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people from Hong Kong Island and Kowloon are moving to the New Territories. As a result, the living habits of the population and the environmental hygienic conditions throughout Hong Kong are fast becoming more or less the same. The Urban Council and the Regional Council should therefore maintain very close liaison with each other when deciding on policies so as to enhance the administrative efficiency of the territory.
With these words, Sir, I support the motion.
DR. THE HONOURABLE KIM Y. S. CHAM (in Cantonese): Mr. Chairman, the workings of the Urban Council is often compared to that of a large company, with Urban Councillors sitting as members of the Board of Directors. Like the Articles of Association of a company, powers of the Urban Council is derived from the Urban Council Ordinance, the Memorandum of Administrative Arrangements and the set of related legislation. Despite the many subtle differences between a public body and a private organization, management principles can be applied towards the administration of a public organization like the Urban Council.
Better Delegation
Similar to business, the Urban Council does delegate some of its powers to the Director of Urban Services and his officers for administrative expedience. Given the large number of functional select committees and many sub-committees which the Council works with, it is timely to review whether decisions taken by all the committees and sub-committees can be further delegated to the Urban Service Department. It is not sensible nor good management to under-delegate and that responsibility and trust should be placed on officers of appropriate ranking. Reservation of delegated authority to claim that only the Council knows the job is conceited and inefficient. Likewise, retention of authority out of suspicion that the staff will ultimately be in control is jealously defendant. For as capable members of the Council, we should have confidence in ourselves since we are the only ones empowered to institute and modify the delegated authority.
Cost Reduction Probe
Like business, the Urban Council have a set of objectives and plans every year in the form of the annual statement of aims which we are now debating. Similar to business, the Urban Council also tries to attain an organizational structure conducive to the implementation of these plans. Here, we must bear in mind that the Urban Council is organized functionally at the top, that is, we have functional select committees responsible for our different types of services. This can be compared to a product-oriented approach where we try to provide services which meet the public needs. One can of course appreciate that functionally-based select committees tends to seek betterment of services with less emphasis on the reduction of services. Hence, the unseasoned observer may claim that the overall staff level in the organization is too high without probing
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into areas of possible reduction. It is timely for our select committees to consider cost reduction based on functional services and not just leaving it to our Management Services Sub-Unit. After all, they are the logical forum for activity and operational control.
Staff Participation
While I advocate that select committees should play an active role in initiating cost reduction programmes, there must be sufficient emphasis on the application of the various sciences and techniques used in management. Here, the Management Services Sub-Unit can play a supporting role to provide the necessary advice. The recent study on the Refuse and Junk Collection Services in the City Services Department is a good example resulting in a recurrent saving of $17 million and capital cost saving of $12 million. Although this is the result of the work by the Management Services Sub-Unit, the study will be most effectively accomplished with the collaboration and initiation of staff at the operational level. It is important that improvements to our operations should not be decreed in a top-down fashion, but improvements should be suggested and volunteered with a bottom-up approach. Such an approach will ensure the direct participation of the staff with a sense of fulfillment and satisfaction to improve their work together with any cost cutting exercise to increase productivity. Indeed, with our dwindling financial reserve and the stagnation of our growth of rate revenue, such a task is necessary and imminently required. However, we should certainly avoid a simple across-the-board reduction without giving our staff the primary responsibility for idea generation. What I would like to see is a participative approach with our first line managers venturing to suggest, at their own initiative and with the council's support, ideas for more economical operation of our services. In turn, this should be backed up by scientific management reasoning to develop an adequate programme to improve our services.
Privatization
Following the Annual Debate last year, the suggestion to privatize some of our cleansing services during the year has revealed some initial success. Members will recall that the Urban Council delegation to the United Kingdom reported that a local authority was able to achieve significant savings through privatization. The delegation then recommended to this Council to study this concept. Preliminary indications reveal that comparable savings may be achieved by the Council. The privatization of the cleansing of public toilets and bathhouses in the Kowloon West Region resulted in contract costs of about $1.4 million against an estimated cost of $5 million. Hence, a theoretical cost saving of $3.6 million or over 70 per cent was achieved. Such substantial savings certainly justify our continued efforts to experiment further. However, care must be taken to ensure that such savings can be sustained together with the maintenance of our service standards. Hence, more in-depth analyses are necessary before a final conclusion is reached. As I pointed out last year, a series of monitoring devices are necessary to avoid deterioration of services and that
312
HONG KONG URBAN COUNCIL
people from Hong Kong Island and Kowloon are moving to the New Territories. As a result, the living habits of the population and the environ- mental hygienic conditings throughout Hong Kong are fast becoming more or less the same. The Urban Council and the Regional Council should therefore maintain very close liaison with each other when deciding on policies so as to enhance the administrative efficiency of the territory.
With these words, Sir, I support the motion.
DR. THE HONOURable Kim Y. S. CHAM (in Cantonese):-Mr. Chairman, the workings of the Urban Council is often compared to that of a large company, with Urban Councillors sitting as members of the Board of Directors. Like the Articles of Association of a company, powers of the Urban Council is derived from the Urban Council Ordinance, the Memorandum of Administrative Arrangements and the set of related legislation. Despite the many subtle differences between a public body and a private organization, management priniciples can be applied towards the administration of a public organization like the Urban Council.
Better Delegation
Similar to business, the Urban Council does delegate some of its powers to the Director of Urban Services and his officers for administrative expedience. Given the large number of functional select committees and many sub- committees which the Council works with, it is timely to review whether decisions taken by all the committees and sub-committees can be further delegated to the Urban Service Department. It is not sensible nor good management to under-delegate and that responsibility and trust should be placed on officers of appropriate ranking. Reservation of delegated authority to claim that only the Council knows the job is conceited and inefficient. Likewise, retention of authority out of suspicion that the staff will ultimately be in control is jealously defendant. For as capable members of the Council, we should have confidence in ourselves since we are the only ones empowered to institute and modify the delegated authority.
Cost Reduction Probe
Like business, the Urban Council have a set of objectives and plans every year in the form of the annual statement of aims which we are now debating. Similar to business, the Urban Council also tries to attain an organizational structure conducive to the implementation of these plans. Here, we must bear in mind that the Urban Council is organized functionally at the top, that is, we have functional select committees responible for our different types of services. This can be compared to a product-oriented approach where we try to provide services which meet the public needs. One can of course appreciate that functionally-based select committees tends to seek betterment of services with less emphasis on the reduction of services. Hence, the unseasoned observer may claim that the overall staff level in the organization is too high without probing
HONG KONG URBAN COUNCIL
Page 176 of 233
313
into areas of possible reduction. It is timely for our select committees to consider cost reduction based on functional services and not just leaving it to our Management Services Sub-Unit. After all, they are the logical forum for activity and operational control.
Staff Participation
While I advocate that select committees should play an active role in initiating cost reduction programmes, there must be sufficient emphasis on the application of the various sciences and techniques used in management. Here, the Management Services Sub-Unit can play a supporting role to provide the necessary advice. The recent study on the Refuse and Junk Collection Services in the City Services Department is a good example resulting in a recurrent saving of $17 million and capital cost saving of $12 million. Although this is the result of the work by the Management Services Sub-Unit, the study will be most effectively accomplished with the collaboration and initiation of staff at the operational level. It is important that improvements to our operations should not be decreed in a top-down fashion, but improvements should be suggested and volunteered with a bottom-up approach. Such an approach will ensure the direct participation of the staff with a sense of fulfillment and satisfaction to improve their work together with any cost cutting exercise to increase productivity. Indeed, with our dwindling financial reserve and the stagnation of our growth of rate revenue, such a task is necessary and imminently required. However, we should certainly avoid a simple across-the-board reduction without giving our staff the primary responsibility for idea generation. What I would like to see is a participative approach with our first line managers venturing to suggest, at they own initiative and with the council's support, ideas for more economical operation of our services. In turn, this should be back up by scientific management reasoning to develope an adequate programme to improve our services.
Privatization
Following the Annual Debate last year, the suggestion to privatize some of our cleansing services during the year has revealed some initial succees. Members will recall that the Urban Council delegation to the United Kingdom reported that a local authority was able to achieve significant savings through privatization. The delegation then recommended to this Council to study this concept. Preliminary indications reveal that comparable savings may be achieved by the Council. The privatization of the cleansing of public toilets and bathhouses in the Kowloon West Region resulted in contract costs of about $1.4 million against an estimated cost of $5 million. Hence, a theorectical cost saving of $3.6 million or over 70 per cent was achieved. Such substantial savings certainly justify our continued efforts to experiment further. However, care must be taken to ensure that such savings can be sustained together with the maintenance of our service standards. Hence, more in-depth analyses is necessary before a final conclusion is reached. As I pointed out last year, a series of monitoring devices are necessary to avoid deterioration of services and that
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