ENG-2008 — Page 107

The Economy 63

Fees and charges for services provided by government departments generated about $12.3 billion, or about 3 per cent of total revenue, in 2007-08. It is government policy that fees, in general, should be set at levels sufficient to recover the full cost of providing the services. Certain essential services are, however, subsidised by the Government or provided free of charge. Government-operated public utilities generated about $3.3 billion, which accounted for about 1 per cent of total revenue; the most important of these, in revenue terms, is water charges.

The Government also collected $27.9 billion from investments and interest income on the fiscal reserves in 2007-08, amounting to about 8 per cent of the total revenue.

Lastly, some $62.3 billion, or about 17 per cent of the total revenue in 2007- 08, was generated from land transactions. All revenue from land transactions is credited to the Capital Works Reserve Fund to help finance the Public Works. Programme.

Government Procurement and Supplies Management

Hong Kong, China is a signatory to the World Trade Organisation Agreement on Government Procurement (WTO GPA). Government procurement is undertaken in accordance with the principles of openness, transparency, fairness, public accountability, value for money and non-discrimination. Open tender procedures are widely used while restricted or single tender procedures may be used under exceptional circumstances where open competitive tendering would not be an effective means, such as in cases involving compatibility with existing equipment, patent or proprietary items. For complex and critical purchases, prequalification exercises may be conducted before tendering to ensure that suppliers are technically competent.

Purchases of goods and related services with values above predetermined thresholds of the WTO GPA are undertaken by the Government Logistics Department (GLD). These purchases are normally made by competitive tendering to ensure that user departments' needs are met at the best possible price, having regard to life-time cost and reliability of supply. Consideration is given to purchasing environmentally friendly products where available and appropriate.

To facilitate sourcing and market research, the GLD maintains and regularly updates the Supplier Lists comprising local and overseas suppliers for different categories of goods and services.

Notices for open and prequalification tenders are published in the Government Gazette and local newspapers, and put on the Internet. Suppliers on the relevant Supplier Lists and, in case of procurement covered by WTO GPA, consulates and overseas trade commissions will also be informed where appropriate. Subscribers to the Electronic Tendering System can download tender documents and submit tender offers electronically.

In 2008, the GLD procured and awarded contracts. on behalf of user departments with a total value of $3.92 billion. Items bought from 27 different