birth

S.22(1) A certified copy of an entry in the register to a local applicant

S.22(1) A certified copy of an entry in the register to overseas

applicant

S.22(2) A particular search of the births and deaths records

S.22(3) A general search of the births and deaths records

S.23 A shortened form of birth

certificate

S.27(c) Correction of an error of fact or substance in registers of births

and deaths

570 1,140 1,500 3,000

700 1,400

40 80

200 400 40 80

125 250

40 80 80* 160*

40 80 200 400 20 40 125 250

4318 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

Legislation

section/sc

Present rate

Proposed rate

Chapter

hedule Item Description of fees

$

$

180 S.5 A certificate by Registrar of Marriages given under S.5 of

the Foreign Marriage Ordinance

S.6 Governor’s licence given under S.6 of the Foreign Marriage

Ordinance

20 40 200 400

184 S.3(4) Sch.

5 Re-registration of birth if information not furnished within the specified time

6(1) A certified copy of an entry of the birth of a legitimated person

100 200 40 80

290** S.18(3) (Adoption

Ordinance)

A particular search 40 80 A general search 200 400

A shortened form of birth certificate

A certified copy of any entry in the Adopted Children Register to local applicant

A certified copy of any entry in the Adopted Children Register to overseas applicant

20 40 40 80

80* 160*

Note: * on top of charge for the same service given to local applicant plus an additional amount equal to the airmail postage at the normal rate.

** The rate of the fees for these documents follows that prescribed under the Births and Deaths Registration Ordinance (Cap 174). Therefore, there is no need to introduce separate amendments to the Adoption Ordinance.

Chapter

Legislation

section/sc

hedule Item Description of fees

Present rate

$

Proposed rate

$

175 S.13 5th Sch. 1 A particular search 40 80 Pt. I 2 A general search 200 400

3 A correction of an error in any register book

125 250

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4319

Chapter

Legislation

section/sc

hedule Item Description of fees

Present rate

$

Proposed rate

$

4 A certified copy of an entry in any of the register books to local applicant

4 A certified copy of any entry in any of the register books to

overseas applicant

40 80 80* 60*

176 S.13 4th Sch.

1 A particular search 40 80

Pt. I 2 A general search 200 400

3 A correction of an error in any

register books

4 A certified copy of an entry in

any of the register books to local

applicant

4 A certified copy of an entry in

any of the register books to

overseas applicant

178 1 Filing of application for

125 250 40 80

80* 160*

S.24 of Cap. 40 80

178 and

S.28 of Cap. 1, Sch.,

(sub. leg.)

registration of marriage

2 Certificate of registration of marriage under S.9 of the

Marriage Reform Ordinance

3(a) A search made under S.13 during any number of

successive hours not exceeding

6, without the object of the

search being specified.

3(b) A search for a specified entry where the search is made by the

applicant or by the Registrar on

his behalf under S.13

4 Certified copy of an entry given under S.13 of the Marriage

Reform Ordinance to local

applicant

125 250 200 400

40 80 70 140

4320 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

Legislation

section/sc

Present rate

Proposed rate

Chapter

hedule Item Description of fees

$

$

4 Additional charge for the certified copy of an entry given

under S.13 of the Marriage

Reform Ordinance to overseas

applicant

5 Certificate under section 13 of the Marriage Reform Ordinance

of the absence of any record to

local applicant

5 Additional postage charge for the certificate under Section 13

of the Marriage Reform

Ordinance of the absence of any record to overseas applicant

20* 40*

200 400 20* 40*

Note: * on top of charge for the same service given to local applicant plus an additional amount equal to the airmail postage at the normal rate.

Explanatory notes

(1) Fees under Cap. 115, 177 and 181 are to be approved by Secretary for the Treasury. (2) Fees under Cap. 175, 176 and 178 are approved by Order of the Governor.

(3) Fees under Cap. 174, 180 and 184 need to seek Legislative Council resolution.

Subsidiary Legislation under note (1) and (2) are to be tabled at the Legislative Council on 8 June 1994. Subsidiary Legislation under note (3) are to be tabled at Legislative Council on 15 June 1994.

Question on the motion proposed, put and agreed to.

FOREIGN MARRIAGE ORDINANCE

THE SECRETARY FOR SECURITY moved the following motion:

“That with effect from 15 July 1994 the Foreign Marriage Ordinance be amended - (a) in section 5 by repealing “$20” and substituting “$40”;

(b) in section 6 by repealing “$200” and substituting “$400”.”

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4321

He said: Mr President, I move the second motion standing in my name on the Order Paper. It seeks to increase the fees specified in the Foreign Marriage Ordinance.

The Foreign Marriage Ordinance provides a means whereby Commonwealth citizens can give a notice of marriage in Hong Kong, even though the marriage has taken place at a British Embassy abroad. Fees are payable for the issue of a certificate by the Registrar of Marriage. The fees were last revised in June 1993 and it is now proposed to increase them from $20 to $40, for a certificate by the Registrar of Marriages, given under section 5, and from $200 to $400, for a Governor’s licence, given under section 6 of this Ordinance.

Mr President, I beg to move.

Question on the motion proposed, put and agreed to.

LEGITIMACY ORDINANCE

THE SECRETARY FOR SECURITY moved the following motion:

“That with effect from 15 July 1994 the Schedule to the Legitimacy Ordinance be amended -

(a) in paragraph 5 by repealing “$100” and substituting “$200”;

(b) in paragraph 6(1) by repealing “$40” and substituting “$80”.”

He said: Mr President, I move the third motion in my name on the Order Paper. It seeks to increase the fees specified in the Schedule to the Legitimacy Ordinance.

The Legitimacy Ordinance provides for the re-registration of the births of legitimated persons. Fees collected relate to the re-registration of births and the issue of certified copies of entries of the birth of legitimated persons. The fees were last revised in June 1993. It is now proposed to revise the fees from $100 to $200, for re-registration of births, and from $40 to $80, for a certified copy of an entry of the birth.

Mr President, I beg to move.

Question on the motion proposed, put and agreed to.

4322 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 First Reading of Bills

HONG KONG ARTS DEVELOPMENT COUNCIL BILL

STAMP DUTY (AMENDMENT) (NO. 2) BILL 1994

INLAND REVENUE (AMENDMENT) (NO. 2) BILL 1994

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

Second Reading of Bills

HONG KONG ARTS DEVELOPMENT COUNCIL BILL

THE SECRETARY FOR RECREATION AND CULTURE moved the Second Reading of: “A Bill to provide for the establishment and the functions of the Hong Kong Arts Development Council as a body corporate for the purpose of the development of the arts in Hong Kong.”

He said: Mr President, I move the Second Reading of the Hong Kong Arts Development Council Bill 1994.

The Hong Kong Arts Development Council Bill provides for the establishment of the council as a statutory body dedicated to the development of the arts in Hong Kong.

A working group was appointed by the Governor in October last year to draw up detailed recommendations for the future Hong Kong Arts Development Council (HKADC) including its membership guidelines, terms of reference, functions, objectives, structure, staffing and modus operandi.

Upon completion of its work, the working group prepared a progress report including detailed recommendations which was submitted to the Governor by the chairman of the working group in March this year.

The Governor accepted the recommendations in the report that the HKADC should be established initially as a non-statutory body in April 1994 and later as a statutory body by April 1995. The council was appointed in its initial non-statutory form on 15 April 1994.

The prime mission of the council is to plan, promote and support the broad development and appreciation of and participation in the arts, placing particular emphasis on the literary, performing and visual arts, with a view to improving the quality of life of the community. The detailed functions and powers of the council are set out clearly in the Bill and provide the Council with

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4323

a strong mandate on which to base its work. The Bill has been considered by the council and has the council’s full support.

The format and the provisions contained in the Bill are largely standard for this kind of statutory body, but there are some to which I would like draw attention.

Clause 3 establishes the council and specifies composition of the membership. As stated in clause 3(3), the council will have 20 members of which 16 including the chairman and vice-chairman will be non-official whilst four will be ex officio. Clause 3(4) specifies which type of persons may not be appointed as non-official members.

Clauses 4 and 5 set out the functions and powers of the future statutory council. These are consistent with the existing, non-statutory council’s mission statement and terms of reference.

Clause 6 allows the council to recruit its own staff.

Financial arrangements are set out in clauses 8 to 15. They include provision for the council to receive subvention from the Government through funds appropriated by the Legislative Council and also allow the council to receive income from other sources including gifts, donations, fees and returns on investments. They also allow the council to make investments and to borrow, subject to the approval of the Financial Secretary.

Clause 16 enables the Governor to give directions to the council if necessary in the public interest and consistent with the powers and functions of the council.

It is hoped that the Bill can be processed in time for enactment by April of 1995. Mr President, I beg to move.

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

STAMP DUTY (AMENDMENT) (NO. 2) BILL 1994

THE SECRETARY FOR FINANCIAL SERVICES moved the Second Reading of: “A Bill to amend the Stamp Duty Ordinance.”

He said: Mr President, I move the Second Reading of the Stamp Duty (Amendment) (No. 2) Bill 1994.

4324 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

The Bill primarily seeks to relax the current restrictions on stamp duty relief for stock borrowing and lending activities. Submissions have been made to the Government that such restrictions were hindering the development of a stock borrowing and lending market in Hong Kong. That in turn has been discouraging short-selling activities and other market development measures such as the introduction of stock options being planned by the Stock Exchange of Hong Kong Limited.

At present, stamp duty is not payable on a stock borrowing and lending transaction under certain situations. The transaction has to be carried out by an “approved borrower” for the “sole purpose” of settling a sale of Hong Kong stock effected in the local stock exchange and the borrowed stock must be returned within 14 days. “Approved borrower” in this context refers to members of the stock exchange.

These measures were introduced in 1989 to help resolve stock settlement problems caused by temporary delay in the delivery of stock, for example, where the stock is held overseas. The measures were satisfactory for that purpose. However, the market has moved on and stock borrowing and lending activities have assumed another important function, namely, to facilitate the short-selling of securities. The Stock Exchange of Hong Kong Limited introduced regulated short-selling in January this year but the market has remained inactive. The primary reason for this inactivity rests with the current restrictions on stamp duty relief for stock borrowing and lending.

To address the problem, the Bill proposes to extend the stock return period from 14 days to 12 months or such longer period as the Commissioner of Inland Revenue may allow and to remove the “approved borrower” requirement. It also seeks to replace the “sole purpose” requirement with a number of “specified purposes” such as the borrowing of stock for settling a future sale, for on-lending to another person or for settling a sale of stock effected outside Hong Kong.

To deter non-compliance under the relaxed relief provisions, the penalty for a failure to comply with the relevant requirements under the Stamp Duty Ordinance is to be increased from $1,000 to $5,000.

The amendments proposed are expected to encourage the development of an active stock borrowing and lending market in Hong Kong. This will help to improve our competitiveness with other major securities markets, in particular those which have been trying to attract major players from the Hong Kong market to establish stock borrowing and lending operations in their own jurisdictions.

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

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4325 INLAND REVENUE (AMENDMENT) (NO. 2) BILL 1994

THE SECRETARY FOR FINANCIAL SERVICES moved the Second Reading of: “A Bill to amend the Inland Revenue Ordinance.”

He said: Mr President, I move the Second Reading of the Inland Revenue (Amendment) (No. 2) Bill 1994.

This Bill is related to the Stamp Duty (Amendment) (No. 2) Bill 1994, the Second Reading of which I have just moved. It seeks to introduce technical amendments to the Inland Revenue Ordinance, to clarify the profits tax treatment of a stock borrowing and lending transaction and compensatory payments arising therefrom.

In the absence of specific provisions, a stock borrowing and lending transaction would be treated as involving a transfer of title of the stock concerned and, for profits tax purposes, as a sale and purchase of stock. A profits tax liability may therefore arise and this would discourage the borrowing and lending of stock.

The Bill therefore proposes to treat a disposal and re-acquisition of securities under a stock borrowing and lending arrangement as a loan transaction in the context of the Inland Revenue Ordinance. As a result, no profit or loss will emerge for profits tax assessment. It is also proposed that a compensatory payment made by a borrower to a lender for a distribution in respect of the borrowed stock during the borrowing period will be treated as if the distribution itself has been received directly by the lender. This will avoid such payments from being subject to profits tax.

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

COMMISSIONER FOR ADMINISTRATIVE COMPLAINTS (AMENDMENT) BILL 1993

Resumption of debate on Second Reading which was moved on 21 July 1993 Question on Second Reading proposed.

MR FRED LI (in Cantonese): Mr President, the Commissioner for Administrative Complaints (Amendment) Bill 1993 primarily serves the following purposes:

4326 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

(a) To allow members of the public to bring their complaints directly to the Commissioner for Administrative Complaints (COMAC);

(b) To bring within the scope of COMAC’s jurisdiction six statutory bodies, namely the Mass Transit Railway Corporation, the Kowloon-Canton Railway Corporation, the Securities and Futures Commission, the Housing Authority, the Regional Council and the Urban Council; and

(c) To allow COMAC to publish reports on his inquiries.

The Bill was tabled at this Council on 21 July 1993. A Bills Committee, formed by 10 Legislative Councillors, was then set up and began its work on 29 April this year. The committee has since held three meetings. One of the meetings was with the Government. Another was with COMAC. The committee had also studied four submissions presented by the two municipal councils and met with their representatives. As Chairman of the Bills Committee, I would like to avail myself of this opportunity to thank all colleagues on the committee for their time and energy spent on the discussions. I also thank the Government and COMAC for their co-operation and the two municipal councils for their suggestions and for their assistance in the committee’s scrutiny of the Bill.

Mr President, I am now providing a gist of the committee’s discussions.

The representatives of the two municipal councils were opposed to the proposal to bring these councils under COMAC’s jurisdiction. Their principal arguments were as follows:

(a) The two municipal councils constitute the middle tier of the three tiers of representative government. It is unfair for them to be singled out.

(b) The two municipal councils’ work has to do primarily with policy issues which lie beyond COMAC’s jurisdiction. Their executive arms (the Regional Services Department and the Urban Services Department) are already subject to COMAC’s remit.

(c) Members of the public with complaints against the two municipal councils and their boards may file them through existing channels, which are operating satisfactorily.

(d) The majority of members of the two municipal councils are returned by elections. It is incompatible with the principle of democracy for one appointed by the Governor, namely COMAC to supervise the work of a body with elected elements.

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4327

The Government countered with the following arguments. The Government’s policy is to expand COMAC’s jurisdiction progressively until it covers all major statutory bodies, whose accountability will thereby be increased. The first to be affected will be those statutory bodies which provide essential services to the public. The two municipal councils have broad administrative functions and they provide essential municipal services. It will therefore be in the public’s interest to bring the two municipal councils within COMAC’s remit. In addition, it is necessary to ensure that the two municipal councils will take effective steps to carry out COMAC’s recommendations. To achieve this purpose, it is important that not only their executive arms but also the two municipal councils themselves should be brought under COMAC’s jurisdiction. The Government has confirmed that its proposal to bring the two municipal councils within the scope of COMAC’s jurisdiction is intended not as a substitute for, but as an addition to, the existing complaints channels. Members of the public will be provided with an extra channel, which is supplementary to the existing ones. Though appointed by the Governor, COMAC is not part of the administrative machinery. The role of his office should be regarded as that of an independent body responsible for the prevention of maladministration on the part of the Government and public bodies. While a member of the public, if unhappy with the performance of an elected member of either municipal council, can always select not to support him when he seeks re-election, this does not provide the aggrieved party with immediate relief. In contrast, recommendations by COMAC after making an inquiry into the complaint will have such an effect.

Some committee members are satisfied with the Government’s explanations. Others are deeply sceptical about whether the two municipal councils have administrative functions and whether COMAC will act effectively as an alternative complaints channel. They are of the following opinions: The two municipal councils are primarily responsible for policy making. The policies that they make are carried out by their executive arms. Since the scope of COMAC’s inquiries does not cover policy matters, one wonders what useful purpose it will serve by bringing policy-making, bodies under COMAC’s jurisdiction. Besides, there are already enough channels in existence for handling public complaints. In view of this, plus the financial implications brought about by the Government proposal, there is no strong justification for establishing an extra channel.

In consideration of the diversity of views, the committee held that there was no need to strive for a unanimous agreement. Colleagues who wish to move amendments may do so on their own account at the Committee stage. Therefore, Mrs Elsie TU and Mr Alfred TSO intend to move amendments at the Committee stage later on to delete the Urban Council and the Regional Council from the schedules of organizations proposed to be subject to COMAC’s jurisdiction.

4328 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

The committee also studied whether the Legislative Council has any administrative functions and, if it does, whether the legislature should also be subject to COMAC’s jurisdiction. Committee members, after some discussion, came to the view that this matter lies outside the scope of the present Bill and should not be brought up at this stage.

One member committee wanted to know whether COMAC can investigate complaints filed, not by an individual, but by a group. The Government, in response, clarified that clause 3 of the Bill defines “individual” as meaning either an individual or a body corporate. The committee was satisfied with this explanation.

The Government also confirmed that COMAC can carry out investigation only after a complaint has been made. The Government intends to clarify this point by moving an amendment at the Committee stage.

The committee looked into whether COMAC should be empowered to initiate inquiries. Some members were of the opinion that, if empowered to initiate complaints and then to make inquiries into them, COMAC will be able to provide essential relief in cases affecting the public’s interest, that generally go beyond the interests of individuals. Yet the Government pointed out that this may lead to conflicts of interests, since COMAC will play a dual role of the plaintiff and the judge. Also, if the scope of COMAC’s jurisdiction is extended as proposed, his limited resources will be overstretched. Mr LEE Wing-tat, a member of the committee, is not satisfied with the Government’s explanation. He intends to move amendments at the Committee stage on his own account to empower COMAC to initiate inquiries.

On the question whether COMAC should make inquiry into complaints about professional judgments, the Government explained that COMAC’s remit will be extended to cover inquiry into mistakes of professional judgment stemmed from maladministration. The committee was satisfied with this explanation.

Finally, the committee also looked into whether it would be necessary for this Council to set up a committee to oversee COMAC’s work and to see whether his recommendations are put into practice. At present, COMAC, under the law, must give an annual work report to the Governor and submit the report to this Council for review. The Bills Committee held that the Government should be requested to answer questions arising from COMAC’s report submitted to the Governor in the same way it deals with questions put to it by Members in the Public Accounts Committee. After studying the Government’s response, committee members will make a decision on whether such a committee should be set up and, if so, what form it should take.

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

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4329

MR PETER WONG: Mr President, the Liberal Party supports the Commissioner for Administrative Complaints (Amendment) Bill 1993. We support the amendments to be moved by the Chief Secretary as well as those of the Honourable Mr LEE Wing-tat because we believe that the Commissioner for Administrative Complaints (COMAC) will use his powers responsibly to investigate situations when no complaints have been made directly or indirectly to him. However, we do not support the amendments proposed by the representatives of the Urban and Regional Councils Functional Constituencies for the reasons advised by the Administration. Further, I will be obliged if the Administration can give me a confirmation that the complainant can either be an individual person or an artificial person such as a limited liability corporation.

Regrettably, there have been different interpretations of the word “person”, and environmental concern organizations which have been duly incorporated under the Hong Kong Companies Ordinance have been excluded. This unclear definition has not only generated ill feelings but has also given rise to contrived forms of complaints from those who try to come under the Commissioner’s jurisdiction.

I will be obliged if the Secretary can confirm that it is now also the Commissioner’s understanding that the definition of “person” includes corporations. Lastly, can the Administration confirm that the government minute will be tabled in this Council within, say, three months of COMAC’s report on actions taken pursuant to the recommendations contained in that report? Hopefully this will obviate the creation of a replica Public Accounts Committee.

MR MICHAEL HO (in Cantonese): Mr President, I am not one of the members of the Bills Committee, because I was late in enrolling myself. Thus all along I have been participating in the meetings in the capacity of a member in attendance.

I speak because I notice the diverse range of views as regards the terms of reference and the professional judgement of the Commissioner for Administrative Complaints (COMAC) as held by the Administration, the former COMAC and some other organizations such as the Hospital Authority (HA). Thus while the Committee was deliberating the matter, I had once considered proposing some amendments which would help to clarify the question concerning professional judgement. But after deliberation, I found that the existing legislation was basically clear enough to deal with that question. Therefore I decided not to propose an amendment. Nevertheless, I still want to speak here to point out some questions which are causing me concern.

Mr President, while going through some documents in the process of studying the present Bill, I found that many professional judgement problems were involved in a number of cases, including those relating to the former Hospital Services Department, the Department of Health, the Legal Aid

4330 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

Department and the existing HA. I found that all along the various government departments did not apparently have differing views as regards COMAC’s investigation of the complaints concerned. It was not until 1991 when the HA took over control of the public hospitals that the HA pointed out the problem about COMAC’s investigation involving professional judgement. Mr President, I would like to declare interest. I am a member of the Board of Directors of the HA. From the documents on the discussions held between the HA and COMAC in 1991 and 1992, it can be seen that their views differed widely. In March 1992, the HA, in a letter to COMAC, mentioned quite a number of items which the HA thought that COMAC should not investigate, for example, certain aspects of professional conduct, diagnosis, cause of death, examination, prescription, standard of treatment, and medical negligence, and medical professional standard including academic qualifications and experiences. In early 1992, the HA wrote to the Administration, expressing the wish to make some amendments to Schedule 2 which would clearly state that clinical diagnosis be excluded. The former COMAC expressed different views in his reply letter. He thought that if the various professional areas mentioned above were excluded, COMAC would not be able to investigate into a number of matters concerning the HA.

Mr President, I accept the present amendment to section 7(1) of the Ordinance. As regards administrative functions, it is already clearly stated that COMAC is not responsible for the investigation of professional judgement. But actually in many decisions, different levels of professional judgement will be involved to a certain extent. The existing legislation does not allow COMAC to investigate complaints about professional judgement, but COMAC is able to investigate certain administrative problems in which professional judgement is involved. Of course, during the course of investigation, it may be necessary to understand or investigate the professional judgement concerned before deciding whether maladministration is involved. These arrangements are very close to the statutory provisions related to the Health Services Commissioner for England and Wales, that is to say, the Commissioner is responsible for assessing whether the judgement is purely clinical so as to decide whether it comes within his area of investigation.

Section 2(1) of the existing Ordinance points out that some investigation action was based wholly or partly on a mistake of law or fact. This provision has already allowed COMAC to investigate whether there is any mistake of law or fact. This may involve professional judgement. Or only after an investigation can it be established whether the problem is related to professional judgement or administration. I firmly believe that if COMAC finds during investigation that it is purely professional judgement that was involved, he would not go beyond his terms of reference. Therefore, I hope that the Administration and some executive departments will not be too sensitive to this. The spirit of this legislation is to provide a channel for the public to air their grievances. I am in favour of COMAC continuing to adopt the effective way of investigation as usual, this is, to investigate all related factors in the first

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4331

instance. I hope that with the new Ordinance, COMAC can serve the Hong Kong people more effectively.

Mr President, I so submit.

MR ALFRED TSO (in Cantonese): Mr President, I support the Commissioner for Administrative Complaints (Amendment) Bill 1993 today. Nevertheless I am going to move an amendment later.

I have asked the Regional Council Secretariat to send a copy of a letter dated 6 May 1994 issued by the Chairman of the Regional Council to Members of this Council. The letter laid down the views of the Regional Council on the extension of the jurisdiction of the Commissioner for Administrative complaints (COMAC) to the Regional Council and the council’s objections as well. I believe that Honourable Members have already noted from the letter the objections and attitude of the Regional Council. In short, there are four objections against the proposed inclusion of the Regional Council under COMAC’s jurisdiction. Mr Fred LI has already expounded some of them. Despite this, I still would like to give Honourable Members a brief account.

Firstly, the Regional Council is a policy-making body and its duties are by no means of administrative nature. Policies formulated by the Regional Council are implemented by the Regional Services Department which, together with the Regional Council Secretariat, is already under COMAC’s remit.

Secondly, most of the members of the Regional Council are elected. From April 1995 onwards, all members of the Regional Council will be returned by elections. It is not in line with the principle of democratic development if we have a Governor-appointed body vetting the work of a largely elected body. As a matter of fact, the decisions of Regional Councillors should be monitored and vetted by the public at large rather than by an executive-appointed body.

Thirdly, the Regional Council issues liquor licences through the Liquor Licensing Board but liquor licensing itself is essentially not an administrative job. All the investigation and preparatory work for an application and the follow-up and monitoring after the granting of a liquor licence are carried out by various government departments. The Liquor Licensing Board’s role is basically quasi-judicial in nature. It is against Hong Kong’s constitution to empower COMAC, an administrative body on the Administration’s organization chart, to investigate a quest-judicial organization’s work. The independence of our judicial system must be upheld.

Fourthly, the Executive Council, though essentially playing an advisory role, is very influential in the decisions of the Government and government departments, which have enormous bearing on people’s well being. Should the

4332 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

Regional Council be placed under COMAC’s jurisdication, we are of the view that the Executive Council should be placed under COMAC too.

In view of the reasons mentioned above and the details as listed in the letter, I hope that Members of this Council will support the exclusion of the Regional Council from COMAC’s remit. I understand that Mrs Elsie TU, who represents the Urban Council in this Council, will be moving a similar motion and taking actions accordingly later on. I hope that Members will consider our amendments and support us.

MR LEE WING-TAT (in Cantonese): Mr President, I speak to support the resumption of the Second Reading of the Commissioner for Administrative Complaints (Amendment) Bill 1993.

Mr President, since the establishment of the Office of the Commissioner for Administrative Complaints (COMAC) five years ago, it has been providing members of the public in Hong Kong with an additional effective avenue to redress their grievances and make complaints against maladministration in government departments. This Office differs from a regular government department in that it is independent of the Administration and empowered by the law to look into and identify any malpractices in a department which is the subject of a complaint. It will propose remedial measures and require the department concerned to carry them out. I have talked to the Commissioner for Administrative Complaints and his predecessor in many meetings. They held that, under the existing system, most government departments were co-operative with the Office and willing to carry out its proposed remedial measures.

Mr President, during the past five years since the establishment of the Office of the COMAC, many people and district board members have expressed the hope that the system will be more effectively and fully used by the public. One way to do so is to give the public, district board members and members of the two municipal councils the right of direct access to COMAC. I am glad to learn that this is included in the present amendment Bill. Apart from this amendment, two other amendments will be moved which include the extension of COMAC’s jurisdiction to more public bodies and the publication of some of its investigation reports.

On the second point, I would like to speak at length about my own experience and I support this proposal. Among the cases I have handled or referred, what impressed me most was the case of water leakage in Kwai Yan House in Kwai Fong Estate, Kwai Chung. The Commissioner looked into the case and found that the complaints of the residents and the mutual aid committee were partly substantiated. Regrettably, at that time, the Housing Authority was outside the jurisdiction of the COMAC and so the final decision made by the Housing Authority (of which I was not a member at that time) was different from the COMAC’s recommendation. The residents and the mutual aid committee had believed that COMAC was a body that can uphold social justice.

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4333

However, this goal cannot be achieved. Their conflicts with the Housing Department over the case of water leakage in Kwai Yan House in Kwai Fong Estate have continued so far. I am invited to their general meeting tonight to discuss the same matter. This incident shows that problems will arise if a policy-making body and its executive department do not come under COMAC’s jurisdiction at the same time.

Mr President, I do not support the amendments to be moved by Mr Alfred TSO and, later, Mrs Elsie TU. Their amendments aim at excluding the Urban Council and the Regional Council from COMAC’s jurisdiction. I do not agree to their amendments because of the following two reasons. Firstly, the Urban Council and the Regional Council do have some administrative functions. In the process of licensing, the Liquor Licensing Board, which is formed by the council members, decides how and when liquor licences will be issued. So it is not true to say that the municipal councils do not have any administrative function. If the Liquor Licensing Board is inefficient or discourteous to the applicants (not that it really is at present, to be sure), it is a matter of maladministration. Secondly, just as I have mentioned earlier, the Urban Services Department and the Regional Services Department are within the jurisdiction of COMAC. If their policy-making bodies, that is, the Urban Council and the Regional Council, are not, the “Kwai Yan House incident” will happen again. Since the Housing Department is subject to the jurisdiction of COMAC whilst the Housing Authority is not, there will be conflict in policies and the policy-making body does not have to abide by COMAC’s decision. Mr President, on behalf of the Meeting Point and the United Democrats of Hong Kong, I do not support the amendments by Mrs TU and Mr TSO.

Mr President, I would like to speak on two more points. There are altogether nine recommendations in the Fifth Annual Report of the Commissioner for Administrative Complaints. However, only three of them have been incorporated into the present amendments and three have not been incorporated. I think this is worth discussing. One of the recommendations has to do with COMAC’s power to initiate investigations into complaint cases. I will move an amendment on this subject at the Committee Stage later on. Briefly, this power will enable the Commissioner to initiate investigations into alleged maladministration in government departments. The Government does tell us at meetings that this is not fair because the Commissioner will be both the plaintiff and the judge. However, his counterparts or ombudsmen in many other countries such as Australia, Canada, New Zealand and even some provinces of Pakistan do have the power and such problem does not arise. Secondly, the power to initiate investigations is very useful especially in cases where the interests of many people are affected but there is no particular complainant. Such power is exercised, for instance, in the area of environmental protection against polluters in general. The Commissioner’s report states that his functions will be greatly undermined if he does not have such power. I understand very well that the Government will not propose this amendment today. Since the Government does not propose the amendment, I will.

4334 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

Another point is on the way to handle the commissioner’s annual report. Of course, we know that there are two ways in handling the annual report after it is submitted to the Legislative Council. One is that we take no notice of it just as what we are doing now. The other is that we set up a select committee to look into and discuss the major cases of serious maladministration stated in the report and then conduct hearings or questioning sessions. Of course, I have not decided whether a select committee should be set up every year after the Commissioner’s report is submitted to the Legislative Council. However, Members of this Council should not feel bound to oppose such a course of action. If such arrangement exists, we can exercise the power whenever there are such cases in the Commissioner’s report. Nor is this a novel idea. In the House of Commons in the United Kingdom, the head of a government department which is the subject of complaint in the ombudsman’s annual report must attend hearings and give replies and explanations.

Mr President, lastly, I would like to talk about the financing of the COMAC. Under existing arrangements, COMAC is financially autonomous. This is very important. If an institution is not financially autonomous, it can hardly be fully independent. The present block allocation of fund for COMAC is still mainly controlled by the executive branch. I think this should be reviewed. If the executive branch thinks that investigations conducted by COMAC are detrimental to the work of its departments, it may indirectly exert influence on the development of COMAC. Moreover, when COMAC asks for additional resources or manpower, the executive branch will only allocate some or even no resource to the COMAC. This will affect the development and independence of COMAC.

With these remarks, Mr President, I shall move an amendment at the Committee stage later on.

CHIEF SECRETARY: Mr President, I am most grateful to the Honourable Fred LI and other Members of the Bills Committee for the careful consideration given to this Bill.

The purpose of the Bill is to make changes to the COMAC redress system, following a comprehensive review of the system carried out in 1992. The main changes are to permit direct access to the Commissioner, to extend COMAC’s jurisdiction to major statutory bodies, and to empower COMAC to publish anonymized investigation reports. I will discuss these three key recommendations in turn.

Direct access

At present, a person who wishes to make a complaint to the Commissioner has to be referred by a Non-official Legislative Council Member. While this system has worked well in the past, there is a strong public wish to abolish the referral system and thus to simplify the complaints procedure. In response to

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4335

this public sentiment, we propose to put in place a direct access system so that the public can take their complaints direct to the Commissioner. This will make the COMAC Office more accessible to the community. To make it clear that the complaint should be made to the Commissioner, I will move a Committee stage amendment to clause 3(a) of the Bill.

Extension of COMAC’s jurisdiction to major statutory bodies

It is government policy to extend COMAC’s jurisdiction gradually to major statutory bodies, having regard to the functions of the body and the extent of its dealings with the public. In anticipation of a possible increase of caseload arising from the introduction of the direct access system, and to allow time for the system to adjust to the changes proposed, we propose that priority should be given to including under COMAC’s jurisdiction now those statutory bodies which provide an essential service to the community. At this stage, we propose to include six public bodies. They are the Mass Transit Railway Corporation, the Kowloon-Canton Railway Corporation, the Securities and Futures Commission, the Urban Council, the Regional Council and the Housing Authority.

All these bodies, except the municipal councils, have agreed to this proposal. Representatives of the Urban Council and the Regional Council have expressed the view that there is no justification for singling the municipal councils out from the three-tier government system and placing them under COMAC; that the two councils are primarily concerned with policy issues which fall outside COMAC’s remit; that there are already existing channels for the public to take their complaints to the councils; and that as largely elected bodies, the councils are already fully accountable to the public. In this connection, the Honourable Mrs Elsie TU and the Honourable Alfred TSO will move Committee stage amendments to exclude the Urban Council and the Regional Council respectively from the proposed extension of COMAC’s jurisdiction.

The Administration does not agree with the arguments put forward by the municipal councils. Now we explain why.

(a) Firstly, unlike the Executive Council, the Legislative Council and the district boards, the municipal councils are vested by their respect ordinances with a wide range of executive functions to provide essential municipal services to the public. These activities have a direct and significant impact on the daily livelihood of the public. There is no good reason why the way in which they are carried out should be exempted from COMAC’s independent monitoring.

(b) Secondly, “policy” and “administration” are terms of art and not legal terms. There will inevitably be a grey area between them. While the primary role of the two municipal councils is to make policy, it is clear that they also have executive functions. In

4336 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

deciding whether to undertake an investigation, the Commissioner will no doubt take into account the views of the municipal councils as to whether the subject matter of complaint falls within the area of policy. He will not have the power to interfere with the policy-making aspects of the two Councils. Similar arguments apply to the Government Secretariat, which is also primarily a policy making body, but which is also, has always been, within COMAC’s remit.

(c) Thirdly, the COMAC system is not meant to replace the existing complaints channels provided by the councils. It seeks to supplement and reinforce these channels by offering an independent and additional avenue for the public to redress their grievances.

(d) Fourthly, the accountability of elected members to their constituents should not be confused with the provision of an independent redress system. Voting a member out of office can clearly not provide aggrieved individuals with the proper and immediate remedy that the COMAC system can achieve through its investigations and recommendations made to the councils.

(e) Lastly, since the respective executive departments of the two councils, namely the Urban Services Department and the Regional Services Department, are already subject to COMAC’s jurisdiction, it would only be logical to include the two parent bodies to ensure that COMAC’s recommendations can be effectively pursued.

I would emphasize that there is no question of the independence of the municipal councils being compromised by putting them under COMAC’s remit. Indeed, I believe that doing this will only enhance public confidence in the councils. For all these reasons, the Administration does not support the amendments to be moved by the Honourable Mrs Elsie TU and the Honourable Alfred TSO.

Publication of anonymized investigation reports

The third key change to the system is to empower COMAC to publish anonymized case reports which he considers to be of public interest. This will help promote public awareness of and confidence in the COMAC system.

We have also taken opportunity to propose some tidying-up amendments to the COMAC Ordinance so as to facilitate the smooth operation of the COMAC redress system. I will just mention the proposed amendment to section 10(1)(d) of the Ordinance, which in referring to “a person” may, as it stands, be interpreted as referring to a natural person and not a body corporate. The amendment to this section under clause 4 of the Bill is to clarify that bodies corporate are included, provided that they act through natural persons.

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4337

I am pleased that the underlying principles of the Bill, which are to make the COMAC system more accessible and accountable to the public, 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 would now like to deal with the major points that arose.

Power of COMAC to initiate investigation on his own volition

First of all, the Honourable LEE Wing-tat will move Committee stage amendments to empower the Commissioner to initiate investigations on his own volition into cases of alleged maladministration which are of major public interest. We have examined his proposal carefully, and feel that this is undesirable. The primary objective of the COMAC system is to provide an additional and independent channel for ordinary citizens to redress their grievances. The duty of the Commissioner is to respond to complaints of alleged maladministration duly lodged by citizens who consider that they have sustained injustice. It would also be difficult for COMAC in practical terms to investigate a complaint where no identifiable complainant has come forward to give evidence.

Moreover, if COMAC was able to initiate investigations on his own volition, he would in effect be the complainant and the judge at the same time. This might jeopardize the perception of his impartiality. He might also find it difficult to explain why he had decided to investigate one apparent case of maladministration but not others, and might be exposed to unwarranted pressures to investigate complaints based on hearsay, or malicious complaints made anonymously. Both these situations would be clearly undesirable. For all these reasons, the Administration does not support the Honourable LEE Wing-tat’s amendments.

We have discussed the implications of the Honourable LEE Wing-tat’s amendments with the Commissioner, Mr Andrew SO. He shares our reservations.

Complaints involving professional judgement

Secondly, in the discharge of his functions, COMAC is legally bound only by the provisions of the Ordinance. Section 7(1) of the COMAC Ordinance provides that COMAC can investigate “any action taken by or on behalf of a department in the exercise of its administrative functions .....” and the term “maladministration” is defined in section 2 of the Ordinance, which is in essence refers to “inefficient, bad or improper administration”.

We believe that the provisions of the Ordinance are adequate to cover those type of cases to which the Honourable Michael HO has referred to. Indeed, according to the experience of the COMAC Office, about half of the complaint cases involving professional judgement have been accepted by COMAC for investigation on the ground that maladministration is suspected.

4338 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 Establishment of Legislative Council committee

Some Members of the Bills Committee suggested the establishment of a Legislative Council committee to monitor the work of COMAC and the implementation of COMAC’s recommendations. While the decision rests with the Council, we feel that the establishment of a Legislative Council committee is not necessary. The COMAC Ordinance already provides for the Commissioner to report serious irregularities or non-compliance with his recommendations by a head of department to the Governor, and for this report to be tabled in the Legislative Council. So far this has never been necessary. COMAC is also required under the Ordinance to make an annual report to the Governor, which will also be laid before the Legislative Council. This Bill, upon enactment, will allow COMAC to publish his case reports as he wishes. If Members see the need, the Council may, under Standing Order 61, appoint a select committee to consider matters arising from any of COMAC’s reports. Thus a system already exists for monitoring COMAC’s work and for COMAC to draw the Legislative Council’s attention to any non-compliance with his recommendations. Given the adequacy of this system and the flexibility provided by it, the Administration’s view is that there is no need for a specific standing Legislative Council committee.

Members have also suggested that the Administration should be requested, as in the case of the Public Accounts Committee, to produce a government minute in response to COMAC’s report made to the Governor. In principle, I see no objection to this suggestion. But as COMAC’s annual report contains a variety of issues, including a description of the complaint process, caseload, publicity, staff matters, statistics, and summaries, it would be helpful if Members could specify the areas which the government minute should cover. I imagine that Members’ main interest lies in cases where the complaint was substantiated and where the body being complained against failed to take the recommended measures. I would suggest that this be followed up outside the context of the Bill including the Honourable Peter WONG’s suggestion that the time limit should be specified for the submission of the government minute.

Conclusion

In conclusion, Mr President, I am confident that the proposals put forward by the Administration will be welcomed by the public as a positive step to wards enhancing the image and effectiveness of COMAC. These proposals also underline our determination to strengthen the COMAC’s redress system as an important part of an open and accountable government.

Mr President, with these remarks, I recommend the Bill to Members.

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

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4339 Bill read the Second time.

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

ENVIRONMENT AND CONSERVATION FUND BILL

Resumption of debate on Second Reading which was moved on 18 May 1994 Question on Second Reading proposed.

MR PETER WONG: Mr President, the Liberal Party supports the Environmental and Conservation Fund Bill subject to the amendments now proposed.

Of particular interest is the addition of the word “conservation” to the full name of the fund. The Honourable Edward HO, as Chairman of the Council of the Lord Wilson Heritage Trust, rightly pointed out that as the name now stands it would include the preservation of old buildings. I concur that if any building or structure has both heritage and environmental protection nature, it may qualify for the fund. I would be pleased if the Secretary would clarify the situation.

There is also some controversy over the Chinese translation of the term “conservation” or “自然保育”. This is the term now used in Taiwan. Although the People’s Republic of China still uses the old version, environmental protection or“環境保育”I am of the opinion that“自然保育”will give a better idea of what conversation is all about.

Lastly, I welcome the agreement of the Administration that the chairman of the advisory committee will be a non-official and the committee will comprise four officials, four non-officials and four from the green groups. I understand that the green groups have now sorted out amongst themselves the most appropriate method to choose their four representatives so as to ensure that the green groups are fairly represented.

I am also hopeful that if the $50,000,000 is well spent, there will be more funds down the line. This is incentive enough for all the green groups to carry on working together to achieve a faster and a better environment for Hong Kong.

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, I am grateful to the Honourable Peter WONG for his remarks and I am grateful also to Members of the Bills Committee for their careful and detailed consideration of the Environment and Conservation Fund Bill.

4340 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

In the course of their deliberations on the Bill, Members took up the question of the Chinese version of the word “conservation” and the number of non-official members in the Environment and Conservation Fund Committee. To address these matters, I will move amendments during the Committee stage.

Thank you, Mr President.

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

Bill read the Second time.

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

MOTOR VEHICLES (FIRST REGISTRATION TAX) (AMENDMENT) (NO. 2) BILL 1993

Resumption of debate on Second Reading which was moved on 5 May 1993 Question on Second Reading proposed.

MR ANDREW WONG: Mr President, the amendments to the Motor Vehicles (First Registration Tax) Ordinance provide for a new scheme on the administration of first registration tax (FRT) for motor vehicles. Under the Bill, all motor importers and distributors must be registered, and the amount of FRT payable is based on a published retail price required to be published beforehand by the distributors, instead of the Cost, Insurance and Freight (CIF) value of the motor vehicles.

In his speech moving the Second Reading debate of the Bill, the Secretary for the Treasury highlighted problems in the existing scheme whereby motor dealers are able to lawfully under-declare the CIF value of their vehicles in order to reduce the amount of FRT payable to the Government. While the scheme proposed in the Bill seeks to close the loophole, Members of the Bills Committee have questioned whether or not it is the best possible option. In response, the Administration pointed out that alternative ways of levying the FRT had been considered by the Administration and I come to conclusion that either there are problems in their enforceability, or they would result in inequity in tax burden between the rich and the poor. Members accepted the Administration’s analysis and agreed that the scheme proposed in the Bill should be pursued, on the understanding that the Administration should review the scheme a year after the enactment of the Bill.

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4341

Members were concerned about the effect of the proposed scheme on the prices of motor vehicles. The Administration stressed that the purpose of the Bill is not to raise additional revenue. To achieve revenue neutrality, it had worked out a schedule of rates such that the effect of the Bill, when viewed globally, would be almost revenue neutral. Nevertheless, as the Administration had pointed out, the actual prices would depend very much on how the market would respond to the proposed scheme. For models of vehicles where the CIF value is now under-declared, it is possible that the distributors might push up the retail prices of vehicles because they have to pay a higher FRT under the new scheme. However, factors such as the forces of competition would have to be taken into consideration by distributors in determining their own pricing policy and the future atmosphere.

Members sought clarification from the Administration on the impact of discounts in retail prices on the proposed scheme. The Administration explained that under the scheme, there would be no incentive for distributors to offer artificial discounts by marking up the retail prices and then offering discounts, because a higher FRT will then be payable with no additional gain to the distributor. If dealers are prepared to offer genuine discounts and arrange for those vehicles to be registered as separate models, the new published retail prices will be used for calculation for the purposes of FRT.

The Bills Committee then discussed in detail with the Administration the arrangements for assessing FRT under the proposed scheme and have suggested a number of amendments to the Bill mainly for the purpose of clarifying the legislative intent. Now these suggestions have been incorporated in the amendments agreed between the Administration and the Bills Committee.

These will be moved by the Administration at the Committee stage of Bill. No doubt the Administration would continue to keep under review the effectiveness of the provisions in the light of operational experience in the future. Practice Notes will be published by the Administration to explain in detail the administrative and operational details of the proposed scheme.

Mr President, I should perhaps underscore one suggestion made by the Bills Committee which has been taken on board by the Administration. This refers to the concessions for disabled vehicle owners. At present, disabled persons are exempted from FRT in respect of private cars with a CIF value not exceeding $60,000. Under the Bill, the tax exemption to these disabled persons is to cover private cars with a published retail price (PRP) not exceeding $200,000, exclusive of tax. At Members’ request, however, the Administration has agreed to extend the tax concession for these disabled persons such that they are not liable to pay any FRT on the first $300,000 of the taxable value of a motor vehicle.

4342 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

Mr President, with these remarks, I support the Bill subject to amendments to be moved by the Administration at the Committee stage.

SECRETARY FOR THE TREASURY: Mr President, the Motor Vehicle (First Registration Tax) (Amendment) (No. 2) Bill 1993 seeks to improve the existing system of FRT in a number of ways.

- First, it protects the public revenue by preventing a significant form of tax avoidance;

- Second, it clarifies for the first time who is liable to pay FRT and enables the Administration to enforce the law effectively;

- Third, it creates a level playing field for the local motor vehicle distribution business; and

- Finally, it promotes transparency of our tax system by allowing the public to know how much tax they are paying for their motor vehicle and the basis on which the tax is calculated.

The Bills Committee chaired by the Honourable Andrew WONG has offered valuable advice and detailed suggestions on various aspects of the Bill. During the seven formal meetings of the Committee, we very thoroughly examined a wide range of technical concerns over the implementation of the new system. The number and depth of Committee stage amendments which I shall move later this afternoon will reflect the care and thoroughness of the deliberations in the Bills Committee.

The amendment Bill, as it now stands, is fairly complex. This complexity is to some extent inevitable given the strong desire of the Administration and the Bills Committee to close all anticipated loopholes and to set out clearly in law how the new system will operate. The Bill is now a good piece of new legislation which meets more fully the objectives we have set for this reform exercise. We are, however, conscious of a possible need for further improvements after we have seen the new scheme in full operation. The review which we have undertaken to conduct in a year’s time will serve this useful purpose.

The new FRT system will require those running a business of importing and distributing motor vehicles for use in Hong Kong to register with the Customs and Excise Department. Following registration, motor traders will have to publish a list of the retail prices of all models of motor vehicles which they are offering for sale. The Commissioner for Transport will then calculate the FRT payable on a vehicle on the basis of its published retail price. Anybody who sells a motor vehicle at a price higher than its taxable value plus the value

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4343

of the tax exempt elements without first seeking the Commissioner for Transport’s consent will commit an offence.

Under the proposed scheme, aspiring car owners will have a much clearer idea of the amount of FRT they will be paying for the cars of their choice. The Commissioner for Transport will also be able to determine the proper amount of FRT payable by reference to a readily available taxable basis. One of the amendments which I shall move later this afternoon will empower the Commissioner of Customs and Excise to challenge published retail prices which he considers as not reflecting the market value or which are constructed in a way to avoid tax. The need for such anti-avoidance provisions is well recognized for trade in such valuable items as motor vehicles. At the same time, we shall provide an appeal channel for distributors to ask the Administrative Appeals Board to review the Commissioner of Customs and Excise’s determination. I should emphasize that it is not the Administration’s intention to set retail prices ― the market will continue to operate freely: but we need an effective mechanism to tackle any attempt to avoid tax.

The primary purpose of the Bill is to protect the integrity of the FRT system, not to raise additional revenue. The Commissioner for Transport has devised a schedule of FRT rates, based on a sliding scale of published retail prices. The schedule aims to achieve the effect that the new legislation, taken as a whole, is designed to be revenue-neutral. For models where importers have under-declared their values, the FRT payable under the new scheme will face a significant increase depending on the degree of under-declaration. This is a natural consequence of the rectification of a tax avoidance loophole. We expect that the prices of other models will rise or fall only marginally.

In our discussions with the Bills Committee, Members have requested the Administration to monitor the impact of the new scheme on car prices so as to find out whether the FRT rates are appropriately pitched and whether we can indeed maintain revenue neutrality in overall terms. I would like to put on record our undertaking to review the operation of the new tax system in a year’s time. In giving this undertaking, Members should be fully aware that I am not binding the Administration not to raise the new FRT rates in the meantime, whether for fiscal or transport reasons, should the need arise.

In formulating the Bill, we have taken full account of the special transport needs of disabled drivers. In response to the Bills Committee’s suggestion, as mentioned by the Honourable Andrew WONG, we have decided to go beyond the existing FRT concessions to disabled drivers. I shall move an amendment to achieve this.

Subject to Members’ endorsement, I propose to implement the Bill in two stages. For the first stage which will commence on 1 July, the Commissioner of Customs and Excise will register all local motor vehicle importers and distributors and require them to submit returns on imported vehicles and to publish retail prices. The full scheme will come into operation on 1 August

4344 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

whereupon the new schedule of FRT rates and the new formula for calculating FRT will take effect. The Committee stage amendments will cover the transitional arrangements so that we have a clear mechanism for calculating the FRT for vehicles sold before the commencement of the amendment Ordinance but registered after the new scheme is in full force.

Buyers who have already entered into contract to buy a new car for delivery after the new implementation of the new FRT system may wish to know whether they will be liable to additional FRT. For this purpose, the Commissioner for Transport has prepared a list, showing the FRT payable on the more popular models available in the market under the old and new systems. This list will be displayed in the Hong Kong Licensing Office starting from 1 July this year. It is, of course, for indication purpose only. Those who feel that the distributor may have taken the opportunity to put up prices under the pretext of a higher FRT liability under the new system may then file a complaint with the Consumer Council for further investigation.

To help the motor trade switch to the new system, the Commissioner for Transport has also prepared a Practice Note to clarify how the Bill will operate in practice. The Practice Note sets out clearly the responsibilities of motor vehicle importers and distributors, the procedures for first registration of motor vehicles as well as the respective responsibilities of the Commissioner for Transport and the Commissioner of Customs and Excise. It further clarifies how the Commissioner for Transport will use his discretion in interpreting key provisions of the law. This is in addition to the continuous dialogue we have maintained with the motor trade throughout the formulation of the amendment Bill. We will continue to liaise with them to ensure the smooth implementation of the new scheme. I should also mention that we have received valuable advice from the Consumer Council on the operation of the new system. The Bill, as amended, marks a clear step forward in the protection of consumers’ rights.

Mr President, I commend this Bill to the Council, subject to the amendments which I shall move shortly.

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

Bill read the Second time.

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

Committee Stage of Bills

Council went into Committee.

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4345

COMMISSIONER FOR ADMINISTRATIVE COMPLAINTS (AMENDMENT) BILL 1993

Clauses 1, 4 to 7, 11 to 13, 15 and 16 were agreed to.

Clauses 2, 3, 8, 9 and 10

MR LEE WING-TAT: Mr Chairman, I move that the clauses specified be amended as set out in the papers circulated to Members.

I move these Committee stage amendments to the Commissioner for Administration Complaint (Amendment) Bill 1993 in order to empower the Commissioner himself to initiate the investigation of administrative action by scheduled organizations.

Before the Administration commenced a review of the COMAC Ordinance in mid 1992, the Commissioner at that time was asked for his views regarding possible improvements to the structures and powers of COMAC. After meeting several government and community organizations in Hong Kong, as well as ombudsmen from other jurisdictions, Commissioner Arthur GARCIA provided nine suggestions, only three of which were accepted by the Government and now form the basis of the COMAC Bill.

One proposal which Mr GARCIA put forward in 1992, but which was ultimately rejected by the Government, was to permit the Commissioner to initiate investigations on his own volition. He wrote in the COMAC annual report for 1992 and I quote:

“This proposal is not novel but follows precedents, for example, ombudsmen in all Australian states, New Zealand, the majority of Canadian provinces and the Republic of Pakistan.”

In all these jurisdictions the counterpart to COMAC has the power to identify and investigate maladministration without first receiving a specific protest from an identifying complainant.

Giving the Commissioner this power of self-initiated investigation is the only way to combat abuses or misuses of power, that for some reason do not need aggrieved individuals to file written complaints with COMAC. In some cases maladministration may not affect the interests of any particular individual, or people may prefer to address their complaints to COMAC anonymously rather than under their names. Individuals may also feel that it is too time consuming or cumbersome to file written comments with COMAC and it would not be surprising if these people turned out to be from the marginalized and less affluent sectors of our society.

In all these circumstances government officials may be severely abusing the powers but in the absence of written complaints addressed to COMAC, there

4346 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

is nothing under current law that the Commissioner can do. Note that the COMAC Bill, if passed unamended, will not in any way rectify the situation, since direct access to COMAC still necessitates a written complaint.

There have been objections to giving the Commissioner this power because first, it will make him a judge in his own case, and second, he will find it practically too difficult to investigate any administration without an individual’s complaint to focus his efforts. However, experience in other jurisdictions have proven that these criticisms are without justifications.

Given the independent status of COMAC and its office’s high level of professionalism over the past five years, it is unlikely that COMAC will spend valuable time resources on frivolous investigations.

Mr President, it is clear that if we were to have an effective and efficient COMAC that is capable of correcting maladministration in the Government, he must have the power to initiate his own investigations. In the words of an ombudsmen cited by Mr GARCIA in his 1993 COMAC annual report, and I quote:

“I do not see how an ombudsman can be, or call himself, an ombudsman without it. It is basic”.

Thank you, Mr Chairman.

Proposed amendments

Clause 2

That clause 2 be amended, by deleting “of the Commissioner for Administrative Complaints Ordinance (Cap. 397)”.

Clause 3

That clause 3(a) be amended, by deleting the proposed section 7(1) and substituting ―

“(1) The Commissioner may investigate any action taken by or on behalf of an organization in the exercise of its administrative functions in any case where -

(a) a complaint is made by a person who claims to have sustained injustice in consequence of maladministration in connection with that action; or

HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994 4347

(b) notwithstanding that no complaint has been made to him, he is of the opinion that any person may have sustained injustice in consequence of maladministration in connection with that action.”.

Clause 8

That clause 8 be amended, by deleting the proposed section 16A(1) and (2) and substituting ―

“(1) After making an investigation into any action the Commissioner may, if he is of the opinion that it is in the public interest so to do, publish a report on the investigation in such manner as he thinks fit.

(2) A report published under subsection (1) shall not be prepared in such manner that the identity of -

(a) any person aggrieved;

(b) any complainant; or

(c) any officer of the organization whose action is the subject of the investigation or who is otherwise involved in the investigation,

can be ascertained from the report.”.

Clause 9

That clause 9 be amended, by deleting paragraph (a) and substituting ―

“(a) in subsection (1) by repealing”, the Commissioner shall inform the complainant and the Member of the Legislative Council by whom the complaint was referred,” and substituting “upon complaint, the Commissioner shall inform the complainant”;”.

Clause 10

That clause 10 be amended, by deleting paragraph (a) and substituting ―

“(a) in paragraph (a) by repealing everything after “for the purpose of” and substituting “an investigation under this Ordinance, or for the purposes of section 16, 16A, 17 or 22;”; and”.

Question on the amendments proposed.

4348 HONG KONG LEGISLATIVE COUNCIL ― 15 June 1994

CHIEF SECRETARY: Thank you, Mr Chairman. I have already explained in my speech commenting the resumption of the Second Reading debate why we feel unable to support Mr LEE Wing-tat’s amendments.

In brief, we do not support the proposed amendments because we believe that they will cause operational difficulties to COMAC, jeopardize the perception of his impartiality and expose him to unwarranted pressures. It is important, in our view, that COMAC should focus his resources on investigating complaints lodged by members of the public who believe that they have suffered injustice as a result of alleged maladministration.

Question on Mr LEE Wing-tat’s amendment to clauses 2, 3, 8, 9 and 10 put. Voice vote taken.

CHIEF SECRETARY: Mr Chairman, I claim a division.

CHAIRMAN: Council will proceed to a division

CHAIRMAN: The question for the Committee is whether Mr LEE Wing-tat’s proposed amendments to clauses 2, 3, 8, 9 and 10 of the Commissioner for Administrative Complaints (Amendment) Bill 1993 be approved. Will Members please proceed to vote?

CHAIRMAN: Are there any queries? If not, the results will now be displayed.

Mr Allen LEE, Mrs Selina CHOW, Mr HUI Yin-fat, Mr Martin LEE, Mr SZETO Wah, Mr LAU Wong-fat, Mr Edward HO, Mrs Peggy LAM, Mrs Miriam LAU, Mr LAU Wah-sum, Mr Jimmy McGREGOR, Mrs Elsie TU, Mr Peter WONG, Mr Albert CHAN, Mr CHEUNG Man-kwong, Rev FUNG Chi-wood, Mr Frederick FUNG, Mr Michael HO, Dr HUANG Chen-ya, Dr Conrad LAM, Mr LAU Chin-shek, Miss Emily LAU, Mr LEE Wing-tat, Mr Fred LI, Mr MAN Sai-cheong, Mr Steven POON, Mr Henry TANG, Mr TIK Chi-yuen, Mr James TO, Dr YEUNG Sum, Mr Howard YOUNG, Mr WONG Wai-yin, Dr TANG Siu tong, Miss Christine LOH, Ms Anna WU and Mr Alfred TSO voted for the amendments.

The Chief Secretary, the Attorney General, the Financial Secretary, Mr PANG Chun-hoi, Mr TAM Yiu-chung, Mr Andrew WONG, Mr Vincent CHENG, Mr Marvin CHEUNG and Mr Timothy HA voted against the amendments.