HONG KONG URBAN COUNCIL
many of our vehicles including RCVs and street cleansing vehicles are carried out by EMSD. EMSD charges a rather high rate in order to cover cost. I have a question for Mr. SUEN. After EMSD has set up a trading fund with independent accounts and increased its competitiveness, can the Council compare rates offered by outside sizeable vehicle maintenance companies before signing a contract with the one found with better value for money, instead of assigning vehicle maintenance work to EMSD invariably as we now do?
MR. SUEN Kai-cheong (in Cantonese):-In fact, the charges for services provided by other government departments to the Council have been assessed by the Finance Branch of Central Government. The rates are in principle designed to recover full cost. I think it may be a good idea to compare the rates offered by EMSD with market rates and carry out a review. Only then are we able to decide whether existing charges are reasonable. I think this point is worth reviewing.
Chairman (in Cantonese):—Does Mr. SUEN mean the question has to be referred to the Committee for discussion?
MR. SUEN KAI-CHEONG (in Cantonese):-Yes.
MR. WU CHI-WAI (in Cantonese):-I notice from the written reply that different departments have different indirect on-cost charges. I find it strange that certain departments charge 15% whereas others charge 5% and yet others charge 25%. How is on-cost charge set?
Another question arises from my understanding that new vehicles purchased by the Council come invariably with free maintenance service for one or two years. Is that not the case at present so that we have to assign maintenance service to EMSD? If this is the case, are we getting attractive discounts for our purchases of vehicles?
MR. SUEN KAI-CHEONG (in Cantonese):-Concerning the on-cost rate charged by different departments for services provided to us, I have just said that they are assessed by the Finance Branch of Central Government. In principle, departments have to recover full cost for services provided to us. However, as to whether the full cost is comparable to market prices, as I have said, it is something for the Administration Select Committee to review and make comparison.
For our purchase of new vehicles, if the supplier already provides maintenance service, there is no need to assign the service to EMSD. However, if we do not demand such service, vehicle suppliers may ask for lower prices than those for vehicles with maintenance service.
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HONG KONG URBAN COUNCIL
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many of our vehicles including RCVs and street cleansing vehicles are carried out by EMSD. EMSD charges a rather high rate in order to cover cost. I have a question for Mr. SUEN. After EMSD has set up a trading fund with independent accounts and increased its competitiveness, can the Council compare rates offered by outside sizeable vehicle maintenance companies before signing a contract with the one found with better value for money, instead of assigning vehicle maintenance work to EMSD invariably as we now do?
MR. SUEN Kal-cheong (in Cantonese):-In fact, the charges for services provided by other government departments to the Council have been assessed by the Finance Branch of Central Government. The rates are in principle designed to recover full cost. I think it may be a good idea to compare the rates offered by EMSD with market rates and carry out a review. Only then are we able to decide whether existing charges are reasonable. I think this point is worth reviewing.
Chairman (in Cantonese):—Does Mr. SUEN mean the question has to be referred to the Committee for discussion?
MR. SUEN KAI-CHEONG (in Cantonesc):-Yes.
MR. WU CHI-WAI (in Cantonese):-I notice from the written reply that different departments have different indirect on-cost charges. I find it strange that certain departments charge 15% whereas others charge 5% and yet others charge 25%. How is on-cost charge set?
Another question arises from my understanding that new vehicles purchased by the Council come invariably with free maintenance service for one or two years. Is that not the case at present so that we have to assign maintenance service to EMSD? If this is the case, are we getting attractive discounts for our purchases of vehicles?
MR. SUEN KAI-CHEONG (in Cantonese):-Concerning the on-cost rate charged by different departments for services provided to us, I have just said that they are assessed by the Finance Branch of Central Government. In principle, departments have to recover full cost for services provided to us. However, as to whether the full cost is comparable to market prices, as I have said, it is something for the Administration Select Committee to review and make comparison.
For our purchase of new vehicles, if the supplier already provides maintenance service, there is no need to assign the service to EMSD. However, if we do not demand such service, vehicle suppliers may ask for lower prices than those for vehicles with maintenance service.
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