OFFICIAL RECORD OF PROCEEDINGS
Wednesday, 13 December 1995
The Council met at half-past Two o'clock

MEMBERS PRESENT

THE PRESIDENT
THE HONOURABLE ANDREW WONG WANG-FAT, O.B.E., 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 MARTIN LEE CHU-MING, Q.C., J.P.

DR THE HONOURABLE DAVID LI KWOK-PO, O.B.E., LL.D. (CANTAB), J.P.

THE HONOURABLE NGAI SHIU-KIT, O.B.E., J.P.

THE HONOURABLE SZETO WAH

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

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

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

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

DR THE HONOURABLE EDWARD LEONG CHE-HUNG, O.B.E., J.P.

THE HONOURABLE ALBERT CHAN WAI-YIP

THE HONOURABLE CHEUNG MAN-KWONG

THE HONOURABLE CHIM PUI-CHUNG

THE HONOURABLE FREDERICK FUNG KIN-KEE

THE HONOURABLE MICHAEL HO MUN-KA

DR THE HONOURABLE HUANG CHEN-YA, M.B.E.

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 HENRY TANG YING-YEN, J.P.

THE HONOURABLE JAMES TO KUN-SUN

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

DR THE HONOURABLE PHILIP WONG YU-HONG

DR THE HONOURABLE YEUNG SUM

THE HONOURABLE HOWARD YOUNG, J.P.

THE HONOURABLE ZACHARY WONG WAI-YIN

THE HONOURABLE CHRISTINE LOH KUNG-WAI

THE HONOURABLE JAMES TIEN PEI-CHUN, O.B.E., J.P.

THE HONOURABLE LEE CHEUK-YAN

THE HONOURABLE CHAN KAM-LAM

THE HONOURABLE CHAN WING-CHAN

THE HONOURABLE CHAN YUEN-HAN

THE HONOURABLE ANDREW CHENG KAR-FOO

THE HONOURABLE PAUL CHENG MING-FUN

THE HONOURABLE CHENG YIU-TONG

THE HONOURABLE ANTHONY CHEUNG BING-LEUNG

THE HONOURABLE CHEUNG HON-CHUNG

THE HONOURABLE CHOY KAN-PUI, J.P.

THE HONOURABLE DAVID CHU YU-LIN

THE HONOURABLE ALBERT HO CHUN-YAN

THE HONOURABLE IP KWOK-HIM

THE HONOURABLE LAU CHIN-SHEK

THE HONOURABLE AMBROSE LAU HON-CHUEN, J.P.

DR THE HONOURABLE LAW CHEUNG-KWOK

THE HONOURABLE LAW CHI-KWONG

THE HONOURABLE LEE KAI-MING

THE HONOURABLE LEUNG YIU-CHUNG

THE HONOURABLE BRUCE LIU SING-LEE

THE HONOURABLE LO SUK-CHING

THE HONOURABLE MOK YING-FAN

THE HONOURABLE MARGARET NG

THE HONOURABLE NGAN KAM-CHUEN

THE HONOURABLE SIN CHUNG-KAI

THE HONOURABLE TSANG KIN-SHING

DR THE HONOURABLE JOHN TSE WING-LING

THE HONOURABLE MRS ELIZABETH WONG CHIEN CHI-LIEN, C.B.E., I.S.O., J.P.

THE HONOURABLE LAWRENCE YUM SIN-LING

PUBLIC OFFICERS ATTENDING

THE HONOURABLE DONALD TSANG YAM-KUEN, O.B.E., J.P. FINANCIAL SECRETARY

THE HONOURABLE JEREMY FELL MATHEWS, C.M.G., J.P. ATTORNEY GENERAL

MR CHAU TAK-HAY, C.B.E., J.P. SECRETARY FOR RECREATION AND CULTURE

MR NICHOLAS NG WING-FUI, J.P. SECRETARY FOR CONSTITUTIONAL AFFAIRS

MRS KATHERINE FOK LO SHIU-CHING, O.B.E., J.P. SECRETARY FOR HEALTH AND WELFARE

MR JOSEPH WONG WING-PING, J.P. SECRETARY FOR EDUCATION AND MANPOWER

MR BOWEN LEUNG PO-WING, J.P. SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS

MR KWONG KI-CHI, J.P. SECRETARY FOR THE TREASURY

MR FUNG TUNG, O.B.E., J.P. SECRETARY FOR HOUSING

CLERKS IN ATTENDANCE

MR RICKY FUNG CHOI-CHEUNG, SECRETARY GENERAL

MR LAW KAM-SANG, DEPUTY SECRETARY GENERAL

MISS PAULINE NG MAN-WAH, ASSISTANT SECRETARY GENERAL

MR RAY CHAN YUM-MOU, ASSISTANT SECRETARY GENERAL

PAPERS

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

Subject

Subsidiary LegislationL.N. No.

Road Traffic (Public Service Vehicles) (Amendment) (No. 5) Regulation 1995 562/95

Hong Kong Airport (Restricted Areas and Tenant Restricted Areas) Order563/95
Road Traffic (Breath Analysing Instruments and Screening Devices) Notice564/95
Toys and Children's Products Safety (Safety Standards) Notice565/95
Official Languages (Authentic Chinese Text) (Road Tunnels (Government) Ordinance) Order(C) 118/95
Official Languages (Authentic Chinese Text) (Tate's Cairn Tunnel Ordinance) Order (C) 119/95

Sessional Papers 1995-96

No. 37─The Prince Philip Dental Hospital Hong Kong Report by the Board of Governors for the period 1 April 1994 - 31 March 1995
No. 38─Ocean Park Corporation Annual Report 1994-95
No. 39─Emergency Relief Fund Annual Report by the Trustee for the year ending on 31 March 1995
No. 40─ Social Work Training Fund Thirty-fourth Annual Report by the Trustee for the year ending on 31 March 1995
No. 41─ Chinese Temples Fund Income and Expenditure Account with Balance Sheet and Certificate of the Director of Audit for the year ended 31 March 1995
No. 42─ General Chinese Charities Fund Income and Expenditure Account with Balance Sheet and Certificate of the Director of Audit for the year ended 31 March 1995
No. 43─ Report of the Brewin Trust Fund Committee on the Administration of the Fund for the year ended 30 June 1995
No. 44─ Grantham Scholarships Fund Income and Expenditure Account with Balance Sheet and Certificate of the Director of Audit for the year ended 31 August 1995
No. 45─ Queen Elizabeth Foundation for the Mentally Handicapped Report and Accounts 1994-95
No. 46─ The Accounts of the Lotteries Fund 1994-95
No. 47─ Hong Kong Housing Authority 1994-95 Annual Report
No. 48─ Hong Kong Housing Authority Annual Accounts for the year ended 31 March 1995 and Balance Sheet as at that date

ORAL ANSWERS TO QUESTIONS

Mother Tongue as Medium of Instruction in Secondary Schools

1.MR IP KWOK-HIMasked (in Cantonese): Mr President, according to the findings of a research conducted by the Education Department, it is more appropriate for about 70% of Form One students to receive education in their mother tongue, but there are only 100 secondary schools (accounting for less than 20% of all the secondary schools in the territory) which have adopted the mother tongue as the medium of teaching. In this connection, will the Government inform this Council:

  1. whether it has promoted the importance of mother-tongue teaching to parents of secondary school students; if so, what are the details, and what achievement it has made in this regard; and
  2. what plans does the Government have to make more schools accept and adopt mother tongue teaching?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, the Government's policy is to encourage secondary schools to adopt Chinese as the medium of instruction, to allow individual schools to exercise discretion in the choice of their medium of instruction after taking into consideration whether their students can learn effectively in Chinese or English, and to strongly discourage the use of mixed code in schools. This policy is based on the following considerations:

  1. that teaching and learning are generally more effective through the mother tongue; and
  2. that while students can learn more effectively in their mother tongue, those who have the ability to learn effectively in English should be given the opportunity to do so if they so wish.

Since 1994, parents of Primary six students have been provided with information on their children's language ability in Chinese and English. Schools have since been categorized into three groups as follows:

  1. schools which should use Chinese as the medium of instruction;
  2. schools which may use either Chinese or English as the medium of instruction; and
  3. schools which may use Chinese or English for some classes and should use Chinese only for other classes as the medium of instruction.

At the same time, the Education Department has been vigorously promoting the benefits of mother tongue teaching by:

  1. publicizing the results of research studies undertaken by the Education Department in conjunction with the University of Hong Kong and the Chinese University of Hong Kong between 1987 and 1994 on using the mother tongue as the medium of instruction. These studies indicated that students generally learned and performed better with their mother tongue adopted as the medium of instruction, particularly in language-loaded subjects. Abstracts of these results have been distributed to all kindergartens, and primary and secondary schools. The Education Department has also produced video tapes on the basis of the information concerned. Starting from 1995, such information is also given, in the form of pamphlets, to all parents of Primary six students who will have to choose a secondary school for their children;
  2. producing posters for schools to display on parents' days;
  3. holding roving exhibitions to explain the Government's policy on medium of instruction and the findings of the relevant research studies; and
  4. organizing seminars for secondary school headmasters on how to effectively implement mother tongue teaching.

As a result of these efforts, the number of schools adopting Chinese as the medium of instruction for all subjects except English has increased from 52 in 1994 to 69 this year. In fact, some 280 secondary schools or 70% of all the secondary schools use Chinese as the medium of instruction to varying degrees. Of these, some 150 schools use Chinese for most of the subjects.

To encourage more schools to use Chinese as the medium of instruction in the coming years, the Education Department will continue to adopt preferential measures which include -

  1. providing additional teachers of English, movable partitions, wirefree induction loop systems as well as one-off library grants to enhance English teaching and learning;
  2. providing training courses to prepare teachers to teach in Chinese;
  3. providing incentives for publishers to produce good quality Chinese textbooks in various subjects ─ the Finance Committee of this Council has recently approved $54 million for implementing phase four of the incentive scheme; and
  4. compiling glossaries of technical terms in both Chinese and English for major subjects.

In addition, the Education Department is currently conducting a three-year longitudinal study starting in 1994 to gauge the effects of different modes of medium of instruction on the academic achievement and learning process of Form One to Form Three students. Based on these findings, we will formulate and issue to schools clear-cut guidelines in 1997 on the appropriate medium of instruction to be adopted from September 1998 onwards.

These efforts will be reinforced by the following publicity activities to be launched by the Department in this fiscal year of 1995-96:

  1. To organize eight seminars on the benefits of mother tongue teaching for primary school teachers in the hope that they will pass the message on to pupils and parents;
  2. To produce television programmes and Announcements of Public Interest (API) on radio, targeting specially on parents;
  3. To put up posters at MTR stations;
  4. To prepare and distribute new pamphlets to parents of Primary Four to Primary Six students; and
  5. To publicize, through the mass media, successful examples of schools adopting mother-tongue teaching, particularly the outstanding achievements of their students with a view to promote mother-tongue teaching.

The total cost of these activities is estimated at $2.6 million.

MR IP KWOK-HIM (in Cantonese): Mr President, I would like to know more about the three-year longitudinal study which commenced in 1994 that the Secretary for Education and Manpower has mentioned earlier. He said that this study sought to assess different modes of medium of instruction. I would very much like to know clearly the content of this study. Can the Secretary provide more detailed information? What specific measures can the Administration take subsequent to the completion of the study to render mother-tongue teaching more acceptable to parents?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, this study which began in 1994 and which has mainly used 60 schools as samples, seeks to examine the progress of learning of students from Form One to Form Three who are taught in different modes of medium of instruction. The main purpose of this is that we would very much like to see the findings of this study match our previous studies, thus proving that the academic achievements of students learning through their mother tongue in this period (from Form One to Form Three) are better than students being taught under the so-called mixed code teaching approach. We will subsequently implement the guidelines which have already been issued to schools on the basis of the findings. Under the guidelines which we have issued to schools, as I have explained in the main reply, it is stated that some schools should use Chinese as the medium of instruction, some may use either Chinese or English while some should use Chinese only for some classes and use English or Chinese for other classes for better results. We very much hope that the findings of the study will further boost the confidence of schools and particularly parents in the effectiveness of mother-tongue teaching so that we can issue in 1997 a set of clear-cut guidelines as I have mentioned in the main reply, advising all schools to observe the guidelines of the Education Department and formally implement the policy of mother-tongue teaching across the board from the 1998 school year onwards.

PRESIDENT: I have four more names on my list and I draw a line there.

MR CHEUNG MAN-KWONG (in Cantonese): Mr President, it is mentioned in the main reply that the Government plans to issue a clear-cut guideline in 1998 to schools which are suitable only for mother-tongue teaching, asking these schools to adopt mother-tongue teaching for the benefits of their students. Can the Government inform this Council whether this clear-cut guideline is binding or is it just a "toothless tiger"? If these schools do not comply with this guideline of the Education Department, what measures will the Government take to ensure compliance?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, the guidelines will be issued in 1997, which is, in other words, two years away. We very much hope that in the next two years, through the series of measures and promotional campaigns that I have discussed in the main reply, an increasing number of schools will follow our guidelines by adopting the kind of language that we suggest to them as the medium of instruction. In consideration of the point that the Honourable CHEUNG Man-kwong raised just now, I will look into the need to draw up certain rules when the guidelines are issued in 1997. Of course, I can say that where secondary schools in Hong Kong are concerned, public secondary schools in particular, some of them are government schools and some are subsidized by the public fund. If we need to make the guidelines binding in implementation, even though the guidelines are not legally binding, there will certainly be other alternatives that we can consider to achieve this end. However, I do not wish to make a decision now regarding to what extent the guidelines are binding because I very much hope that through our on-going efforts, more and more schools will accept the guidelines that we have already issued to them.

MR LEUNG YIU-CHUNG (in Cantonese): Mr President, I would like to follow up part (b) of the question. At present, secondary schools or secondary school teachers have found it rather difficult to accept mother-tongue teaching. The reason for that, I believe, relates to the medium of instruction at our universities because at present, as the Secretary for Education and Manpower has mentioned, it is not compulsory for our universities to adopt a particular kind of language as their medium of instruction. This has puzzled secondary school teachers who are at a loss as to how the medium of instruction used in secondary schools can be linked up to that used at our universities. There are difficulties in the convergence of the medium of instruction particularly in subjects such as science, mathematics or natural science. May I ask the Secretary this: while secondary school teachers and secondary schools are being talked into adopting mother-tongue teaching in their schools, how can the Administration convince them that the difficulties faced by their students in respect of the medium of instruction used at our universities will be eliminated?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, from what I understand as the main point of Mr LEUNG's question, he is, perhaps, worried that students who study in Chinese-medium secondary schools may face certain difficulties when they go to university. I, however, do not quite agree with him. It is because basically, we have conducted a lot of studies and we have been telling parents since 1994 that in actual fact, some 33% of students in the territory can learn through either Chinese or English while a majority of the rest of the students should learn through their mother tongue, namely Chinese, in secondary schools. For students who learn through Chinese, I think they would not have problems in other disciplines when they study at university because there are such reference books as bilingual glossaries of technical terms. I have to stress that the mother-tongue teaching approach that I have presented just now does not mean that the subject of English must also be taught in Chinese. The subject of English can be taught in English. Therefore, the point I am making is that learning through the mother tongue does not necessarily mean a lowering of the English standard. Besides, as I have mentioned in the main reply, the Government will provide plenty of support to Chinese-medium schools, which includes additional teachers of English.

MRS SELINA CHOW (in Cantonese): Mr President, as the Secretary for Education and Manpower has mentioned just now that while suggestions have been made to schools, very few schools seem to have adopted mother-tongue teaching of their own accord. There are a mere 69 schools which have adopted such approach so far while 70% of the schools have not yet accepted this approach. While that clear-cut guideline is to be issued only in 1998, can it be put across to schools earlier, telling them that this policy will definitely be implemented in 1998 so that they can make a choice earlier and actively change their language policy?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, as a matter of fact, all secondary schools know well and have received from the Education Department instructions as to which language, be it Chinese or English, should be adopted as the medium of instruction. Therefore, all schools are already aware of the guidelines. But why do we have to issue a set of guidelines in more explicit terms in 1997? As I have stated in the main reply, it is because a three-year longitudinal study was launched in 1994, seeking to collect data that are objective and which should be more convincing to both schools and parents to prove that learning through the mother tongue is effective indeed. Given that the study which started in 1994 will take three years, we can only have the findings in 1997. Such being the case, I hope to issue the clear-cut guidelines only in 1997 to dovetail with the findings of this three-year study. Yet, it does not mean that we are going to stop the measures in the interim. We will, as I have mentioned in the main reply, continue with the promotional and supportive measures concerned in order to encourage more schools to observe our guidelines.

MR ANTHONY CHEUNG (in Cantonese): Mr President, although the Secretary for Education and Manpower has mentioned in his reply just now that some research studies showed that students who are taught in their mother tongue have demonstrated better performance in learning and that the Government has provided additional resources to support mother-tongue teaching in schools, the reality is that a great majority of secondary schools are reluctant to fully adopt the mother tongue as the medium of instruction. What are the reasons for this? Is it due to resistance from parents who are reluctant to let their children learn in their mother tongue? Are they worried that their children may face difficulties when they go to university; or is it because of reservations on the part of employers? Has the Government formulated any plans before, or does it have any at present, to conduct substantial studies in an effort to solicit the opinions of the community, including those of employers, universities or parents on mother-tongue teaching?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, the question raised by Mr CHEUNG consists of several parts. First, he asked why many schools remain unwilling to observe the guidelines of the Education Department and adopt mother-tongue teaching. This is due to a number of reasons. Of course, on the one hand it is because of the attitude of parents, many of whom tend to feel that English-medium teaching will help improve their children's proficiency in English and this will be advantageous to their children in further studies and in seeking future employment. Another reason, which correlates with the above, is that some schools believe that if they switch from English-medium to Chinese-medium teaching, they might end up having to accept students with a lower academic standard owing to the attitude of parents in choosing schools for their children.

As to how we are going to allay their anxieties, first of all, as I have mentioned in the main reply, we will on the one hand publicize the effectiveness of mother-tongue teaching through promotional campaigns and on the other hand, as we have already mentioned, there is the three-year longitudinal study. We hope that more convincing and objective information will be obtained to prove the effectiveness of mother-tongue teaching. In the meantime, I also have to emphasize that we will continue to convey the message to parents that mother-tongue teaching will not in the least lower the students' English standard because the lowering of English standard may be due to a diversity of factors. Moreover, despite mother-tongue teaching, the subject of English can still be taught through the medium of English. In this connection, we will reinforce this message to parents.

Hospital Authority Merit Payments to Senior Staff

2. MR CHAN WING-CHANasked (in Cantonese): Mr President, will the Government inform this Council:

  1. whether merit payments are granted to senior executives of the Hospital Authority; if so, what are the criteria for granting such payments, which types of executives are eligible for receiving such payments, and what is the basis for determining the amount granted; and
  2. of the annual amount appropriated for such payments by the Hospital Authority over the past three years?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, the Chief Executive and Hospital Chief Executives are senior executives of the Hospital Authority whose remuneration contains a performance related element. Such payments are determined by assessment panels set up to evaluate the overall performance of individual executives in discharging their management duties and achieving agreed service targets.

In the case of Hospital Chief Executives, the assessment panel comprises members of the Hospital Authority Board as well as the respective Hospital Governing Committees, and the payment ranges from 0% to 15% of pay. In the case of the Chief Executive, the assessment panel comprises Hospital Authority Board members, and the payment ranges from 0% to 30% of pay.

The amounts of performance related payments granted by the Hospital Authority in 1992-93, 1993-94 and 1994-95 were in the order of $0.6 million, $4 million and $7 million respectively.

MR CHAN WING-CHAN (in Cantonese): May I ask the Government if it is appropriate to set up this merit payment scheme for the Hospital Authority? If the Government considers this merit payment scheme appropriate, why is it that only a small handful of people in the higher echelons are eligible for this payment? Does the Hospital Authority think that other than this small handful of people, the efforts of other members of staff are not worthy of commendation and reward?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, this merit payment seeks to provide a mechanism to ensure that the performance of senior executives is up to a certain standard. In this connection, it is necessary to establish an administrative framework and set certain targets. This is a scheme drawn up by the Hospital Authority with the approval of the Government. Under the circumstances, it is an internal administrative decision of the Hospital Authority that such payment is made to senior executives and not to be granted to other members of staff.

PRESIDENT: I have four more names on my list and I draw a line there. May I again remind Members to keep their supplementary single-barrelled and keep the preambles very, very short indeed.

MR CHAN KAM-LAM (in Cantonese): Mr President, at present, a great majority of the Government's appropriation to the Hospital Authority and the main revenue of hospitals is spent on expenses relating to manpower and staffing matters. Under this system, how can the Government prevent individual executives who seek to procure a higher merit payment from deliberately suppressing departmental expenditures so that the money will go into the pockets of these executives?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, the performance related payment is meant to reward those members of staff who can meet the targets of improving the services. This payment is drawn from the money set aside for remuneration at a designated rate. Therefore, no extra expenses will be incurred. Nor will it have any impact on the expenditure required for the provision of services to patients. The Hospital Authority has a mechanism in place to determine the eligibility of their staff for this merit payment. As I said in the main reply, in the case of the Chief Executive, an assessment panel under the Hospital Authority Board is set up and in the case of Hospital Chief Executives, a panel comprising members of the Hospital Authority Board and the respective Hospital Governing Committees is set up to assess their eligibility. Therefore, I believe there is adequate information provided for the assessment and this payment will not jeopardize the services to patients.

MISS CHAN YUEN-HAN (in Cantonese): Mr President, I am not challenging the management system of the Hospital Authority. However, the fact is that rumours are spreading in the community. From the figures just presented to us by the Government, the granting of this payment alone in 1994-95 already amounted to $7 million. If we calculate on the basis of the data that the Government has provided us earlier which indicate that there are 40 executives in the senior management level, 40 people sharing this $7 million will mean over $170,000 for each person. Given that the Hospital Authority is a non-profit-making institution, does the Government consider this merit payment scheme appropriate? I have to stress that at a time particularly when we are discussing inadequate expenditure on medical services, is it a right thing to do to adopt such a scheme?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, I think what the Honourable Miss CHAN Yuen-han has said may just be her personal opinion. But I can explain to Members that this payment has increased annually on a progressive basis because the newly introduced administrative framework is only implemented gradually. It was not commenced in full in 1992. It was only in 1994-95 that all Hospital Chief Executives required were recruited and this explains the annual increase in the payment. As for the question of appropriateness and whether this payment should be granted, the Hospital Authority can make its own decisions on the remuneration for their staff.

DR LEONG CHE-HUNG (in Cantonese): The Secretary for Health and Welfare revealed in her reply just now that the annual amount of merit payment is on the rise progressively. Does this mean that there are more and more senior executives, or that the executives are doing their jobs better and better?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): I have in fact answered half of the question. First, there has been an increase in the number of executives between 1992 and 1995. Secondly, the executives have more opportunities each year to show good performance. Thirdly, I have to point out that not all the executives will definitely be granted this payment.

MR CHOY KAN-PUI (in Cantonese): Mr President, is the morale of staff in the lower ranks affected by the merit payment and bonus scheme for senior executives of the Hospital Authority? How will the administration and operation of the Hospital Authority be affected without this scheme? In view of the concept of linking up charges with the cost, will patients be made to pay higher medical fees as a result of a rise in the cost due to this bonus system?

PRESIDENT: I think there were three questions.

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, first of all, I have to stress that the payment is not a bonus. It is a payment determined by performance and it is clearly set out in the letters of appointment that such payment is granted only on the ground of good performance. It is part of the income, not a bonus, and the Hospital Authority is, as Members have pointed out just now, a non-profit-making institution. As to the question of whether there is any impact on the morale of other members of staff, as far as I know and from the information provided to me by the Hospital Authority, the morale is not affected. The granting of this payment and the charges for medical services are two entirely different matters, which are not in the least related.

Chief Executive (Designate) and Team Designate 3.

MR LEE WING-TAT asked (in Cantonese): Mr President, as the Chief Executive (Designate) and Principal Officials (Designate) the Team Designate will be appointed in 1996, will the Government inform this Council:

  1. what is the composition of the Team Designate as the Government understands it;
  2. whether, in regard to providing assistance to the Special Administrative Region (SAR) Government (Designate) in its work during the transition, the Government will provide assistance to the Principal Officials (Designate), Executive Councillors (Designate) or the Team Designate as a whole in addition to providing assistance to the SAR Chief Executive (Designate);
  3. in what ways will such assistance be given; and
  4. whether the Government will urge the British Government to request the Chinese Government to state clearly that the secretariat consisting of a few hundred staff proposed to be set up by a member of the Preliminary Working Committee (PWC) to provide assistance to the Chief Executive (Designate) will not result in the existence of a "shadow government", and whether the Government will request the British Government to clarify if the PWC's proposal contravenes Section four of the Sino-British Joint Declaration?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, it is not for the Hong Kong Government to define for the Chinese side what the term "Team Designate" stands for. The only occasion that this term had been explained to us was in the context of discussions on the Court of Final Appeal. On that occasion, the Chinese side told us that the Team Designate would be led by the Chief Executive (Designate) and would include the Principal Officials (Designate) and others qualified to take part in the establishment of the Court of Final Appeal.

It is obviously in Hong Kong's interests to ensure that the transition will be as smooth as possible. It is, therefore, essential that we render assistance to the Chief Executive (Designate). In the Governor's policy address, we have already undertaken to do so. The details and the form of such assistance will need to be discussed with the Chinese side.

Under the Joint Declaration, the administration of Hong Kong before 1997 will remain a British responsibility. We have made it clear that we will maintain effective administration of the territory and will not accept any parallel or shadow government. We have noted from recent press reports that the Chinese side have affirmed their support for this principle and that there should not be an alternative centre of power before 30 June 1997.

MR LEE WING-TAT (in Cantonese): By this time next year, there will be many organizations relating to the transition of the Hong Kong Government emerging, including the Preparatory Committee. The Chief Executive (Designate) will be known; and the Executive Councillors (Designate) and Principal Officials (Designate) after 1997 may be appointed in parallel with the existing Administration. How can the Secretary for Constitutional Affairs assure us that the discussions of these many organizations and the views they openly express will not interfere with the operation of the Hong Kong Government and will not affect the effectiveness and the authority of the existing Government in governing Hong Kong, as consistently emphasized by the Chief Secretary?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, I would like to reiterate and stress again the provision in the Joint Declaration. It provides very specifically and very clearly that the administration of this place would be the responsibility of the British Government before 1 July 1997. So there is no question of us abdicating; there is no question of us being confused or confounded by discussions or happenings elsewhere. We would continue to maintain a very effective administration of this place before l July 1997.

PRESIDENT: I have four more names on my list, and I will draw a line there.

DR YEUNG SUM (in Cantonese): Mr President, since the Government will establish a liaison office to maintain co-operation with the Team Designate, can the Government inform this Council how such liaison office will report to Members of the Legislative Council? Will it consult Members before any important decision is made?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, as I have explained to Members of the Constitutional Affairs Panel on a number of occasions and as the Governor has indeed also explained in his previous Question and Answer session, our assistance to the Preparatory Committee and in future the Chief Executive (Designate) will be on the principle of openness and transparency and we certainly would keep the Legislative Council fully in the picture of the Hong Kong Government's activities in relation to co-operating with the Preparatory Committee. Of course, it is not the Hong Kong Government's responsibility to explain on behalf of the Preparatory Committee what it does, how it operates and why it operates in a particular fashion. But insofar as the Hong Kong Government's co-operation with the Preparatory Committee is concerned, we would certainly keep Legislative Council Members and the community at large generally informed of our activities. And I would like to also remind Members that our co-operation with the Team Designate, the Preparatory Committee and the Chief Executive (Designate) will be on the three important principles. Firstly, we would not do anything that would be against the Joint Declaration and the Basic Law. We would not do anything that would compromise the Hong Kong Government's commitment to governing this place effectively before 1 July 1997, and we certainly would not do anything that would put civil servants into a position of double or conflicting loyalties.

PRESIDENT: Are you claiming your question has not been answered, Dr YEUNG?

DR YEUNG SUM (in Cantonese): Yes, I am, Mr President. It is because I have also asked the Secretary whether Members of the Legislative Council will be consulted before any important decision is made.

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, I do not quite understand what Dr YEUNG means by "before any important decision is made". Certainly, any decision made by the Preparatory Committee is not a responsibility of the Hong Kong Government. But insofar as how we co-operate, how we help the Preparatory Committee, we have made a commitment that we will certainly keep the community at large, including the Legislative Council, informed of developments. So there is no question of us making a decision on a particular subject. The general mode of co-operation, the general method of co-operation, the general system of co-operation obviously is something that we would let the Council and community know about, and our activities would be fully transparent and fully open. So it is not a question of us doing anything secretly.

MR CHIM PUI-CHUNG (in Cantonese): Mr President, under the existing system of the British Government, the ruling Conservative Party invariably forms its cabinet. The opposition party, namely the Labour Party, also has its shadow cabinet. This should be particularly the case for Hong Kong, which is now in a transition period in the run-up to 1997. In this connection, does the Government consider the establishment of a shadow government or cabinet reasonable and necessary so long as these organizations do not influence the operation of the existing Hong Kong Government?

PRESIDENT: Mr CHIM, are you seeking an opinion from the Secretary, or are you asking for the Government's position on the existence of a Preparatory Committee?

MR CHIM PUI-CHUNG (in Cantonese): Mr President, I raised this question mainly because of the strong resistance of the Government to a shadow cabinet or government. But if these organizations do not affect the operation of the Government, it should be unnecessary to put up any resistance to them. So what is the attitude of the Government towards a shadow government or cabinet which does not affect the operation of the Government?

PRESIDENT: Are you prepared to rephrase your question along my lines?

MR CHIM PUI-CHUNG (in Cantonese): Mr President, most importantly, ......

PRESIDENT: Mr CHIM, you have to rephrase your question.

MR CHIM PUI-CHUNG (in Cantonese): All right, Mr President. Let me re-organize my question. I am saying that ......

PRESIDENT: I am sorry, you have stated your view twice. You are not asking a question, you are seeking Mr NG's personal view on a term called "shadow government".

MR CHIM PUI-CHUNG (in Cantonese): Mr President, my question is this. The Secretary for Constitutional Affairs stated in paragraph three of his reply that the existence of a shadow government will not be accepted. If the so-called shadow government does not affect the operation of the Government, how will the Government deal with this issue? I would not mind if you rule that it is inappropriate for the Secretary to answer this question.

PRESIDENT: Secretary, the Government position, not your personal view please.

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, with your tolerance, I will try to answer the points raised by Mr CHIM.

We have obviously undertaken to provide the Chief Executive (Designate) with the necessary assistance to help him to prepare for the formation of the SAR Government, but the thing to remember is that prior to 1 July 1997, the administration of this place rests in the hands of the Hong Kong Government, through the British Government's responsibility and therefore any planning or preparation by the Chief Executive (Designate) and his supporting team should not undermine the authority of the current Administration and we just fail to see how the question of shadow government comes into the debate. We would be responsible for running this place before 1 July 1997, and indeed Mr CHIM should note, as mentioned in my principal answer, that the Chinese senior officials, and only last week, at least two or three of them, have recently clearly indicated that there would not be any question of a second power centre or a shadow government existing in Hong Kong before 1 July 1997.

MISS EMILY LAU (in Cantonese): Mr President, the Government said in the reply that the details and the form of assistance to be rendered to the Team Designate will need to be discussed with the Chinese side. However, neither do I believe nor accept that the Government, at this point in time, does not have any initial proposal in this regard. I have already put this question to the Chief Secretary when she was here last week. It is my hope that the Government can reveal more information to Members today. As the Government has frequently stressed the high transparency in the future operation of the Government, but if the Government refuses to tell the people of Hong Kong anything right from the start, I think nobody would believe that the Government would, in actual reality, let us know more. Therefore, Mr President, I hope that the Government can tell us right away how does the Government plan to deal with the Chinese Government and what sort of questions will be raised for discussion in an effort to provide assistance?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, I am really surprised to hear Miss LAU saying that we have not said anything about how we are going to help or co-operate with the Preparatory Committee. I will leave the Chief Executive (Designate) for the moment because obviously the Chief Executive (Designate) would have at least another year to go, or at least a long while to go before we would need to face that scenario. But insofar as co-operating with the Preparatory Committee is concerned, if Miss LAU would care to refer to the 1995 Governor's policy address, paragraphs 133 to 137, we did set out the broad framework of how we were to co-operate. We suggested that we would establish a liaison office as a focal point of contact within the Hong Kong Government, as a focal point of liaison, as a focal point of provision of information to the Preparatory Committee. Now the actual size of the liaison office and the actual detailed operation as to how many meetings we hold, are obviously some of the details that we would need to discuss and would need to unfold depending on how the Preparatory Committee would operate in detail or in actual reality. But the framework is clearly set out and the principles of that co-operation are again very clearly set out in the 1995 policy address. With those principles and within that framework, we will be able to co-operate in an effective way with the Preparatory Committee and I can assure Miss LAU that if there are major departures from that framework, from those principles, the Legislative Council will be the first organization to hear about them.

MR HOWARD YOUNG: Mr President, the Secretary for Constitutional Affairs refers in his second paragraph that the details and form of such assistance will need to be discussed with the Chinese side. I would like to know whether this is inferring that the Government plans to have the details and anything to do with assistance only discussed with the Chinese side, which I take it to mean through diplomatic channels, or will it be feasible also that once the Chief Executive (Designate) is known, then surely he should be able to directly discuss with the Hong Kong Government rather than him having to talk to Beijing, Beijing to talk to London, London to talk to Hong Kong, in a very roundabout way? Could the Secretary please clarify this point?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, we certainly do not close our mind to any possible avenues of communication with the Chinese side, on any matter affecting the transition, including of course, how we co-operate with the Preparatory Committee and the Chief Executive (Designate). Mr YOUNG is quite right in pointing out that apart from the established diplomatic channels, there are other opportunities, there are other occasions, there are other well-established avenues where we can communicate with the Chinese side, and as for his reference to when the Chief Executive (Designate) is around, that will be another avenue for us to communicate directly and more conveniently in dealing with the Chinese. It is obviously something we would bear in mind.

PRESIDENT: I will allow one more supplementary as I had overlooked the fact that Mr CHAN Kam-lam had pressed the request to speak button much earlier on.

MR CHAN KAM-LAM (in Cantonese): Mr President, the Secretary for Constitutional Affairs stated in his main reply that it is obviously in Hong Kong's interests to ensure that the transition will be as smooth as possible and it is, therefore, essential that we render assistance to the Chief Executive (Designate). Given that the officials (designate) will be appointed in 1996, may I ask the Government if it should provide the Chinese Government with information of our government officials as soon as practicable so that the Chinese side and the Chief Executive (Designate) will be able to start the work relating to the appointment of officials?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, obviously we would provide any information that is necessary or useful to help the Chief Executive (Designate) in the establishment of a new government. But I would not like, at this stage, to speculate as to what exactly would be the type of information that would be required by the Chief Executive (Designate). Our general commitment is to help him as far as we can, but against the three principles, the three broad principles that we have set out. So we would not do anything that would be against any of the three principles.

First-time Home Ownership

4.MR ERIC LI asked (in Cantonese): Since June 1994, the Government has implemented administrative measures to regulate property transactions and a curb property prices in order to enable families in need of a home to have the opportunity to purchase homes for the first time at relatively reasonable prices. In this connection, will the Government inform this Council:

  1. of the number of new residential flats completed between June 1994 and October this year;
  2. what is the number of flats for which transactions have been concluded during the above-mentioned period; whether there is information to show how many of the transactions are in respect of flats purchased by first-time home-buyers; and what is the average vacancy rate during the period in question; and
  3. whether the number of first-time home-buyers and the number of new residential flats referred to in the above-mentioned period have shown an increase when compared with the corresponding figures in each of the three years immediately before the implementation of the measures to regulate property transactions; if not, what are the reasons?

SECRETARY FOR HOUSING (in Cantonese): Mr President, since the introduction of the anti-speculation measures in June 1994,

  1. the number of new residential flats completed up to October 1995 is 76 107 units, including all private and public housing flats;
  2. the number of transactions concluded during the same period is 128 738. No separate statistics are kept on the number of transactions involving first-time home-buyers. The vacancy rate for private domestic flats, which is compiled on an annual basis, was 4.7% in 1994;
  3. the number of new residential flats competed has increased by 4%, 8% and 23% when compared with those in the past three years respectively immediately before the introduction of the new measures.

MR ERIC LI (in Cantonese): Mr President, I think my question is clear enough. It is about the supply of private housing units and their transactions. However, I am disappointed that the reply is incongruous with the question in that it has mixed up the issue with public housing. I am still unable to get a full picture of the outcome reflected by the measures taken. First of all, I hope the Administration would supply us with correct information so that the public may not be misled. The second point, though less obvious, is whether these measures have enabled families in need of a home to purchase homes for the first time. I am sure that such information is what we in this Council want to know. It has now become obvious that these measures have not only lowered the prices of private properties but also reduced their speculation activities. At the same time, the supply of medium-and long-term housing has also decreased. There are less and less suitable private residential flats to attract purchasers, resulting in the presence of many "flats without occupancy". Now, 17 months after the introduction of these measures, the Administration has the audacity to tell us that it still does not know whether or not these measures have enabled those in need of a home to purchase their own homes.

PRESIDENT: What is your question, Mr LI?

MR ERIC LI (in Cantonese): The Administration is even unable to supply us with statistics. Will the Administration assure us when it will carry out a review of the misguided policies so as to let us know, firstly, whether it will increase the supply of medium- and long-term private housing, not just land supply (unless it is the intention of the Administration that the people should sleep on streets) and secondly, whether it can supply us with correct figures to show if families in need of a home have the opportunity to purchase their own homes?

SECRETARY FOR HOUSING (in Cantonese): Mr President, the Honourable Eric LI has accused me of giving him a confused reply, but I have replied in accordance with the question asked. With your permission, I would like to provide additional information about private property transactions of the past three years or so. The numbers of transactions of private properties were 86 219 in 1992-93, 111 108 in 1993-94 and 111 832 in 1994-95.

As to providing middle-income families with the opportunity to purchase their own homes, I think the SECRETARY FOR HOUSING has on a number of occasions pointed out that there are at present various programmes to help such families to purchase their own homes. In fact, Members have already been provided with so much information on public housing that they may probably not want to hear any more about it. As to private housing, we are of the opinion that there should be enough supply of land to encourage more residential flats to be built. The Government now envisages that 195 000 private residential flats will be built by 2001, hoping that this will help families in need of a home to purchase their own homes. As to programmes to encourage families to purchase their own homes, the Government has, as you all know, gone a long way towards helping the sandwiched class, that is, the middle-income families to achieve this goal. We hope to build at least some of the residential flats for them to purchase. With the increase in the number of public and private housing units during the next few years, I am sure that families wishing to purchase their own homes will have the opportunity to do so.

PRESIDENT: Mr LI, I have to allow time for other Members. I will have to draw a line there.

MR ERIC LI (in Cantonese): Mr President, the Secretary has failed to answer my question which is very simple. We all know that the Housing Branch has many programmes on hand, but what I have asked is: When will the Administration really have a review of the relevant policies carried out? The Administration has never mentioned this point. My second point is about figures. When on earth will the Administration provide us with the figures required? These are the two major points which the Secretary has failed to respond to.

SECRETARY FOR HOUSING (in Cantonese): Mr President, the review report has already been submitted to the Housing Branch. As the relevant figures are still under study, I am unable to provide you today with the exact figures required. Generally speaking, there should not be much difference between the figures of the review and the target figures set by the Government.

DR LAW CHEUNG-KWOK (in Cantonese): Mr President, many people are of the opinion that the slump in the second-hand property market is mainly due to the fact that the Administration has gone too far in interferring with the property market. What factors will the Administration consider in deciding whether or not to relax regulation of the property market?

SECRETARY FOR HOUSING (in Cantonese): Mr President, it would seem that the second-hand property market has somewhat revived during the last month, as can seen from newspaper reports. The programmes introduced by the Government last year have now achieved the expected results. As to private property transactions, we can all see that the market has begun to revive and therefore I think there is no need at the moment to interfere with it or to provide it with any assistance.

MR JAMES TIEN (in Cantonese): Mr President, will the Administration supply this Council with information to indicate how many private building plans have been approved this year, that is, in 1995? I ask this question because, based on the number of building plans approved this year, we can forecast how many buildings will actually be completed in three years. We can thus tell if the number of buildings completed will greatly decrease, as pointed out by the Honourable Eric LI.

SECRETARY FOR HOUSING (in Cantonese): I am sorry, Mr President. I do not have such information off hand, and so I cannot answer this question.

PRESIDENT: Could that figure be supplied in writing subsequently, Secretary?

SECRETARY FOR HOUSING: Yes, Mr President. (Annex I)

MR LEE WING-TAT (in Cantonese): Mr President, everybody knows that the most important way to regulate or to stabilize property prices is to have a steady supply of a large number of private properties. However, there are three unfavourable factors which have worried me a great deal. First, according to the information provided by the Rating and Valuation Department, the production of private properties in 1993 and 1994 was lower than expected. Secondly, there have been fewer redevelopment sites in urban areas. Thirdly, the record vacancy rate of 4.7% means that about 50 000 private domestic flats are vacant. Will the Secretary for Housing ascertain whether these three unfavourable factors will in the long run cause considerable obstruction to the target of providing sufficient private domestic flats for the public? If so, what are the solutions?

SECRETARY FOR HOUSING (in Cantonese): Mr President, the Government has set up a Housing Project Action Team to look into the matter of land supply. As long as the number of flat units exceeds 500, the Team will try its best to help the responsible organization, be it the Housing Authority, the Housing Society or even a private organization, to solve the problem of land supply, or take whatever action to co-operate with the organization concerned. The Team is chaired by the Secretary for Housing. As regards the vacancy rate of 4.7% which means about 50 000 housing units are vacant, I think the vacancy rate has remained at more or less the same level recently. There is no indication that this year's figure is particularly high or particularly low. It has remained at this level during the past few years.

PRESIDENT: Mr LEE, not fully answered?

MR LEE WING-TAT (in Cantonese): I would like to clarify one point. The Secretary for Housing has mentioned that during the past few years, the vacancy rate has remained at 4.7%, which means some 50 000 housing units are vacant. Will the Secretary for Housing inform us of the private housing vacancy rates of the years from 1991 till now? As far as I can remember, the lowest rate is 3.9% and the highest, 4.7%.

SECRETARY FOR HOUSING (in Cantonese): Perhaps I will provide a written reply. (Annex II)

Broadcasting Bill

5.MR ANDREW CHENG asked (in Cantonese): Mr President, the Government indicated to this Council on 2 November 1995 that it would seek the views of interested parties and consult the Chinese side on the Broadcasting Bill (the Bill). In this connection, will the Government inform this Council:

  1. how it will go about seeking such views; whether it will conduct public consultations on major issues arising from the Bill, such as the restrictions on "cross media ownership" and the regulation of "interactive multimedia services", and
  2. what progress has been made to date in its consultation with the Chinese side on the Bill; and what are the specific details of the consultation?

SECRETARY FOR RECREATION AND CULTURE (in Cantonese): Mr President, as drafting of the Bill is still underway, we have not yet decided precisely how the consultation should be conducted, and neither have we initiated consultations with the Chinese side. However, I can say that it is our intention that all interested parties will have an opportunity to comment on all matters in the Bill, and that all comments received will be considered carefully before the Bill is finalized for approval by this Council.

MR ANDREW CHENG (in Cantonese): The Government told this Council in the last Session that it would submit the Bill for deliberation by this Council. We, however, find it very disappointing that the Government did not honour its undertaking. Now the Government is saying again that it would table the Bill at this Council in this Session. Yet, the basic details of the consultation exercise have not been decided while the Chinese side still needs to be consulted. We all know that if the Chinese side is to be consulted on bills which are closely related to the freedom of speech ......

PRESIDENT: Please come to the question, Mr CHENG.

MR ANDREW CHENG (in Cantonese): ...... there will certainly be many people who wish to know more about the Bill. However, the Government has not started consulting the Chinese side and its reply to this Council was extraordinarily brief. For this reason, I deliberately speak at greater length to show my dissatisfaction. May I ask the Government how it can convince the public that the Government would proceed with the drafting of the Broadcasting Bill in this Session? If the Government is not going to proceed with this task, it should say so honestly and should not deceive us.

SECRETARY FOR RECREATION AND CULTURE (in Cantonese): The Honourable Andrew CHENG was disappointed because my reply was too brief. In fact, I painstakingly did so with good intentions. It is because Members have been spending more and more time on the question session so I hope my words can be succinct and to the point by saying only what is needed and leaving out things which are deemed redundant.

I absolutely disagree with Mr CHENG's allegation that we have been deceiving the Legislative Council or members of the public. Mr CHENG can criticize me for being incompetent, brainless or even mediocre. I can stand the most scathing criticizms of all sorts but I have never deceived anybody. We are making an on-going effort in drafting the Bill and we hope we could submit the Bill as early as possible for Member's deliberation.

MRS ELIZABETH WONG: Mr President, I think the Secretary has given a perfect answer to justify negativity and also prolonged delay. I do not think any other civil servant can emulate his perfection. I have heard previously of baking a chestnut cake. I think it is a hard nut to crack. We are still cracking the chestnut.

Will the Secretary inform this Council of the approximate timetable when he is likely to submit his Bill to this Council?

SECRETARY FOR RECREATION AND CULTURE (in Cantonese): Mr President, I am grateful to the Honourable Mrs Elizabeth WONG for thinking so highly of me. I think not many officials here can give a reply which is commended by Members as perfect and I think I deserve it. I can assure Members that it is definitely not a chestnut cake that is being taken out from the oven because chestnut cake would always be the last thing I choose to eat. In response to the question raised by Mrs Elizabeth WONG, I can only recapitulate that at present, the drafting of the Bill is still underway and we hope we could submit the Bill for Members' deliberation as early as possible. Besides, I can only reiterate, as the Acting Secretary for Recreation and Culture said in the written reply to a question on 2 November 1995, that it has always been the plan of the Government to submit the Bill for Members' deliberation in this Session. However, as to the question of when exactly the Bill will be tabled, it will depend on the progress of the drafting work and the time required for consultation with interested parties.

WRITTEN ANSWERS TO QUESTIONS

New Posts in the Political Adviser's Office

6.MISS EMILY LAU asked (in Chinese): It is learnt that three new posts have been created in the Office of the Political Adviser. In this connection, with the Government inform this Council

  1. of the reasons for the creation of these new posts;
  2. of the salary scale and area of responsibilities of each of the posts; and
  3. from which departments the officials presently holding these posts were transferred and what posts did they hold in the departments concerned?

CHIEF SECRETARY: Mr President, the Political Adviser's Office has recently been reorganized, on a trial basis, to bring together those functions of the Hong Kong Government which derive directly from the United Kingdom sovereignty and which will cease in June 1997 when the office will be wound up. This has involved the transfer of certain responsibilities and loan of posts from other Secretariat Branches. The answers to the specific questions are as follows:

  1. No new posts have been created on the establishment of the Political Adviser's Office. However as a result of the reorganization, there are now three additional officers designated as Deputy Political Advisers. Two of these posts are on loan from other Secretariat Branches; the third is an officer filling an existing post which has been retitled;
  2. All these officers are filling existing AOSGC posts at the D2 level. The Deputy Political Adviser (Security) post deals with certain security issues related to the United Kingdom sovereignty. The Deputy Political Adviser (General) post is responsible for contributing to the China advice function and supporting the Political Adviser as a member of the Joint Liaison Group;
  3. The Deputy Political Adviser (Security) is filling the post of Principal Assistant Secretary (Security) D currently on loan from Security Branch. The Deputy Political Adviser (Personnel) is holding the post of Principal Assistant Secretary (Civil Service) Development on loan from Civil Service Branch. The third post, Deputy Political Adviser (General) is an existing AOSGC directorate post in the Political Adviser's Office which has been retitled.

Educational Needs of New Immigrant Children

7. MR EDWARD HO asked (in Chinese): Since the middle of this year, the number of Chinese immigrants arriving daily in the territory for permanent residence has increased from 105 to 150 and many of these immigrants are school-age children. In this connection, will the Government inform this Council:

  1. whether, in the light of the increasing number of children (aged six to 12) from mainland China settling in the territory, the Education Department (ED) has made any assessment and co-ordination of their educational needs at various levels of schooling in the next five to 10 years; if so, what are the details of the assessment and co-ordination plan; if not, why not; and
  2. whether the ED has set up any task force to provide assistance and counselling to such children and their parents to cope with the difficulties the children may encounter in their studies?

SECRETARY FOR EDUCATION AND MANPOWER: Mr President,

  1. To meet the demand for primary school places from an increasing number of Chinese immigrant children who are aged between six and 12 over the next few years, we are committed to building five additional primary schools for completion in 1997-98. In the interim, we are making use of the existing vacancies in primary and secondary schools resultant from an overall decline in our school population to accommodate these children. We shall conduct a review of the longer-term requirements for school places at different levels, including secondary schools, as well as the various support services in 1996.
  2. There is close co-ordination among various sections in the Education Department in the provision of services to immigrant children and their parents. These services include school placement, tailor-made induction programme, remedial teaching, and guidance and counselling service.

On guidance and counselling, student guidance officers/student guidance teachers are stationed in primary schools to assist in:

  1. promoting pupils' positive behaviour, strengthening their motivation towards learning and enhancing their self-esteem;
  2. training on study or social skills so as to enable the pupils to cope with their learning, adjustment or behavioural problems; and
  3. providing individual guidance to help them deal with more complicated adjustment, social or family problems.

Regarding parents, the Education Department has provided subvention to 14 non-government organizations in the 1995-96 school year to run short adaptation courses for adult immigrants. The course contents include the technique to help them cope with the difficulties their children encounter in studies.

The Home Affairs Department has been tasked to monitor and assess the services provided for new arrivals from China to ease the process of integration, to identify groups who are specially at risk, and to recommend the most suitable approach for responding to the practical problems as they emerge.

Reconstruction of Roads in the New Territories

8. MR CHOY KAN-PUI asked (in Chinese): At present, there are still a number of roads in the New Territories which were constructed by the Government many years ago and which have all the time been managed by the Government. These roads, which include Fan Kam Road, the Yuen Long Section of Lam Kam Road and Kam Tin Road, can no longer meet the current standards for highways nor can they cater for the needs of the rapid developments in the New Territories. In view of this, will the Government inform this Council:

  1. of the total number of such roads in the New Territories at present, together with their names and locations; and
  2. whether the Government has formulated a timetable for the reconstruction of these roads to meet the current road standards so as to ensure the safety of road users; if so, what are the respective dates for the commencement and completion of the reconstruction work; if not, why not?

SECRETARY FOR TRANSPORT: Mr President, the road network in the New Territories has developed over the past 50 years. At the time individual roads were constructed, they all fully met the then prevailing standards. Higher standards have evolved over the years resulting in better and more modern roads. However, this does not mean that the other roads are either unsafe or of an unacceptable standard.

It is fully recognized that with the pace of development in the New Territories, some existing roads may not be able to cope with increased levels of traffic. These roads need to be improved. The Lam Kam Road (Yuen Long Section) and Kam Tin Road fall into this category.

The improvements currently proposed cover:

  1. the widening of Kam Tin Road in two stages from the existing single carriageway to dual-two carriageway. The first stage from Au Tau to Kam Tin will start in early 1998 and is scheduled for completion in early 2000. The second stage from Kam Tin to Lam Kam Road will start in 2002 and is scheduled for completion in 2005; and
  2. the widening of Lam Kam Road from Kam Tin Road to Kadoorie Farm from the existing single carriageway to possible dual-two carriageway. This is scheduled to start in 2002 for completion in 2005.

A reconstruction and maintenance programme for Fan Kam Road, Kam Sheung Road, Yuen Long Section of Castle Peak Road and Route Twisk is also in hand and will be completed over the next five years. Improvement measures will include the provision of proper footpaths and drainage.

As regards minor roads, traffic management measures are implemented to maintain safe and efficient movement of traffic. For example, where necessary, speed limits are imposed or certain categories of vehicles are prohibited.

We shall continue to upgrade the road network to keep pace with traffic demand.

Servicing "999" Calls

9. MRS SELINA CHOW asked (in Chinese): It was reported that a member of the public recently had dialed "999" to report a bank robbery but only to receive the recorded reply "the line is busy". In view of this, will the Government inform this Council:

  1. of the average number of police communication personnel responsible for answering "999" calls and the average number of calls they have to handle per shift at present, and how do these figures compare with the corresponding figures in each of the past three years;
  2. of the total number of calls made to "999" to report crime which received the recorded reply "the line is busy" this year;
  3. of the average time currently taken for a call to "999" to be answered by the staff manning the number, and how does this figure compare with those of the past three years?

SECRETARY FOR SECURITY: Mr President, the answers to the three parts of the question are as follows:

  1. There are 18 Police Communications Officers and three Senior Police Communications Officers manning the "999" Consoles per shift in the three Police Regional Command and Control Centres in Hong Kong Island, Kowloon and New Territories. The number of staff deployed for such duties is the same for the past three years. In the first 10 months of this year, each shift handles an average of 445 calls. The average figures for 1992, 1993 and 1994 are 328, 338 and 401 respectively.
  2. The pre-recorded bilingual broadcast message was introduced in September 1994. Our computer system does not capture statistics on the number of calls answered by the message. However, the pre-recorded message invariably asks the caller not to hang up in order that the call could be dealt with as soon as possible.
  3. While we do not have statistics on the average time taken to answer a "999" call in the past three years, the findings of a recent snap-shot survey conducted by the police show that on an average a "999" call is answered within six seconds. It is possible that a caller may need to wait longer than six seconds to get through when a major incident takes place. However, this does not affect the response time of the police because such cases are often reported by more than one caller. For example, in the case referred to in the question, the police received two other reports of the same case at the time of the bank robbery. It should be noted that the first police officer arrived at the scene six minutes from the receipt of the calls.

Implementation of Matrimonial Causes (Amendment) Ordinance 1995

10. MRS MIRIAM LAU asked: The Matrimonial Causes (Amendment) Ordinance 1995 was passed by this Council on 17 May 1995 but it shall come into operation on a day to be appointed by the Secretary for Home Affairs by notice in the Gazette. Will the Government inform this Council of the reasons why, after a lapse of six months since its passage, the Ordinance has still not come into operation; and when it is expected that a notice will be published in the Gazette to bring the Ordinance into operation?

SECRETARY FOR HOME AFFAIRS: Mr President, I share the Honourable Member's wish for the Matrimonial Causes (Amendment) Ordinance (the Amendment Ordinance) to be brought into operation as soon as possible. However, before this can be done, it is necessary for the Matrimonial Causes Rules (the Rules) to be amended to bring court procedures in relation to matrimonial proceedings in line with its provisions. Amendments to the Rules are made by the Chief Justice. The Home Affairs Branch has been co-ordinating the preparation of the necessary amendments to the Rules. The relevant professional bodies are currently being consulted on an advanced draft. We expect to be able to finalize the amendments to the Rules and submit them to the Chief Justice for consideration within the next few weeks.

The Amendment Ordinance will be brought into force at the same time the amendments to the Rules to be made by the Chief Justice come into effect.

Misleading Advertisements

11. MR SIN CHUNG-KAI asked (in Chinese): As certain advertisements broadcast on television and radio, or carried in newspapers and magazines, contain incorrect or exaggerated information which mislead the consumers, will the Government inform this Council:

  1. which government department is responsible for dealing with complaints about advertisements containing incorrect information and how such complaints are handled;
  2. of the number of complaints about advertisements containing incorrect information received by the department concerned, as well as the number of companies which have been prosecuted as a result of such complaints in the past three years; and
  3. what regulatory measures have the Government put in place to ensure that advertisements released through the mass media contain no misleading or incorrect information?

SECRETARY FOR RECREATION AND CULTURE: Mr President, the Broadcasting Authority (BA) issues Codes of Practice in respect of advertising on radio and television. Broadcasters are required under their licence conditions to adhere to these Codes, and to exercise reasonable care and diligence to ensure that the factual claims made in advertisements are correct. Through its executive arm, the Television and Entertainment Licensing Authority (TELA), the BA monitors broadcasts to check for compliance and also acts on public complaints. The BA may warn broadcasters who contravene the Codes, or impose a financial penalty up to a maximum of $250,000. During the last three years, TELA received 110 complaints alleging incorrect information in advertisements broadcast on television and radio. After investigation, 80 of these complaints were found not to have contravened the Codes. Of the remainder, warnings were issued in 27 cases, and three cases have yet to be considered by the BA.

There is no overall control of advertising in the print media, although a variety of Ordinances governs specific types of advertisements. The Undesirable Medical Advertisements Ordinance (Cap. 231) regulates advertisements promoting medical treatments, and is administered by the Department of Health. That Department regularly screens newspapers and warns those who publish undesirable advertisements (or cause them to be published). Where warnings do not suffice, the cases are referred to the police. Over the past three years, 220 warnings have been issued, and six prosecutions taken out.

Under the Protection of Investors Ordinance (Cap. 335), the authorization of the Securities and Futures Commission ("SFC") is required for all advertisements which contain a public offer of securities or investment arrangements, unless otherwise exempted. The SFC authorization vets such advertisements prior to issue for, among other things, incorrect, exaggerated or misleading information. In addition, the SFC also monitors the local papers for unauthorized advertisements and acts on complaints. Over the past three years, it has acted on 15 complaints, mostly by requiring the offending advertisements to be amended or withdrawn. Eight prosecutions have been mounted in recent years.

The Consumer Council also assists consumers to obtain remedies when they complain of incorrect or exaggerated information in advertisements, although it has no powers of prosecution. If appropriate, the Council may refer the case to the Customs and Excise Department for further examination under the Trade Descriptions Ordinance (Cap. 362). Statistics on the number of complaints about advertisements in the print media received by the Consumer Council are not readily available as complaints are entered by product or service specific categories.

Safety Standards for Glassware Products

12. MR CHAN KAM-LAM asked (in Chinese): Will the Government inform this Council:

  1. of the number of accidents involving industrial and household glassware products and installations in the past three years; and
  2. whether it will consider introducing regulations to stipulate the safety standards for glassware products and to require manufacturers to specify on their products the types of glass used and the level of durability measured in an impact-test?

SECRETARY FOR TRADE AND INDUSTRY: Mr President,

  1. We do not have statistics on the number of accidents involving industrial and household glassware products and installations. Industrial accident statistics are analyzed by cause and by industry. There is no breakdown by either the material or the equipment involved in industrial accidents. The Hospital Authority compiles patient statistics according to international classification of diseases. It does not have separate figures on the number of accidents involving use or installation of glassware products.
  2. The safety of glassware products for private use or consumption is already covered by the Consumer Goods Safety Ordinance, which came into force in October this year. This Ordinance imposes a statutory duty on manufacturers, importers and suppliers of consumer goods (including glassware products) to ensure that the goods they supply in Hong Kong are safe. Section 4 of the Ordinance further requires that consumer goods (including glassware products) supplied in Hong Kong must comply with a general safety requirement which includes, inter alia, the adoption of reasonable safety standards published by a standards institute. Any supplier who fails to comply with the requirement under the Ordinance commits an offence. The Commissioner of Customs and Excise will monitor the situation and take enforcement action as appropriate.
    Accordingly, we do not see the need to introduce specific regulations to stipulate the safety standards for household glassware products and to require manufacturers to specify on their products the types of glass used and the level of durability measured in an impact test.

Relocation of Methadone Clinic to Tsui Ping Estate

13. MR FRED LI asked (in Chinese): The 10-year redevelopment programme for Kwun Tong Town Centre proposed by the Land Development Corporation includes the relocation of the methadone clinic at the Town Centre to Tsui Ping Estate nearby. As methadone clinics often bring nuisance to the community in which they are located, will the Government inform this Council:

  1. whether it will consult local community groups and residents in this regard; if so, what are the details; if not, why not;
  2. whether the Government will make alternative arrangements to set up the methadone clinic further away from Tsui Ping Estate in view of the worsening drug abuse problem in that Estate; and
  3. what long-term and interim measures the Government has adopted to tackle the drug abuse problem in the neighbourhood of Tsui Ping Estate?

SECRETARY FOR SECURITY: Mr President,

  1. The Kwun Tong Town Centre Redevelopment Scheme proposed by the Land Development Corporation (LDC) is still being considered by the Corporation and the Administration. If the Scheme is to be implemented, the Kwun Tong District Board, and other relevant local bodies, where appropriate, will be consulted in advance on any proposal to relocate the methadone clinic.
  2. No decision has been made on whether and where the methadone clinic in Kwun Tong should be relocated. The Government is open-minded about the location of methadone clinics. An important consideration is the accessibility of the clinic, as the objective of the methadone programme is to offer a readily accessible out-patient service for those drug abusers who seek treatment but, for various reasons, would not be able to take part in residential treatment programmes.
  3. The drug abuse problem in the neighbourhood of Tsui Ping Estate is being tackled at source by stepped-up law enforcement action, and preventive education and publicity.
    Police enforcement action against drug activities in Tsui Ping Estate has been stepped up. This can be seen from the number of arrests for serious narcotics offences in Tsui Ping Estate, which has increased from 46 in 1994 to 80 in the first nine months of 1995. At the street level, enhanced enforcement actions are taken on a daily basis against drug sellers and users. Information and intelligence on drug activities, with particular emphasis against drug sellers, are collected, collated and acted upon by the Kwun Tong District Special Duties Squad to target known drug sellers.
    The police also contributes to anti-drug education by organizing school visits and seminars with school headmasters and discipline masters, focussing on the prevention of drug abuse by students.
    Extra efforts have been put in preventive educational and publicity measures to arouse awareness among Kwun Tong residents on the drug problem. Emphasis has been laid on enhancing parents' understanding on the prevention and early detection of their children's involvement in drugs. In 1995-96, a total of seven programmes involving 10 000 participants have been/will be implemented by the social welfare service units in the district. Existing counselling services of family service centres and probation offices in the district have also been strengthened to help young people with drug problems and their families.
    The District Social Welfare Office (DSWO) in Kwun Tong has formed a Working Group on "District-wide publicity campaign in combating illicit use of drugs among young people in Kwun Tong District" in April*1995, to promote co-ordination and co-operation among government departments and local organizations to tackle the drug problem. A "Drug Ambassador Scheme" is now being launched by the Working Group, with the aim of publicizing widely anti-drug messages among young people through a signature campaign. So far over 7 000 participants from more than 30 local organizations have been enrolled. The Working Group also compiles leaflets on district beat-drug activities on a regular basis to encourage participation of local residents.
    In the longer term, the DSWO in Kwun Tong will continue to take active part in the Kwun Tong District Fight Crime Committee to plan and co-ordinate anti-drug strategies at the district level. Group work units in the district, particularly the Group Work Unit of the Kwun Tong Community Centre (which is located in Tsui Ping Estate) will organize regular activities to educate young people to stay away from drugs. Services from the "Against Substance Abuse Scheme" provided by the team of specially trained social workers newly set up by the Social Welfare Department would also be tapped whenever necessary.
    A paper on "Illicit use of drugs in Kwun Tong District" was discussed at the Kwun Tong District Fight Crime Committee meeting in May*1995 to co-ordinate district efforts in tackling the problem. Local non-government organizations will be encouraged to organize anti-drug activities through various channels such as the Kwun Tong District Committee on Family Life Education, the Kwun Tong District Group and Community Work Service Co-ordinating Committee. Social workers of the Society for the Aid and Rehabilitation of Drug Abusers working in the methadone clinic in the district will continue to provide casework services to drug abusers to facilitate their social rehabilitation.

Air Services to Taiwan

14. MR LAW CHEUNG-KWOK asked (in Chinese): Will the Government inform this Council:

  1. whether, in order to be eligible to apply for a licence to operate air services between Hong Kong and Taiwan, the China National Aviation Corporation (CNAC) has made a formal application to become an airline whose principal operation is based in the territory; if so, what factors the Government will take into consideration in determining whether a licence will be granted to CNAC to operate the route; if not, whether it will consider inviting CNAC to make such an application; and
  2. what share of the market does the Cathay Pacific Airways (CPA) have in providing air services between Hong Kong and Taiwan, and whether CPA has adopted any policy which is not in the interest of the consumers?

SECRETARY FOR ECONOMIC SERVICES: Mr President,

  1. The China National Aviation Corporation (Hong Kong) Limited (CNAC(HK)) submitted an application for an Air Operator's Certificate (AOC) to the Civil Aviation Department (CAD) on 29 March 1995. Securing an AOC is a necessary prerequisite to operate Hong Kong registered aircraft for the purpose of public transport. An AOC may be granted if the Governor is satisfied that the applicant is competent, having regard in particular to his previous conduct and experience, his equipment, organization, staffing, maintenance and other arrangements to secure the safe operation of aircraft of the types specified in the certificate. CNAC(HK) has not yet submitted any documents in support of its application. CAD will give due consideration to the application when such documents are received.
    An application for an AOC is the first of several steps which a company has to go through before it will be able to mount scheduled air services with Hong Kong registered aircraft. In addition, the company will also have to apply for registration of its aircraft, obtain a licence for a specific route from the Air Transport Licensing Authority and seek designation by the Government for the route concerned. It is not government policy to invite any particular airline to make an application for any route; the airline concerned would have to apply and fulfill all the necessary requirements before it will be permitted to operate.
  2. At present, scheduled air services between Hong Kong and Taiwan are operated between Hong Kong and two cities in Taiwan, namely, Taipei and Kaohsiung. On the Hong Kong - Taipei route, the Cathay Pacific Airway's (CPA's) market share was 51.1% in the 12 months up to August 1995. On the Hong Kong - Kaohsiung route, CPA's market share was 53.8% in the same period.
    On both of the routes between Hong Kong and Taiwan, there is a choice for consumers. On the Hong Kong * Taipei route (which constitutes 82% of the total traffic between Hong Kong and Taiwan), six other airlines, apart from CPA, operate on the route. They are British Asia Airways, China Airlines, Japan Asia Airways, Singapore Airlines, Garuda Indonesia Airways, and Thai Airways International. On the Hong Kong * Kaohsiung route where traffic is only about 18% of the total traffic between Hong Kong and Taiwan, China Airlines operate on the route in addition to CPA.

Application and Approval of Search Warrants

15. MR CHIM PUI-CHUNG asked (in Chinese): In regard to applications for search warrants by government departments, will the Government inform this Council:

  1. of the criteria on which the court's approval of an application for search warrant file by a government department is based and whether there is any system to keep this power in check;
  2. whether the court or the department which files the application will be held responsible in the event that the application is subsequently proved to be at fault or ultra vires;
  3. of the time normally taken for obtaining a search warrant; and
  4. if members of the public have objections to be contents of an application for search warrant, to which department should they go to in order to raise their objection prior to the grant of the search warrant?

CHIEF SECRETARY: Mr President,

  1. In granting applications for search warrants, the court acts in accordance with the provisions in the relevant legislation under which the applications are made. The magistrate responsible will make sufficient enquiry to satisfy himself that there is reasonable cause to suspect that the items in respect of which the warrant is sought are on the premises to be searched. Such enquiry could include questioning the police officer requesting the search warrant under oath or affirmation or requiring the information in support of the warrant to be more precise.
    The power to grant warrants is discretionary. Therefore, a magistrate is not required to accede to an application for a search warrant even where the statutory requirements have been met. This together with the fact that a magistrate must refuse to grant a warrant if he is not satisfied that there is reasonable cause to suspect that the items in respect of which the warrant is sought are on the premises to be searched, serves to keep searches by government departments in check.
  2. Whether the court or the department which filed the application would be held responsible in the event that the application is subsequently proved to be at fault or ultra vires depends upon the circumstances in which the search warrant was issued. In general terms, a court could only be held responsible where it was established that it was acting maliciously and without reasonable and probable cause; and a government department could only be held responsible where it was established that it was acting maliciously.
  3. A department can normally obtain a search warrant from the court on the same day it files an application.
  4. An application for a search warrant is made ex parte, that is, only the party making the application is present. To inform the owner of the premises to be searched of the application would defeat the purpose of the search.

Air-tickets for Civil Servants on Duty Visits

16. MR CHEUNG MAN-KWONG asked (in Chinese): With regard to the purchase of air-tickets by the Government for civil servants on overseas duty visits and training, will the Government inform this Council:

  1. of its policy on purchasing such air-tickets;
  2. whether agreements have been made with any airlines for the purchase of air-tickets; if so, what are the details and why such agreements have been made;
  3. of the expenditure involved in purchasing such air-tickets during the past two years, together with a breakdown of the number of civil servants involved and their destinations;
  4. whether the Government has information to show that the adoption of its present policy on the purchase of such air-tickets, as compared with purchases made through travel agents or by other means, will result in a higher expenditure of public funds; if so, what are the reasons for continuing with the present policy; and
  5. whether consideration has been given to reviewing the present policy on the purchase of such air-tickets; if so, what are the details; if not, whether the Government will consider adopting other arrangements to purchase such air-tickets, such as placing orders with the airline purchase such air-tickets, such as placing orders with the airline charging the lowest fares or introducing other forms of competition?

SECRETARY FOR THE CIVIL SERVICE: Mr President, the answers to the questions raised are:

  1. The Government has an agreement with the British Airways (BA) and Cathay Pacific Airways (CPA) under which air-tickets (from any airlines) for civil servants on overseas duty visits have to be purchased through Jardine Airways (BA's general agent) or CPA. Air-tickets for civil servants on overseas training are not covered by the agreement, and can be purchased through any travel agent which accepts direct payment by the Treasury.
  2. The passage agreement with BA and CPA basically covers the Government's duty and school passages, but the Government may also make use of the contract fares for other passages to and from the United Kingdom. The main features of the agreement are:

    1. BA and CPA provide air-tickets at reduced fares on the Hong Kong - United Kingdom direct route (the United Kingdom route); and
    2. air-tickets on non-United Kingdom routes (from any airlines) have to be purchased through Jardine Airways or CAP.
      The Government entered into an agreement with the two airlines because the service required by the Government was and remains mainly passages on the Hong Kong - United Kingdom direct route ─ the bulk of which relate to school passages. Until 1994 only BA and CPA provided direct-route service to the United Kingdom. With the exception of Virgin Atlantic Airways (VAA) which started operating on the Hong Kong - United Kingdom direct route in 1994, the other airlines do not provide direct-flight service on the this route and therefore are unable to participate. We are discussing with BA and CPA the possibility of including the service of VAA in the current agreement.
    3. The expenditure involved in purchasing air-tickets for civil servants' overseas duty visits and training in 1993-94 and 1994-95 is $85.4 million, involving a total of 5 956 return passages. We have not kept specific records on the destinations of these passages.
    4. On the whole, we are getting a reasonable deal out of the agreement with BA and CPA as the Government is able to benefit from the reduced fares on the Hong Kong - United Kingdom direct flights with guaranteed bookings in both peak and off-peak seasons. The current arrangement for the purchase of air-tickets for civil servants' overseas duty visits and training, even if considered on its own, does not incur a much higher public expenditure, since the costs of published-fare air-tickets are roughly the same irrespective of from which agent they are bought. We are using published fares because the lower-fare air-tickets available in the market are very often special or promotional-fare tickets with usage restrictions attached, which would frequently not meet the operational requirements of these duty visits.
    5. With a view to achieving further savings, we are discussing with BA and CPA the possibility of including the service of VAA in the current agreement. We are also reviewing the scope of our being able to make use of the cheaper air fares available in the market for civil servants' overseas duty visits and training.

Green Island Public Dump Scheme

17. MR AMBROSE LAU asked (in Chinese): Now that the Government is consulting the public on the feasibility of the Green Island Public Dump Scheme and that the removal of Hong Kong International Airport has been scheduled for 1998, will the Government inform this Council whether consideration will be given to transporting construction waste on Hong Kong Island by land or by sea to the waters off the Airport and Kowloon Bay for dumping as an interim measure, as such a move will prepare that area for the future reclamation work on the one hand and allow more time for the public to study the policies relating to the Green Island reclamation on the other?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, the Territory Development Department has commissioned a feasibility study on the proposed future development of Kowloon Bay and the current Hong Kong International Airport. The study will examine, among other things, the possible sources of fill material, including construction waste, suitable for the proposed reclamation at Kowloon Bay. Findings of the study will help the Government in considering the viability of public dumping at Kowloon Bay and/ or the Airport. The study is scheduled to be completed in mid-1997. No decision will be made before the Government has examined the findings thoroughly.

Oxygen Content in Air

18. DR SAMUEL WONG asked: The proportion of oxygen in the air in some urban districts is sometimes found to be as low as 10%, although the normal oxygen content in the air is about 20%. In such circumstances, people will have to inhale more air, and hence more pollutants, than normal in order to get the oxygen required. In this connection, will the Government inform this Council whether:

  1. the Government will consider releasing the multiplication factor of pollution intake in each district due to lower oxygen content along with the pollution indices now published daily by the Environmental Protection Department; and
  2. if the answer to (a) above is in the negative, whether the Government will consider taking such factor into account in determining the pollution indices?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, the Air Pollution Index is designed to reflect the quality of outdoor air, of which the oxygen content is constantly at the normal level of 20%. In the outdoor environment, the carbon dioxide level in Hong Kong is well below 0.5% and variations around this level of concentration will not affect the oxygen content of the air. The issue of low oxygen in outdoor air is only relevant to locations at altitudes above 10 000 feet; but this is not relevant to Hong Kong. It is therefore not necessary for the Air Pollution Index to take into account the oxygen content. Hence, the answers to both (a) and (b) are in the negative.

Monitoring of H Share Companies

19. DR HUANG CHEN-YA asked (in Chinese): Will the Government inform this Council whether:

  1. the Securities and Futures Commission (SFC) will make a comparison between the profits predicted in the prospectuses of H share companies and the performance of these companies as published after the first year;
  2. the SFC has carried out investigations into companies which have recorded marked discrepancies between the predicted and actual profits; if so, what are the findings; and
  3. there are statutory provisions requiring merchant banks to be responsible for the accuracy of the information contained in prospectuses; if so, what are the liabilities of the merchant banks in the event that the particulars in the prospectuses are found to be incorrect, and what penalties will be imposed on them; if not, whether the Government will require merchant banks to assume responsibility, so as to reduce the chance of investors being misled?

SECRETARY FOR FINANCIAL SERVICES: Mr President,

(a) and (b)

    The Stock Exchange of Hong Kong (SEHK) is the frontline regulator responsible for the supervision of listed companies and the administration of all related matters. The SFC oversees the SEHK but is not directly involved in such matters.

    The SEHK reviews the performance of all newly listed companies, including H share companies, for the first accounting year after their listings, and compares that with the projected profits stated in the respective prospectus of the companies.

    All listed companies are required to sign a Listing Agreement and to abide by the SEHK Listing Rules. Under the Listing Agreement, a listed company is obliged to notify shareholders promptly of the occurrence of any event which could cause the forecast assumptions to be materially different from those stated in the prospectus and to indicate the likely impact of such event on the projected profits. The Listing Agreement also requires a company in such circumstances to include an explanation for such material difference in its directors' report and accounts.

    The SEHK monitors compliance with the Listing Rules and carries out inquiries where necessary. During the past three years, the SEHK has found two cases (one of which involves an H share company) where the actual results published in the directors* report and accounts differed materially from the projected profits stated in the relevant prospectus. In both cases, the company involved has issued a clarification statement to the public in accordance with the relevant Listing Rules.

  1. There are no statutory provisions which expressly impose special responsibilities on merchant banks for the accuracy of prospectuses. However, there are statutory provisions under which merchant banks could be exposed to criminal and civil liabilities in respect of untrue statements in prospectuses. Such liability is imposed on every person who has authorized the issue of the prospectus containing untrue statements. Coming within the wide class of persons who authorize the issue of the prospectus can be brokers, merchant banks, solicitors and others associated with the prospectus.
    Civil liability is created by section 40 of the Companies Ordinance (the Ordinance) in respect of Hong Kong companies, and section 342E of the Ordinance in respect of companies incorporated outside Hong Kong. The liability is to persons who subscribe for securities on the faith of a prospectus and sustain loss or damage by reason of any untrue statement contained therein.

    Criminal liability is created by section 40A of the Ordinance in respect of Hong Kong companies and section 342F of the Ordinance in respect of companies incorporated outside Hong Kong. If a prospectus contains a false statement, any person who authorized its issue will be guilty of an offence unless he can establish certain specific defences.

    The penalty for breaching section 40A or section 342F of the Ordinance is a fine of $500,000 or imprisonment for three years on indictment, and a fine of $100,000 and imprisonment of 12 months on summary charge.

    If a merchant bank acts as a sponsor in relation to a listing, it also has to comply with the Model Code for Sponsors of the Listing Rules. The Code requires that the sponsor should be closely involved in the preparation of the listing document and in ensuring that all material statements therein have been verified and that it complies with the Listing Rules and all relevant legislation. Failure by a sponsor to meet its obligations under the Listing Rules without reasonable excuse may render that person unacceptable to the SEHK for performing the role of a sponsor in the future.

ADDRESS

Ocean Park Corporation Annual Report 1994-95

MR RONALD ARCULLI

: Mr President, tabled before the Council today is the 1994-95 annual report of the Ocean Park Corporation.

In the financial year that ended on 30 June 1995, the Ocean Park enjoyed another year of record attendance with 3.3 million visitors to the Park, an increase of 5% on last year's record of 3.2 million.

The Ocean Park's revenue grew by 6% to HK$324 million. Operating income was HK$319 million. The net operating surplus for the financial year was HK$23 million, which compared with a net operating surplus of HK$53 million in the 1993-1994 financial year.

These results are most satisfactory given the difficulties encountered during the year. The higher attendance figure was pleasing given that Hong Kong experienced a series of severe tropical storms during the year which necessitated partial closure of the Park.

The number of overseas visitors to the Park fell by 9% mainly due to the drop in the number of tourists from China and Taiwan. Fortunately, more local residents visited the Park. The record number of visitors was largely due to improvements in the Ocean Park and new attractions which opened during the year.

Three new attractions costing a total of HK$58 million were opened in time for the Christmas-New Year holidays. On the Headland, we opened the 100-foot tall Ferris Wheel which provides spectacular views 400 feet above the South China Sea. We also opened the Eagle Ride which proved extremely popular. However, it is currently closed while modifications are made and tested. We plan to have the ride fully operational early next year. On the Lowland, we opened the Dinosaur Discovery Trail which, with its lifelike models and animatronic robots, proved an instant success with the public.

The largest influx of visitors came during the spring in response to the re-opening of the Atoll Reef. The Atoll Reef has traditionally been the Park's most popular attraction. The Reef has undergone a HK$65 million refurbishment and is now the largest reef aquarium in the world.

During its first full year of operation, the Ocean Park Conservation Foundation announced a five-year plan involving 16 whale and dolphin projects which include identification of conservation problems, development and executive of action plans, and long-term research to direct and support future marine mammal conservation efforts in the region.

The Foundation also convened the first meeting of the Asian River Dolphin Committee. Scientists from nine countries, including China, and representatives of the IUCN Cetaccan Specialist Group and The Whale and Dolphin Conservation Society met to discuss strategies for protecting threatened marine mammals.

The Ocean Park has an on-going commitment to improve access to the Park's facilities for Hong Kong's disabled residents. This year, new facilities for the disabled included contour models for mechanical rides, tactile maps and guide books for the visually impaired, improved access for wheelchair-bound visitors and the installation of a special gondola for disabled visitors on the new Ferris Wheel.

While the recent difficulties experienced at the Park fall outside this financial year, it would be remiss of me not to congratulate the management and staff on the way they handled the consequences of the tragic Aberdeen landslide.

Through their work, the comfort and safety of both visitors and of the Park's marine mammals, fish and animals were assured, and the Park was able to return to normal operations in a speedy manner. Above all, we owe special thanks also to the Government Flying Service, the Fire Services Department and the Electrical and Mechanical Services Department.

Looking to the future, our long-term development plan is to continue to expand and to better serve the needs of all age groups and interests within the community. In the next year, we expect to have further improvements and add new attractions including the opening of a Mine Train roller coaster and a high-tech simulator ride.

After a year that was both rewarding and eventful, the Ocean Park will continue to work to fulfill its mission to provide a balanced mix of recreation, education and conservation. I believe the Ocean Park is well set to achieve even higher levels of popularity and success.

Thank you, Mr President.

MOTIONS

EMPLOYEES' COMPENSATION ORDINANCE

THE SECRETARY FOR EDUCATION AND MANPOWER to move the following motion:

    "That, with effect from 1 January 1996, the Employees' Compensation Ordinance be amended as follows -
  1. in section 6 -
    1. in subsection (1)(a), (b) and (c), by repealing "$15,000" and substituting "$18,000";
    2. in subsection (2), by repealing "$219,000" and substituting "$262,000";
    3. in subsection (5), by repealing "$12,000" and substituting "$14,000";
  2. in section 7 -
    1. in subsection (1)(a), (b) and (c), by repealing "$15,000" and substituting "$18,000";
    2. in subsection (2), by repealing "$248,000" and substituting "$297,000";
  3. in section 8(1)(a) and (b), by repealing "$297,000" and substituting "$356,000";
  4. in section 11(5), by repealing "2,250" where it twice appears and substituting "2,450";
  5. in section 16A(10) -
    1. in paragraph (a), by repealing "$350" and substituting "$420";
    2. in paragraph (b), by repealing "$700" and substituting "$840";
  6. in section 17A(1) -
    1. in paragraph (a), by repealing "$350" and substituting "$420";
    2. in paragraph (b), by repealing "$700" and substituting "$840";
  7. in section 36C, by repealing "$24,000" and substituting "$28,000";
  8. in section 36J, by repealing "$74,000" and substituting "$86,000";
    1. in paragraphs 1(b), 2(b) and 3 of the Third Schedule, by repealing "$120" and substituting "$160"."

He said (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

The purpose of this resolution is to revise the levels of compensation and certain compensation-related items under the Employees' Compensation Ordinance. The Ordinance provides for payment of compensation by employers to employees who are injured or killed as a result of employment-related accidents. Our policy since 1978 has been to review the levels of compensation every two years to take account of wage movements, inflation and other changes. The existing levels of compensation have been in force since 1 January 1994 and are now due for revision. We propose that the revised rates should take effect as from 1 January 1996.

We propose to increase the ceiling for monthly earnings from $15,000 to $18,000. This figure is the basis on which the maximum amounts of compensation for permanent total incapacity and for death are calculated under the Ordinance. We also propose to increase the minimum levels of compensation for death from $219,000 to $262,000, and for permanent total incapacity from $248,000 to $297,000. In addition, we propose that the maximum amount of compensation for the costs of care required by another person be revised from $297,000 to $356,000. For late payment of compensation, we propose to increase the minimum amount of surcharge imposed upon expiry of the payment period from $350 to $420 and the minimum additional surcharge imposed three months after expiry of payment period from $700 to $840. Each of these six proposed revisions represents an increase of about 19.7% over the existing levels, which is in line with the increase in nominal wages during the past two years.

The ceilings on three other forms of compensation are to be adjusted to take account of inflation since their last revision in 1994. The proposed changes include increasing the maximum amount for burial expenses from $12,000 to $14,000, and increasing the maximum payments to be made by an employer towards the costs of supplying and fitting a prosthesis or a surgical appliance from $24,000 and $74,000 respectively to $28,000 and $86,000 respectively.

We also propose to raise the maximum daily rate of reimbursement of medical expenses from $120 to $160 to take account of the increase in fees charges by public hospitals and clinics since 1994.

Finally, we propose to revise the amount that is deemed to be the minimum earnings per month for the purpose of calculating compensation from $2,250 to $2,450. This proposed increase serves to keep the deemed minimum earnings of an injured employee broadly in line with the existing rate of payment to a singleton under the Comprehensive Social Security Assistance Scheme.

These proposals have been endorsed by the Labour Advisory Board and I recommend them to this Council for approval.

Mr President, I beg to move.

Question on the motion proposed.

MR LAU CHIN-SHEK (in Cantonese): Mr President, I certainly support today's motion which seeks to increase the rate of compensation for workers who were injured or even killed in the course of their work. However, I would also like to take this opportunity to state again what I think are the shortcomings of the present Employees' Compensation Ordinance, hoping that the Government will review the whole system of workers' compensation as soon as possible.

The legislation currently in force has stipulated various ceilings for calculating the rate of compensation for workers who have permanently lost the ability to work in the course of their work and has made it impossible for workers to obtain the compensation that they deserve. First, concerning the calculation of the monthly wage ceiling. Although today's motion seeks to increase the monthly wage ceiling from $15,000 to $18,000, that is still an unreasonable restriction, especially in the construction sector in which workers suffer serious injuries. For the many steel fixers, scaffold erectors and the majority of other professionals who may be earning a monthly wage exceeding $18,000, the present legislation has undoubtedly deprived them of the compensation that they deserve. Therefore the Government should consider abolishing the monthly wage ceiling. In fact, the present monthly wage ceiling for the calculation of severance pay and long service payment has already been increased to $22,500, but that for the calculation of workers' compensation is only to be increased to $18,000. This is obviously an unfair treatment to workers claiming workers' compensation.

Second, concerning the upper limit of the amount of compensation. According to the Employees' Compensation Ordinance, the maximum amount of compensation which workers can claim of the basis of injury or death sustained in the course of work is equivalent to seven years or eight years of their total income respectively. These ceilings, which have been set without and objective criteria, are particularly unfair to young workers seeking workers' compensation. For instance, a 17-year-old summer job worker was killed in an accident involving a hoist in North Point in June 1993. According to the law, he could only obtain compensation equivalent to eight years of his total wage and deductions had to be made according to the family's reliance on him. As a result, this worker's family could only obtain compensation amounting to $100,000 plus. Do you think that is fair? Human life is invaluable and the law which has imposed various restrictions on workers' compensation should absolutely be reviewed and improved. The Government may think that workers claiming workers' compensation can try to obtain more by suing their employers for negligence through civil proceedings. However, legal proceedings not only involve many problems of evidence, they are also very time-consuming; and a law suit will normally drag on for three to five years. That is undoubtedly unfair to the injured workers and their families. Therefore, I think a comprehensive review on the Employees' Compensation Ordinance should be conducted without delay so as to strengthen the protection given to workers claiming workers' compensation. Of course, what is more important is to improve industrial safety in Hong Kong so as to prevent the occurrence of accidents.

Mr President, with these remarks, I hope the Secretary for Education and Manpower can clearly respond to my demands in his concluding speech later on. Thank you.

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, I would like to thank the Honourable LAU Chin-shek for his speech as well as his support for this motion. I have listened very carefully to the views expressed by Mr LAU on some items. The Government will consider these views in detail in the next review. There is no doubt that we will fully consider the views of both the employers and employees with regard to this Ordinance in every review.

Thank you, Mr President.

Question on the motion put and agreed to.

PNEUMOCONIOSIS (COMPENSATION) ORDINANCE

THE SECRETARY FOR EDUCATION AND MANPOWER to move the following motion:

    "That, with effect from 1 January 1996, the Pneumoconiosis (Compensation) Ordinance be amended as follows -
  1. in the First Schedule -
    1. in paragraph 1 of Part II, by repealing "$2,100" and substituting "$2,570";
    2. in Part IV, by repealing "$3,500" and substituting "$4,050";
    3. in Part VI, by repealing "$12,000" and substituting "$14,000";
  2. in the Second Schedule, in paragraphs 1(b), 2(b) and 3 of Part I, by repealing "$120" and substituting $160".

He said (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

The purpose of this resolution is to revise the levels of compensation and certain compensation-related items under the Pneumoconiosis (Compensation) Ordinance. The Ordinance provides for payment of compensation for persons who were diagnosed after 1 January 1981 to be suffering from pneumoconiosis. We propose that the revised rates should take effect as from 1 January 1996.

We propose to raise the ceilings in respect of two items of compensation under the Ordinance to take account of inflation and wage movements since July 1993. First, we propose to increase the amount for calculating the monthly compensation for total incapacity, from $2,100 to $2,570. In this respect, it should be noted that under the Pneumoconiosis (Compensation) (Amendment) Bill which was introduced into this Council on 6 December 1995 (that is last Wednesday), the amount of $2,100 was proposed to be made a separate compensation item for pain, suffering and loss of amenities which would be paid to all eligible pneumoconiotics regardless of their degree of incapacity. Therefore, if this proposed revision is approved, we will move a Committee Stage Amendment to the Bill to revise the amount to $2,570. Secondly, we prepare to increase the amount of compensation for care and attention from $3,500 to $4,050.

Separately, we also propose to revise the rates of funeral expenses and medical expenses payable under the Ordinance which have always been identical to those specified in the Employees' Compensation Ordinance. As the rates of such expenses under the Employees' Compensation Ordinance have just been raised by a resolution of this Council, I propose that the levels of these two items be similarly revised.

The proposed have been endorsed by the Labour Advisory board and I recommend them to this Council for approval.

Mr President, I beg to move.

Question on the motion proposed, put and agreed to.

STAMP DUTY ORDINANCE

THE SECRETARY FOR THE TREASURY to move the following motion:

    "That section 29I(1) of the Stamp Duty Ordinance be amended by repealing "31 December 1995" and substituting "31 December 1997"."

He said (in Cantonese): Mr President, I move the resolution standing in my name on the Order Paper.

I would like to first outline the background. In January 1992, Members approved amendments to the Stamp Duty Ordinance (Cap. 117). Among other things, these amendments required stamp duty to be paid on all agreements for sale of residential property. By contrast, stamp duty was previously only payable on the assignment of the property.

This measure was one of a series of actions to curb speculation in residential property. It is a disincentive to those who speculate on property in the period between the conclusion of a sale agreement and the assignment. Apart from the additional stamp duty a speculator has to pay for each sale before assignment, the speculator also has a potential profits tax liability. The information on sale agreements provided to the Commissioner of Inland Revenue under the measure enables him to identify property transactions which may be liable to profits tax. This ensures that the speculators pay a fair share of profits tax. The cost of speculation has therefore been significantly increased. Genuine home-buyers are not affected by this measure except insofar as they have to pay stamp duty slightly earlier.

Under the terms of the original amendments, the measure would have expired at midnight on 31 December 1993. The intention was to allow both the administration and Members the opportunity to examine all relevant factors before deciding whether the measure should be extended. On 15 December 1993, Members approved a resolution to extended the measure for two years until 31 December 1995.

The residential property market has gradually softened. The problem of speculation has now been largely contained. This is the combined effect of measures proposed by the Inter-departmental Task Force on Land Supply and Property Prices, mortgage lending policy of banks, changes in interest rates, as well as the increased cost of speculation as a result of the stamp duty measure. It is therefore important that the stamp duty measure be extended. Otherwise, it would send a wrong signal to the market that the Government no longer wished to curb speculation in residential property. There would also be a significant risk that speculation may be rekindled to the detriment of genuine home-buyers.

The motion before Members today seeks the extension of the measure by a further period of two years beyond 31 December 1995. I am grateful that the Legislative Council Subcommittee formed to study the motion supports the extension of the measure in principle though I understand that there are different views in respect of the period of extension, that is whether the measure should be extended for one year or two years.

It is clear that the measure is effective in containing speculation. It does not affect genuine home-buyers. It has been in place for nearly four years and is well established and accepted by the public. I therefore do not see any reason why we should deviate from our previous practice of extending the measure for two years which may otherwise give a wrong signal to the market in respect of this Council's determination in containing speculation. In fact, we have also informed the Subcommittee that it is our plan to seek the views of Members later on in this session with a view to introducing an amendment to the Stamp Duty Ordinance to make the measure permanent. This will eliminate unnecessary speculation which may otherwise occur each time the expiry date of the measure approaches. The proposed two-year extension would allow Members sufficient time to study the permanent arrangement proposal. However, if the measure were to be extended for one year only and the amendment to the Stamp Duty Ordinance to make the measure permanent could not be processed in time, we might have to seek an extension again before the end of next year, thereby adding an unnecessary burden to the heavy agenda of this Council. I therefore strongly recommend to Members that the two-year extension should be supported.

Finally, I am also grateful to the Members of the Subcommittee for their views on how we should revise the stamp duty system in order to alleviate the financial burden of genuine home-buyers and to safeguard against abuse. I can assure Members that we will examine these views carefully before we submit the permanent arrangement proposal to this Council.

Mr President, I beg to move.

Question on the motion proposed.

PRESIDENT: Mr Ronald ARCULLI has given notice to move an amendment to the motion. His amendment has been printed on the Order Paper and circularized to Members. I propose to call on him to speak and to move his amendment now so that Members may debate the motion and the amendment together.

MR RONALD ARCULLI's amendment to the SECRETARY FOR THE TREASURY's motion:

    "To delete "31 December 1997" and to substitute "31 December 1996"."

MR RONALD ARCULLI:Mr President, I move that the Secretary for the Treasury's motion be amended as set out under my name in the Order Paper. A Subcommittee of 12 Members was formed on 20 October 1995 to study the resolution. I was elected Chairman of the Subcommittee. The Subcommittee held two meetings with the Administration, and I shall highlight two issues which were of concern to the Subcommittee.

The first concern was about the effectiveness of the stamp duty measure and its continued usefulness. While some Members of the Subcommittee agreed with the Administration that the measure could help stabilize the residential price, other Members were not as certain and pointed out that the price of other properties had also been stabilized even though they were not the subject of the same measure. Some Members also cast doubts on the continued usefulness of this measure in the light of the already softened property market and the need to stimulate the local economy.

The second concern was whether the ultimate objective of the measure was to raise revenue or to curb speculation on the residential property market. The Administration told the Subcommittee that the measure had been introduced with the principal aim of helping to curb speculation, although it had also achieved two other equitable results, which were the stamp duty payable on the sale and purchase agreement and that the Commissioner of Inland Revenue could more readily identify property transactions liable to profits tax.

The Administration acknowledged that at the time of introducing the measure, anti-speculation had been the prime factor, but in seeking its extension in the present exercise both factors were important and it was not possible to say which had a greater weight. On this particular point, my own view is that the Administration has in fact changed the stamp duty system, which has since the very beginning charged stamp duty on assignments of residential property. I cannot accept such change for the reasons of raising revenue.

The majority view of the Subcommittee was to support the Administration in seeking an extension of time on the stamp duty measure in principal, yet Members indicated they would have to make an assessment about the impact of the stamp duty measure on the local economic climate before they could decide whether the extension should be for one year, to cover until 31 December 1996, or two years until 31 December 1997.

On 6 December 1995, Mr President, I submitted an amendment to the Administration's resolution, the effect of which is to extend the operation of the relevant section to 31 December 1996 rather than 31 December 1997. I shall set out my reasons for moving such an amendment. Property speculation in the current economic climate is virtually non-existent. Indeed, it can be said that the stamp duty and other measures have achieved their objective some time ago. It must be clear to all of us that steps need to be taken to stimulate the economy and one such step would be the removal of the stamp duty measure. At the very least, the situation should be reviewed after a shorter interval than that proposed by the Administration.

It has often been said that the Hang Seng Index and the property market act as a barometer of our confidence in Hong Kong, and we know that both are substantially below their peaks. Therefore, it cannot be objectionable to extend the stamp duty measure for one year only. I doubt very much whether the Administration will find it necessary to extend its operation for another year, but if it is, the Administration will of course be at liberty to table another resolution at the appropriate time. For now, however, I urge Members to support my amendment so that the existing measure will only be extended until 31 December 1996.

In conclusion, Mr President, I urge Members to give serious consideration to the Administration's stated desire to continue receiving the extra revenue from this so-called anti-speculation measure. The Administration does not need this Council's help to raise surplus revenue. Ultimately, the cost of any extra stamp duty will find its way into the pockets of end-users who will pay for it.

When the Secretary for the Treasury, Mr President, mentioned the two-year extension, the thought just dawned on me as to how many of us will be here in two years' time, so I would urge Members to support my motion so that the control of this measure will remain with Members of this Council.

Mr President, with these remarks, I move that the Secretary for the Treasury's motion be amended as set out in the Order Paper.

Question on the amendment proposed.

MR LEE WING-TAT (in Cantonese): Mr President, the Democratic Party believes that collecting stamp duty on sale and purchase agreements of residential property is an effective measure to curb speculation. That is because suppose two or more sale and purchase agreements have been entered into before the actual assignment of a residential property, stamp duty will be payable for each and every agreement. This measure will increase the costs of speculators without affecting the real users.

At present, property prices have fallen by about 30% compared with those in April 1994 and October 1995, but they are still not affordable by the general public. According to information contained in the Government's written reply given to me last week, in 1985, an ordinary Hong Kong citizen could buy a flat of 500 sq ft in the urban area with only an amount equivalent to 120 times the median monthly wage. Now in 1995, however, the same worker will have to pay an amount equivalent to 190 times the median monthly wage to buy the same flat. Therefore, Mr President, although property prices have apparently fallen, it is only a slight fall from a very high peak and they are still not affordable by the general public, especially the grassroots. In October 1995, about 10% of all property assignments were still short-term assignments. This percentage is only slightly lower than that of what we call the peak which is 22%. Therefore, speculation has not completely disappeared, it has only dampened slightly. Short-term assignments amounting to 22% is certainly an indicator of a lot of speculation at the time, but 10% is still a significant figure.

If anti-speculation measures are immediately relaxed just when there is a fall in property prices, suppressed speculative activities will easily become active again and the ultimate victims will be the real users. Moreover, now that property prices have only fallen slightly, property developers are already feeling anxious and, with the help of our Financial Secretary, they have spread the news that property prices have hit the bottom and promoted the opinion that they will rise again very soon. Many associations of property developers have continuously lobbied the Government to relax the mortgage restrictions. Therefore, now that property prices have fallen, we have to take steps to stabilize the situation. If not, there will be an upsurge of property prices once the anti-speculation measures are relaxed.

If we extend measure to collect stamp duty on sale and purchase agreements of residential property for only a year, then a year later, before the falling trend of property prices has stabilized, speculators will have the chance to enter the market and there will be a revival of speculation. In addition, there will still be a shortage of private housing units in the next two years and less land will be available for urban redevelopment. Relaxing the anti-speculation measure in the face of reduced supply will only lead to an upsurge in property prices.

Therefore, Mr President, we do not agree with the Honourable Ronald ARCULLI's amendment and we will support the Government's motion. Thank you, Mr President.

MR CHAN KAM-LAM (in Cantonese): Mr President, up till now, the Stamp Duty Ordinance has really been effective in curbing property speculation and, therefore, the Democratic Alliance for the Betterment of Hong Kong supports the Secretary for the Treasury's motion to extend the measure to 31 December 1997. Besides, we would also urge the Government to review the present system of stamp duty as soon as possible so that, with the extra revenue obtained under the present system, tax concessions can be given to the real users in the community and the public can be encouraged to own their homes. Thank you, Mr President.

MR EDWARD HO (in Cantonese): Mr President, I remember that in the year in which the stamp duty measure was passed into law, I was Chairman of the Select Committee concerned. At that time, the Government made it clear that the measure was intended to curb property speculation. However, it seems that it has now become one of the Government's ways to grab revenue. Why do I say that?

The Honourable LEE Wing-tat talked about the question of property prices. The present level of property prices is certainly higher than that of 1985 and it is very much higher than that of 1967. There is no need for us to argue what is the level which we would consider it wrong to allow property prices to reach. However, we should be clear that it would not be possible to speculate on new flats at all. That is because with the implementation of the new measure, a flat cannot be sold earlier than nine months before the occupation permit is due to be issued and, after purchase, it cannot be assigned until the occupation permit has been obtained. Therefore, it would not be possible to speculate on new flats. Now, the subject for discussion is the speculation of old domestic units. Would it be possible to speculate on old domestic units? What does "speculation" mean? Speculation means trying to make a profit by means of assignment with very little money, that is, before all the money and costs have been paid. However, to purchase an old domestic unit, the price has to be paid in full, which means it would not be possible to speculate and we also know clearly that there are no speculative activities on property in the market. If we support the Government's motion to extend the measure for two years, we would be supporting the Government to grab revenue by using this method. It is not a question of curbing speculation. Thank you, Mr President.

MR JAMES TO (in Cantonese): Mr President, I would like to briefly respond to the Honourable Edward HO's viewpoints. In fact, I agree that it would not be possible to speculate on new flats. If there are restrictions forbidding any assignment of uncompleted flats before the occupation permit is issued, the question of how many times a new flat can be assigned between the time that a purchase agreement has been signed and the final stage when the assignment is entered into simply does not exit. Here the question is: Would it be possible to speculate on old domestic units.

When purchasing an old domestic unit, one does not necessarily have to pay the price in full because theoretically, the deposit can be set, for instance, at 10% or 20% of the price and then the agreement can be signed. If no stamp duty is payable at this stage, the purchaser and the vendor can decide on a transaction date in the more distant future. Experience shows that speculation does occur in this interim period and a unit can be assigned several times before occupation or before the assignment is entered into.

This measure will not affect the real users adversely. I believe we will agree that this is true if we really want to help the real users, no matter to which political party we belong; unless my honourable colleagues can provide any evidence that this measure will affect the real users adversely, then that will be a different matter. In fact, whether tax concessions and deductions of mortgage interests payable should be allowed and whether the amount and percentage of mortgage loan should be increased will be practical and useful measures for us to discuss now. I believe this measure will not be used to grab revenue, but even if it will, it will only be used to grab revenue from the property speculators and potential speculators, not from the users. Actually, even if this measure does not exist, stamp duty is payable anyway at the final stage when the assignment is entered into.

MRS SELINA CHOW (in Cantonese): Mr President, earlier on, I heard the Honourable James TO mention "theoretically" and, very often, we hear colleagues from the Democratic Party say "theoretically"; I think that is not the way we should consider problems.

In fact, it is not easy to differentiate clearly who are the buyers and who are the users. We have to consider clearly not only the effect of a measure on the buyers, the users or the speculators, but also the effect on the property market as a whole. Earlier on, we heard the Honourable LEE Wing-tat's speech and there is nothing much to it. Basically, he thinks that the property prices at present are not low enough; they should fall even lower and it would be best if they were reduced by half or even more. He only cares for those who want to buy their own flat, but neglects those who have already done so and have lost a fortune because they may have used up all their assets to pay for the deposit.

I believe we are not relaxing the measure. The question is: the Government said that this measure was introduced because there was a problem and that this was a temporary measure to cool off the over-heated property market. If it is temporary, then it should not be extended arbitrarily for two years, for two more years and yet two more years so that it would become a permanent measure to intervene in the market until the price reaches a level which is considered to be acceptable by some. This is not the way in which this measure should work. I am only hoping that we can understand that we are actually intervening in the market. Do we want to adopt this approach as a long-term policy? Alternatively, we can continue to give the market the message that this is actually a temporary measure: when there is a serious problem, certain measures have to be adopted; when the problem is less serious, we do not wish to intervene.

Thank you, Mr President.

MR ALBERT HO (in Cantonese): Mr President, I would like to make only a very short response. First, what is "property speculation"? To put it very simply, it means purchasing a property with a very small outlay and trying to assign it within a certain period of time after a wait-and-see period (there is already an intention of assignment at the time of purchase).

What is the method commonly used? Earlier on, the Honourable James TO has said that after the purchasers have paid the deposit, they would speculate on property by means of assignment. That was the case with the purchase of uncompleted flats in the past and that is still the method used in the speculation of old domestic units. That is not a theoretical situation. As a solicitor who has practised for more than 10 years, I have seen many people doing it. Now, with the introduction of the stamp duty measure, the assignee has to pay the stamp duty for every assignment. I think this is an effective measure to curb speculation and its effectiveness has also been generally acknowledged. Although this measure is still inadequate, the question, as the Honourable Mrs Selina CHOW suggested, is : What will be the result if this measure is cancelled?

Earlier on, Mrs CHOW has mentioned that many people have lost a lot of money as a result of the suppression of property prices and it is hoped that property prices will rise again. I hope that is not what Mrs CHOW meant. I really hope that that is not what she meant. However, we have to be very clear that this is only a temporary measure, though I do not think it will cause any unfairness. We have to emphasize time and again that at present, it is the assignee who has to pay the stamp duty. In fact, it is only fair that stamp duty is payable on every assignment of property rights. Therefore, when the Secretary for the Treasury said that a long-term review has to be carried out, I think that is a good thing. However, in the meantime, we have to spend time to review the situation and we must not give people a wrong message. We will certainly not agree should this be a measure to intervene in the market; but this is in fact a measure to increase the costs of property speculators and a way to obtain money and revenue for the Inland Revenue Department through what we think is a reasonable approach. I do not see any disadvantage and it has not created an unfair situation.

Mr President, I would like to emphasize one last point. Relying on the levy of stamp duty to curb property speculation and to stabilize property prices is not enough, good co-ordination and continued efforts by the Government are also necessary. We certainly do not agree to take any steps at this stage which would give other people a wrong message that the Government intends to relax the measure. Mr President, we support the Government's motion today in the hope that a review can be completed in two years' time so that we will know what steps should be taken in the long run. I therefore oppose the Honourable Ronald ARCULLI's amendment. Thank you.

MR ALLEN LEE (in Cantonese): Mr President, I would only like to point out that perhaps the Honourable Albert HO might have got it wrong; he used the word "cancel" just now but the Honourable Ronald ARCULLI has proposed to review, and not to cancel the measure, after a year. The use of the word "cancel" may mislead Members of this Council.

SECRETARY FOR THE TREASURY (in Cantonese): Mr President, although speculative activities in the property market have now slowed down, this does not mean that we can lower our guard. We must do our best to avoid sending any message which may make the market think that we would gradually relax or even cancel the measure related to stamp duty. In fact, with respect to property transactions which occur before or shortly after the signing of deeds of assignment, this is, cases of property re-sale, although the number has dropped from 16 023 cases in 1993 to 15 184 cases in 1994-95, 5 000 such cases were still recorded in the first six months of 1995-96. For that reason, we believe that there is a great need for the continued implementation of this particular measure. I do not accept the argument that cancelling the measure related to stamp duty can boost the economy. I believe that as far as property speculation is concerned, this will only reduce ......

PRESIDENT: Mr Allen LEE, do you have a point of order? Are you seeking elucidation?

MR ALLEN LEE: Yes.

PRESIDENT: Are you prepared to yield, Secretary for Treasury?

MR ALLEN LEE: The Secretary kept mentioning about cancelling. But Mr ARCULLI is not proposing cancelling. It is an extension to one year. So he has used the word three times already.

SECRETARY FOR THE TREASURY (in Cantonese): Mr President, perhaps the Member could not hear clearly what I just said. I said we should avoid giving any message that would make the market think there would be gradual relaxation or cancellation of this measure. I was only referring to the giving of a message. Allow me to continue with my speech.

I do not agree with the point that cancellation of the stamp duty measure can stimulate the economy. I think this will only cut the cost of the property speculators and indirectly encourage speculation activities on the property market. I have to emphasize that the measure on stamp duty is working well and it does not affect the genuine home buyers. The Honourable LEE Wing-tat has just explained the reason for this. In fact, if there are more speculation activities because of the cancellation of this measure, the cost of the genuine home buyers will be increased. Therefore, I hope Members will support the proposal to extend the stamp duty measure for two years.

Question on the amendment put.

Voice votes taken.

THE PRESIDENT said he thought the "Noes" had it.

Mr Ronald ARCULLI claimed a division.

PRESIDENT: Council shall proceed to a division.

PRESIDENT: I would like to remind Members that they are called upon to vote on the question that the amendment moved by Mr Ronald ARCULLI be made to the Secretary for the Treasury's motion.

PRESIDENT: Will Members please register their presence by pressing the top button in the voting units on their respective desks and then proceed to vote by selecting one of the three buttons below?

PRESIDENT: Before I declare the results, Members may wish to check their votes. Are there any queries? The result will now be displayed.

Mr Allen LEE, Mrs Selina CHOW, Mr NGAI Shiu-kit, Mr LAU Wong-fat, Mr Edward HO, Mr Ronald ARCULLI, Mrs Miriam LAU, Dr LEONG Che-hung, Mr CHIM Pui-chung, Mr Frederick FUNG, Mr Eric LI, Mr Howard YOUNG, Mr James TIEN, Mr Paul CHENG, Mr CHOY Kan-pui, Mr David CHU, Mr Ambrose LAU, Dr LAW Cheung-kwok, Mr Bruce LIU, Mr MOK Ying-fan and Miss Margaret NG voted for the amendment.

Mr Martin LEE, Mr SZETO Wah, Mr CHEUNG Man-kwong, Mr Michael HO, Dr HUANG Chen-ya, Miss Emily LAU, Mr LEE Wing-tat, Mr Fred LI, Mr James TO, Dr Samuel WONG, Dr Philip WONG, Dr YEUNG Sum, Mr WONG Wai-yin, Miss Christine LOH, Mr LEE Cheuk-yan, Mr CHAN Kam-lam, Miss CHAN Yuen-han, Mr Andrew CHENG, Mr CHENG Yiu-tong, Mr Anthony CHEUNG, Mr CHEUNG Hon-chung, Mr Albert HO, Mr IP Kwok-him, Mr LAU Chin-shek, Mr LAW Chi-kwong, Mr LEE Kai-ming, Mr LEUNG Yiu-chung, Mr NGAN Kam-chuen, Mr SIN Chung-kai, Mr TSANG Kin-shing, Dr John TSE, Mrs Elizabeth WONG and Mr YUM Sin-ling voted against the amendment.

THE PRESIDENT announced that there were 21 votes in favour of the amendment and 33 votes against it. He therefore declared that the amendment was negatived.

Question on the original motion put and agreed to.

MEMBER'S MOTIONS

INTERPRETATION AND GENERAL CLAUSES ORDINANCE

DR LEONG CHE-HUNG to move the following motion:

    "That in relation to the -
  1. Civil Aviation (Aircraft Noise) Ordinance (Amendment of Schedule) Notice 1995 published as Legal Notice No. 539 of 1995;
  2. Airport Authority Ordinance (71 of 1995) (Commencement) Notice 1995 published as Legal Notice No. 540 of 1995;
  3. Import (Radiation) (Prohibition) (Amendment) Regulation 1995 published as Legal Notice No. 541 of 1995;
  4. Import and Export (General) (Amendment) Regulation 1995 published as Legal Notice No. 542 of 1995;
  5. Import and Export (Fees) (Amendment) (No. 2) Regulation 1995 published as Legal Notice No. 543 of 1995;
  6. Import and Export (Registration) (Amendment) Regulation 1995 published as Legal Notice No. 544 of 1995;
  7. Ferry Services (Hongkong and Yaumati Ferry Company, Limited) (Determination of Fares) (Amendment) Ordinance 1995 published as Legal Notice No. 545 of 1995;
  8. Leveraged Foreign Exchange Trading (Calls) (Amendment) Rules 1995 published as Legal Notice No. 555 of 1995;
  9. Tax Reserve Certificates (Fourth Series) (Amendment) Rules 1995 published as Legal Notice No. 556 of 1995;
  10. Tax Reserve Certificates (Rate of Interest) Notice 1995 published as Legal Notice No. 557 of 1995;
  11. Prisoners' Education Trust Fund Ordinance (19 of 1995) (Commencement) Notice 1995 published as Legal Notice No. 558 of 1995;
  12. Official Languages (Amendment) Ordinance 1995 (51 of 1995) (Commencement) (No. 2) Notice 1995 published as Legal Notice No. 559 of 1995;
  13. Tax Reserve Certificates (Amendment) Ordinance 1995 (99 of 1995) (Commencement) Notice 1995 published as Legal Notice No. 560 of 1995;
  14. Official Languages (Authentic Chinese Text) (The Hongkong and Shanghai Banking Corporation Limited Ordinance) Order published as Legal Notice No. (C) 115 of 1995;
  15. Official Languages (Authentic Chinese Text) (Tramway Ordinance) Order published as Legal Notice No. (C) 116 of 1995; and
  16. Official Languages (Authentic Chinese Text) (Peak Tramway Ordinance) Order published as Legal Notice No. (C) 117 of 1995,

and laid on the table of the Legislative Council on 6 December 1995, the period referred to in section 34(2) of the Interpretation and General Clauses Ordinance for amending subsidiary legislation be extended under section 34(4) of that Ordinance until 10 January 1996."

DR LEONG CHE-HUNG: Mr President, I move the motion standing in my name on the Order Paper on behalf of the House. The motion seeks to extend the scrutiny period for the 16 items of subsidiary legislation tabled in the Council on 6 December 1995. As there is no sitting of the Legislative Council between 13 December 1995 to 10 January 1996, the deadline for Legislative Council intervention for these items of subsidiary legislation will fall on 3 January 1996 when there is no sitting.

In order to preserve Members' rights to amend any of these items, it is necessary to move an extension resolution to extend the period for intervention until 10 January 1996.

Mr President, I beg to move.

Question on the motion proposed, put and agreed to.

LEGISLATIVE COUNCIL (POWERS AND PRIVILEGES) ORDINANCE

MR LAU CHIN-SHEK

to move the following motion:

    "That for the purposes of enquiring into the circumstances surrounding the recent labour disputes involving imported workers under the Special Labour Importation Scheme for the Airport Core Programme Projects and related issues, the Legislative Council Panel on Manpower be authorized under section 9(2) of the Legislative Council (Powers and Privileges) Ordinance (Cap. 382) to exercise the powers conferred by section 9(1) of that Ordinance."

MR LAU CHIN-SHEK (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

Recently, labour disputes involving foreign workers of the airport projects have aroused much public concern, especially in relation to accusations of wage deductions and payment delays. In order to have an in-depth discussion of the matter, the Legislative Council Panel on Manpower held a special meeting on 5 December this year. Upon hearing the Administration's report on the labour disputes, the Panel was greatly shocked and disturbed about the unfair treatments received by the foreign workers. Although the Labour Department has stepped up its monitoring and enforcement efforts, the result is still disappointing. The Panel thinks that in order to assess the effectiveness of the new steps that have been taken or will be taken by the Government to protect the interests of foreign workers, it is necessary to understand the various arrangements for the importation of foreign labour, the role of the labour affairs companies and the extent of the contractors' responsibility. While the Government may conduct inquiries into individual cases on other aspects, the Panel thinks that it is necessary to conduct an in-depth inquiry in order to achieve the following aims:

  1. To understand the present procedures for the importation of labour and the circumstances under which wages are deducted and payments delayed;
  2. To assess whether the legislation enacted and the administrative measures adopted with a view to implementing and monitoring the Labour Importation Scheme are effective or not;
  3. To assess whether the new measures proposed by the Administration to control unlawful acts are effective or not;
  4. To put forth feasible means to strengthen the supervision, especially that of the Labour Importation Scheme; and
  5. To identify persons responsible for any unlawful acts.

In conducting this inquiry, the Panel on Manpower has to ask the parties concerned to provide evidence and relevant documents, but such parties may refuse to attend the inquiry or invoke the Legislation (Powers and Privileges) Ordinance for protection. In the circumstances, we have to ask this Council that the Panel be authorized under section 9(2) of the Legislative Council (Powers and Privileges) Ordinance to exercise the powers conferred by section 9(1) of the Ordinance. The Panel on Manpower, having submitted a report to the House Committee and obtained its support on 8 December, proposes the motion in this Council today. Now, I shall formally move the motion that the Legislative Council Panel on Manpower be authorized under section 9(2) of the Legislative Council (Powers and Privileges) Ordinance to exercise the powers conferred by section 9(1) of that Ordinance.

Mr President, with these remarks, I move the motion. Thank you.

Question on the motion proposed.

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, the recent outbreak of labour disputes on Airport Core Programme (ACP) work sites is a matter of serious concern to the Government. I should like to assure Members that a thorough investigation into each of the cases is being conducted. Hong Kong is a civilized society where the rule of law is paramount. We will not tolerate abuse of imported workers and will instigate prosecutions against those who may have breached the laws of Hong Kong. We fully appreciate Members' understandable concern about such cases and their desire to get to the truth to find out what went wrong and who is responsible. We share these sentiments entirely. However, it is not necessary nor appropriate for the Council to confer on the Manpower Panel the power under section 9 of the Legislative Council (Powers and Privileges) Ordinance to conduct an enquiry into the circumstances surrounding the labour disputes for the following reasons.

First, these labour disputes are already under investigation by the law enforcement agencies. The Labour Department has been making good progress in its investigations. In some of these cases, the investigations are at an advanced stage. Prosecutions relating to breaches under the Employment Ordinance are being considered in most of the disputes and hearings for the contractors and subcontractors involved have been arranged for this purpose. These hearings are an integral part of the due process which must be observed before taking a final decision on whether or not to lay charges. These investigation procedures are likely to be affected if the Manpower Panel of this Council is to conduct a parallel inquiry into the disputes. The use of the Legislative Council (Powers and Privileges) Ordinance whether to summon persons involved in the dispute or to ask for documents relating to the disputes will run the serious risk of delaying or jeopardizing our inquiries. I am sure Members would not wish to see this happen.

The Immigration Department is investigating into the various dispute cases to see if there are any offences under the Immigration Ordinance. The police are also at present investigating six constructions sites in connection with the recent labour disputes to ascertain whether any person has breached the law. Before these investigations are completed, any action taken by the Legislative Council to invoke the powers under the Legislative Council (Powers and Privileges) Ordinance to enquire into the circumstances of the cases may prejudice the outcome of such investigations. Any discrepancies in the statements and testimony of the same witnesses called by the police, the Immigration Department and the Panel, and the premature release of documents or evidence in connection with the cases possessed by the law enforcement agencies may impede the progress of our investigations and may adversely affect the chance of subsequent prosecutions.

Secondly, we have been in contact with the New China News Agency and are working with the relevant Chinese authorities with a view to improving communication and co-operation particularly in respect of the operation of and the legal charges imposed by the Chinese labour service companies to ensure that imported workers from PRC are aware of their rights and benefits, and to safeguard them from being exploited. I understand that the Chinese authorities have already set up a special team to investigate at their end the complaints about wage deductions. There is therefore no urgent need for this Council or the Manpower Panel to carry out an enquiry at this stage. Indeed, Members should await the outcome of the efforts by both Governments before deciding whether any further action is warranted.

As an open and accountable Government, we fully acknowledge that the public has the right to know more about the causes of and the results of our investigations into the current labour disputes. We have no intention of hiding the truth from members of the public. I intend to present to this Council in about three months' time a detailed report on the results of all our investigation efforts. This report will not only set out the outcome of investigations in Hong Kong, but will also include information about the role of the labour service companies and the result of our liaison efforts with the Chinese authorities. This will enable both Members and the general public to have a full picture of the problems involved, their causes, the effect of the various remedial measures we have recently taken and any further recommendations we may put forward to enhance the integrity of the system. Members will be given ample opportunity to discuss and raise questions on this report.

I personally led the team of officials and senior representatives of the Airport Authority (AA) and MTRC to answer questions on the ACP labour disputes at the Special Manpower Panel Meeting on 5 December 1995. My colleagues and I, including the authorities concerned, AA and MTRC, are very much prepared to continue to co-operate fully with the Manpower Panel without prejudice to our investigations. The exercise of the Legislative Council powers and privileges, if targeted at the Administration and the other institutions mentioned above, is absolutely unnecessary.

We have already provided information to the Manpower Panel on the nature of the recent labour disputes. I do not wish to repeat here. However I would like to reiterate that we have already added new conditions to strengthen our monitoring system to minimize the possibility of abuse of the scheme. With effect from 1 November 1995, employers are required to: (1) give a copy of employment contract to his imported workers; (2) provide them with details of their monthly earnings; (3) provide them with a monthly statement showing all transactions of their bank accounts. Within eight weeks upon the arrival of an imported worker in Hong Kong, the employer is required to grant him paid leave to enable him to attend briefings on his statutory rights as an employee under Hong Kong labour laws and his contractual rights under the employment contract. On top of these measures which are already in force, we intend to require employers to give an undertaking to the Labour Department that the imported workers have received a copy of the employment contract specifying the post and amount of wages before they come to Hong Kong. Officers of the Immigration Department will ask the imported worker to present his employment contract for inspection purpose shortly upon their arrival in Hong Kong.

I would like to assure this Council once again that we do not and will not tolerate any abuse of imported workers. We are committed to upholding the integrity of the ACP Labour Importation Scheme. Malpractices by a few threaten the good name of other law-abiding employers and the good name of Hong Kong. We are fully committed to do everything within our power to combat abuses and malpractices. Labour Inspectors of the Labour Department conduct regular inspections to the places of work of imported workers to check whether provisions under the Employment Ordinance and the Employees' Compensation Ordinance have been complied with and to guard against other abuses which constitute breaches of the conditions under the Scheme.

I would also like to make clear, once again, that without prejudice to any prosecutions under the laws of Hong Kong, employers who are found to have contravened conditions of the scheme will be liable to: (1) withdrawal of quotas in hand; (2) refusal of application for extension of stay of the employee upon expiry of visa; and (3) refusal of application to import labour under the ACP scheme in future.

To conclude, I would assure Members again that we have been proceeding with our investigations into the labour disputes and related problems as a priority task. We are making every effort to improve the effectiveness of the various controls and safeguards under the ACP Scheme. The whole process of our work is open and transparent. We will work closely with concerned Members of this Council, the Manpower Panel and other interested parties during this process. We are open and receptive to any suggestions and advice on how we can improve the operational and monitoring system of the Scheme.

We do not see a need at this stage for this Council to empower the Manpower Panel under section 9 of the Legislative Council (Powers and Privileges) Ordinance to conduct hearings and enquiries into these labour disputes. We are very concerned that this will run the risk of prejudicing the Government's investigation efforts and thus will not be in the interest of the workers or the community as a whole. I would therefore ask Members to consider this motion in the light of my comments and vote against it. In the event this motion is passed, I will urge Members of the Council and the Manpower Panel to await and examine the Administration's detailed investigation report which we will, I repeat, submit in about three months' time before considering whether or not to invoke the Legislative Council (Powers and Privileges) Ordinance to conduct hearings and enquiries.

Thank you.

SECRETARY FOR TRADE AND INDUSTRY: Mr President,

  1. We do not have statistics on the number of accidents involving industrial and household glassware products and installations. Industrial accident statistics are analyzed by cause and by industry. There is no breakdown by either the material or the equipment involved in industrial accidents. The Hospital Authority compiles patient statistics according to international classification of diseases. It does not have separate figures on the number of accidents involving use or installation of glassware products.
  2. The safety of glassware products for private use or consumption is already covered by the Consumer Goods Safety Ordinance, which came into force in October this year. This Ordinance imposes a statutory duty on manufacturers, importers and suppliers of consumer goods (including glassware products) to ensure that the goods they supply in Hong Kong are safe. Section 4 of the Ordinance further requires that consumer goods (including glassware products) supplied in Hong Kong must comply with a general safety requirement which includes, inter alia, the adoption of reasonable safety standards published by a standards institute. Any supplier who fails to comply with the requirement under the Ordinance commits an offence. The Commissioner of Customs and Excise will monitor the situation and take enforcement action as appropriate.
    Accordingly, we do not see the need to introduce specific regulations to stipulate the safety standards for household glassware products and to require manufacturers to specify on their products the types of glass used and the level of durability measured in an impact test.

Relocation of Methadone Clinic to Tsui Ping Estate

13. MR FRED LI asked (in Chinese): The 10-year redevelopment programme for Kwun Tong Town Centre proposed by the Land Development Corporation includes the relocation of the methadone clinic at the Town Centre to Tsui Ping Estate nearby. As methadone clinics often bring nuisance to the community in which they are located, will the Government inform this Council:

  1. whether it will consult local community groups and residents in this regard; if so, what are the details; if not, why not;
  2. whether the Government will make alternative arrangements to set up the methadone clinic further away from Tsui Ping Estate in view of the worsening drug abuse problem in that Estate; and
  3. what long-term and interim measures the Government has adopted to tackle the drug abuse problem in the neighbourhood of Tsui Ping Estate?

SECRETARY FOR SECURITY: Mr President,

  1. The Kwun Tong Town Centre Redevelopment Scheme proposed by the Land Development Corporation (LDC) is still being considered by the Corporation and the Administration. If the Scheme is to be implemented, the Kwun Tong District Board, and other relevant local bodies, where appropriate, will be consulted in advance on any proposal to relocate the methadone clinic.
  2. No decision has been made on whether and where the methadone clinic in Kwun Tong should be relocated. The Government is open-minded about the location of methadone clinics. An important consideration is the accessibility of the clinic, as the objective of the methadone programme is to offer a readily accessible out-patient service for those drug abusers who seek treatment but, for various reasons, would not be able to take part in residential treatment programmes.
  3. The drug abuse problem in the neighbourhood of Tsui Ping Estate is being tackled at source by stepped-up law enforcement action, and preventive education and publicity.
    Police enforcement action against drug activities in Tsui Ping Estate has been stepped up. This can be seen from the number of arrests for serious narcotics offences in Tsui Ping Estate, which has increased from 46 in 1994 to 80 in the first nine months of 1995. At the street level, enhanced enforcement actions are taken on a daily basis against drug sellers and users. Information and intelligence on drug activities, with particular emphasis against drug sellers, are collected, collated and acted upon by the Kwun Tong District Special Duties Squad to target known drug sellers.
    The police also contributes to anti-drug education by organizing school visits and seminars with school headmasters and discipline masters, focussing on the prevention of drug abuse by students.
    Extra efforts have been put in preventive educational and publicity measures to arouse awareness among Kwun Tong residents on the drug problem. Emphasis has been laid on enhancing parents' understanding on the prevention and early detection of their children's involvement in drugs. In 1995-96, a total of seven programmes involving 10 000 participants have been/will be implemented by the social welfare service units in the district. Existing counselling services of family service centres and probation offices in the district have also been strengthened to help young people with drug problems and their families.
    The District Social Welfare Office (DSWO) in Kwun Tong has formed a Working Group on "District-wide publicity campaign in combating illicit use of drugs among young people in Kwun Tong District" in April*1995, to promote co-ordination and co-operation among government departments and local organizations to tackle the drug problem. A "Drug Ambassador Scheme" is now being launched by the Working Group, with the aim of publicizing widely anti-drug messages among young people through a signature campaign. So far over 7 000 participants from more than 30 local organizations have been enrolled. The Working Group also compiles leaflets on district beat-drug activities on a regular basis to encourage participation of local residents.
    In the longer term, the DSWO in Kwun Tong will continue to take active part in the Kwun Tong District Fight Crime Committee to plan and co-ordinate anti-drug strategies at the district level. Group work units in the district, particularly the Group Work Unit of the Kwun Tong Community Centre (which is located in Tsui Ping Estate) will organize regular activities to educate young people to stay away from drugs. Services from the "Against Substance Abuse Scheme" provided by the team of specially trained social workers newly set up by the Social Welfare Department would also be tapped whenever necessary.
    A paper on "Illicit use of drugs in Kwun Tong District" was discussed at the Kwun Tong District Fight Crime Committee meeting in May*1995 to co-ordinate district efforts in tackling the problem. Local non-government organizations will be encouraged to organize anti-drug activities through various channels such as the Kwun Tong District Committee on Family Life Education, the Kwun Tong District Group and Community Work Service Co-ordinating Committee. Social workers of the Society for the Aid and Rehabilitation of Drug Abusers working in the methadone clinic in the district will continue to provide casework services to drug abusers to facilitate their social rehabilitation.

Air Services to Taiwan

14. MR LAW CHEUNG-KWOK asked (in Chinese): Will the Government inform this Council:

  1. whether, in order to be eligible to apply for a licence to operate air services between Hong Kong and Taiwan, the China National Aviation Corporation (CNAC) has made a formal application to become an airline whose principal operation is based in the territory; if so, what factors the Government will take into consideration in determining whether a licence will be granted to CNAC to operate the route; if not, whether it will consider inviting CNAC to make such an application; and
  2. what share of the market does the Cathay Pacific Airways (CPA) have in providing air services between Hong Kong and Taiwan, and whether CPA has adopted any policy which is not in the interest of the consumers?

SECRETARY FOR ECONOMIC SERVICES: Mr President,

  1. The China National Aviation Corporation (Hong Kong) Limited (CNAC(HK)) submitted an application for an Air Operator's Certificate (AOC) to the Civil Aviation Department (CAD) on 29 March 1995. Securing an AOC is a necessary prerequisite to operate Hong Kong registered aircraft for the purpose of public transport. An AOC may be granted if the Governor is satisfied that the applicant is competent, having regard in particular to his previous conduct and experience, his equipment, organization, staffing, maintenance and other arrangements to secure the safe operation of aircraft of the types specified in the certificate. CNAC(HK) has not yet submitted any documents in support of its application. CAD will give due consideration to the application when such documents are received.
    An application for an AOC is the first of several steps which a company has to go through before it will be able to mount scheduled air services with Hong Kong registered aircraft. In addition, the company will also have to apply for registration of its aircraft, obtain a licence for a specific route from the Air Transport Licensing Authority and seek designation by the Government for the route concerned. It is not government policy to invite any particular airline to make an application for any route; the airline concerned would have to apply and fulfill all the necessary requirements before it will be permitted to operate.
  2. At present, scheduled air services between Hong Kong and Taiwan are operated between Hong Kong and two cities in Taiwan, namely, Taipei and Kaohsiung. On the Hong Kong - Taipei route, the Cathay Pacific Airway's (CPA's) market share was 51.1% in the 12 months up to August 1995. On the Hong Kong - Kaohsiung route, CPA's market share was 53.8% in the same period.
    On both of the routes between Hong Kong and Taiwan, there is a choice for consumers. On the Hong Kong * Taipei route (which constitutes 82% of the total traffic between Hong Kong and Taiwan), six other airlines, apart from CPA, operate on the route. They are British Asia Airways, China Airlines, Japan Asia Airways, Singapore Airlines, Garuda Indonesia Airways, and Thai Airways International. On the Hong Kong * Kaohsiung route where traffic is only about 18% of the total traffic between Hong Kong and Taiwan, China Airlines operate on the route in addition to CPA.

Application and Approval of Search Warrants

15. MR CHIM PUI-CHUNG asked (in Chinese): In regard to applications for search warrants by government departments, will the Government inform this Council:

  1. of the criteria on which the court's approval of an application for search warrant file by a government department is based and whether there is any system to keep this power in check;
  2. whether the court or the department which files the application will be held responsible in the event that the application is subsequently proved to be at fault or ultra vires;
  3. of the time normally taken for obtaining a search warrant; and
  4. if members of the public have objections to be contents of an application for search warrant, to which department should they go to in order to raise their objection prior to the grant of the search warrant?

CHIEF SECRETARY: Mr President,

  1. In granting applications for search warrants, the court acts in accordance with the provisions in the relevant legislation under which the applications are made. The magistrate responsible will make sufficient enquiry to satisfy himself that there is reasonable cause to suspect that the items in respect of which the warrant is sought are on the premises to be searched. Such enquiry could include questioning the police officer requesting the search warrant under oath or affirmation or requiring the information in support of the warrant to be more precise.
    The power to grant warrants is discretionary. Therefore, a magistrate is not required to accede to an application for a search warrant even where the statutory requirements have been met. This together with the fact that a magistrate must refuse to grant a warrant if he is not satisfied that there is reasonable cause to suspect that the items in respect of which the warrant is sought are on the premises to be searched, serves to keep searches by government departments in check.
  2. Whether the court or the department which filed the application would be held responsible in the event that the application is subsequently proved to be at fault or ultra vires depends upon the circumstances in which the search warrant was issued. In general terms, a court could only be held responsible where it was established that it was acting maliciously and without reasonable and probable cause; and a government department could only be held responsible where it was established that it was acting maliciously.
  3. A department can normally obtain a search warrant from the court on the same day it files an application.
  4. An application for a search warrant is made ex parte, that is, only the party making the application is present. To inform the owner of the premises to be searched of the application would defeat the purpose of the search.

Air-tickets for Civil Servants on Duty Visits

16. MR CHEUNG MAN-KWONG asked (in Chinese): With regard to the purchase of air-tickets by the Government for civil servants on overseas duty visits and training, will the Government inform this Council:

  1. of its policy on purchasing such air-tickets;
  2. whether agreements have been made with any airlines for the purchase of air-tickets; if so, what are the details and why such agreements have been made;
  3. of the expenditure involved in purchasing such air-tickets during the past two years, together with a breakdown of the number of civil servants involved and their destinations;
  4. whether the Government has information to show that the adoption of its present policy on the purchase of such air-tickets, as compared with purchases made through travel agents or by other means, will result in a higher expenditure of public funds; if so, what are the reasons for continuing with the present policy; and
  5. whether consideration has been given to reviewing the present policy on the purchase of such air-tickets; if so, what are the details; if not, whether the Government will consider adopting other arrangements to purchase such air-tickets, such as placing orders with the airline purchase such air-tickets, such as placing orders with the airline charging the lowest fares or introducing other forms of competition?

SECRETARY FOR THE CIVIL SERVICE: Mr President, the answers to the questions raised are:

  1. The Government has an agreement with the British Airways (BA) and Cathay Pacific Airways (CPA) under which air-tickets (from any airlines) for civil servants on overseas duty visits have to be purchased through Jardine Airways (BA's general agent) or CPA. Air-tickets for civil servants on overseas training are not covered by the agreement, and can be purchased through any travel agent which accepts direct payment by the Treasury.
  2. The passage agreement with BA and CPA basically covers the Government's duty and school passages, but the Government may also make use of the contract fares for other passages to and from the United Kingdom. The main features of the agreement are:

    1. BA and CPA provide air-tickets at reduced fares on the Hong Kong - United Kingdom direct route (the United Kingdom route); and
    2. air-tickets on non-United Kingdom routes (from any airlines) have to be purchased through Jardine Airways or CAP.
      The Government entered into an agreement with the two airlines because the service required by the Government was and remains mainly passages on the Hong Kong - United Kingdom direct route ─ the bulk of which relate to school passages. Until 1994 only BA and CPA provided direct-route service to the United Kingdom. With the exception of Virgin Atlantic Airways (VAA) which started operating on the Hong Kong - United Kingdom direct route in 1994, the other airlines do not provide direct-flight service on the this route and therefore are unable to participate. We are discussing with BA and CPA the possibility of including the service of VAA in the current agreement.
    3. The expenditure involved in purchasing air-tickets for civil servants' overseas duty visits and training in 1993-94 and 1994-95 is $85.4 million, involving a total of 5 956 return passages. We have not kept specific records on the destinations of these passages.
    4. On the whole, we are getting a reasonable deal out of the agreement with BA and CPA as the Government is able to benefit from the reduced fares on the Hong Kong - United Kingdom direct flights with guaranteed bookings in both peak and off-peak seasons. The current arrangement for the purchase of air-tickets for civil servants' overseas duty visits and training, even if considered on its own, does not incur a much higher public expenditure, since the costs of published-fare air-tickets are roughly the same irrespective of from which agent they are bought. We are using published fares because the lower-fare air-tickets available in the market are very often special or promotional-fare tickets with usage restrictions attached, which would frequently not meet the operational requirements of these duty visits.
    5. With a view to achieving further savings, we are discussing with BA and CPA the possibility of including the service of VAA in the current agreement. We are also reviewing the scope of our being able to make use of the cheaper air fares available in the market for civil servants' overseas duty visits and training.

Green Island Public Dump Scheme

17. MR AMBROSE LAU asked (in Chinese): Now that the Government is consulting the public on the feasibility of the Green Island Public Dump Scheme and that the removal of Hong Kong International Airport has been scheduled for 1998, will the Government inform this Council whether consideration will be given to transporting construction waste on Hong Kong Island by land or by sea to the waters off the Airport and Kowloon Bay for dumping as an interim measure, as such a move will prepare that area for the future reclamation work on the one hand and allow more time for the public to study the policies relating to the Green Island reclamation on the other?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, the Territory Development Department has commissioned a feasibility study on the proposed future development of Kowloon Bay and the current Hong Kong International Airport. The study will examine, among other things, the possible sources of fill material, including construction waste, suitable for the proposed reclamation at Kowloon Bay. Findings of the study will help the Government in considering the viability of public dumping at Kowloon Bay and/ or the Airport. The study is scheduled to be completed in mid-1997. No decision will be made before the Government has examined the findings thoroughly.

Oxygen Content in Air

18. DR SAMUEL WONG asked: The proportion of oxygen in the air in some urban districts is sometimes found to be as low as 10%, although the normal oxygen content in the air is about 20%. In such circumstances, people will have to inhale more air, and hence more pollutants, than normal in order to get the oxygen required. In this connection, will the Government inform this Council whether:

  1. the Government will consider releasing the multiplication factor of pollution intake in each district due to lower oxygen content along with the pollution indices now published daily by the Environmental Protection Department; and
  2. if the answer to (a) above is in the negative, whether the Government will consider taking such factor into account in determining the pollution indices?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, the Air Pollution Index is designed to reflect the quality of outdoor air, of which the oxygen content is constantly at the normal level of 20%. In the outdoor environment, the carbon dioxide level in Hong Kong is well below 0.5% and variations around this level of concentration will not affect the oxygen content of the air. The issue of low oxygen in outdoor air is only relevant to locations at altitudes above 10 000 feet; but this is not relevant to Hong Kong. It is therefore not necessary for the Air Pollution Index to take into account the oxygen content. Hence, the answers to both (a) and (b) are in the negative.

Monitoring of H Share Companies

19. DR HUANG CHEN-YA asked (in Chinese): Will the Government inform this Council whether:

  1. the Securities and Futures Commission (SFC) will make a comparison between the profits predicted in the prospectuses of H share companies and the performance of these companies as published after the first year;
  2. the SFC has carried out investigations into companies which have recorded marked discrepancies between the predicted and actual profits; if so, what are the findings; and
  3. there are statutory provisions requiring merchant banks to be responsible for the accuracy of the information contained in prospectuses; if so, what are the liabilities of the merchant banks in the event that the particulars in the prospectuses are found to be incorrect, and what penalties will be imposed on them; if not, whether the Government will require merchant banks to assume responsibility, so as to reduce the chance of investors being misled?

SECRETARY FOR FINANCIAL SERVICES: Mr President,

(a) and (b)

    The Stock Exchange of Hong Kong (SEHK) is the frontline regulator responsible for the supervision of listed companies and the administration of all related matters. The SFC oversees the SEHK but is not directly involved in such matters.

    The SEHK reviews the performance of all newly listed companies, including H share companies, for the first accounting year after their listings, and compares that with the projected profits stated in the respective prospectus of the companies.

    All listed companies are required to sign a Listing Agreement and to abide by the SEHK Listing Rules. Under the Listing Agreement, a listed company is obliged to notify shareholders promptly of the occurrence of any event which could cause the forecast assumptions to be materially different from those stated in the prospectus and to indicate the likely impact of such event on the projected profits. The Listing Agreement also requires a company in such circumstances to include an explanation for such material difference in its directors' report and accounts.

    The SEHK monitors compliance with the Listing Rules and carries out inquiries where necessary. During the past three years, the SEHK has found two cases (one of which involves an H share company) where the actual results published in the directors* report and accounts differed materially from the projected profits stated in the relevant prospectus. In both cases, the company involved has issued a clarification statement to the public in accordance with the relevant Listing Rules.

  1. There are no statutory provisions which expressly impose special responsibilities on merchant banks for the accuracy of prospectuses. However, there are statutory provisions under which merchant banks could be exposed to criminal and civil liabilities in respect of untrue statements in prospectuses. Such liability is imposed on every person who has authorized the issue of the prospectus containing untrue statements. Coming within the wide class of persons who authorize the issue of the prospectus can be brokers, merchant banks, solicitors and others associated with the prospectus.
    Civil liability is created by section 40 of the Companies Ordinance (the Ordinance) in respect of Hong Kong companies, and section 342E of the Ordinance in respect of companies incorporated outside Hong Kong. The liability is to persons who subscribe for securities on the faith of a prospectus and sustain loss or damage by reason of any untrue statement contained therein.

    Criminal liability is created by section 40A of the Ordinance in respect of Hong Kong companies and section 342F of the Ordinance in respect of companies incorporated outside Hong Kong. If a prospectus contains a false statement, any person who authorized its issue will be guilty of an offence unless he can establish certain specific defences.

    The penalty for breaching section 40A or section 342F of the Ordinance is a fine of $500,000 or imprisonment for three years on indictment, and a fine of $100,000 and imprisonment of 12 months on summary charge.

    If a merchant bank acts as a sponsor in relation to a listing, it also has to comply with the Model Code for Sponsors of the Listing Rules. The Code requires that the sponsor should be closely involved in the preparation of the listing document and in ensuring that all material statements therein have been verified and that it complies with the Listing Rules and all relevant legislation. Failure by a sponsor to meet its obligations under the Listing Rules without reasonable excuse may render that person unacceptable to the SEHK for performing the role of a sponsor in the future.

ADDRESS

Ocean Park Corporation Annual Report 1994-95

MR RONALD ARCULLI

: Mr President, tabled before the Council today is the 1994-95 annual report of the Ocean Park Corporation.

In the financial year that ended on 30 June 1995, the Ocean Park enjoyed another year of record attendance with 3.3 million visitors to the Park, an increase of 5% on last year's record of 3.2 million.

The Ocean Park's revenue grew by 6% to HK$324 million. Operating income was HK$319 million. The net operating surplus for the financial year was HK$23 million, which compared with a net operating surplus of HK$53 million in the 1993-1994 financial year.

These results are most satisfactory given the difficulties encountered during the year. The higher attendance figure was pleasing given that Hong Kong experienced a series of severe tropical storms during the year which necessitated partial closure of the Park.

The number of overseas visitors to the Park fell by 9% mainly due to the drop in the number of tourists from China and Taiwan. Fortunately, more local residents visited the Park. The record number of visitors was largely due to improvements in the Ocean Park and new attractions which opened during the year.

Three new attractions costing a total of HK$58 million were opened in time for the Christmas-New Year holidays. On the Headland, we opened the 100-foot tall Ferris Wheel which provides spectacular views 400 feet above the South China Sea. We also opened the Eagle Ride which proved extremely popular. However, it is currently closed while modifications are made and tested. We plan to have the ride fully operational early next year. On the Lowland, we opened the Dinosaur Discovery Trail which, with its lifelike models and animatronic robots, proved an instant success with the public.

The largest influx of visitors came during the spring in response to the re-opening of the Atoll Reef. The Atoll Reef has traditionally been the Park's most popular attraction. The Reef has undergone a HK$65 million refurbishment and is now the largest reef aquarium in the world.

During its first full year of operation, the Ocean Park Conservation Foundation announced a five-year plan involving 16 whale and dolphin projects which include identification of conservation problems, development and executive of action plans, and long-term research to direct and support future marine mammal conservation efforts in the region.

The Foundation also convened the first meeting of the Asian River Dolphin Committee. Scientists from nine countries, including China, and representatives of the IUCN Cetaccan Specialist Group and The Whale and Dolphin Conservation Society met to discuss strategies for protecting threatened marine mammals.

The Ocean Park has an on-going commitment to improve access to the Park's facilities for Hong Kong's disabled residents. This year, new facilities for the disabled included contour models for mechanical rides, tactile maps and guide books for the visually impaired, improved access for wheelchair-bound visitors and the installation of a special gondola for disabled visitors on the new Ferris Wheel.

While the recent difficulties experienced at the Park fall outside this financial year, it would be remiss of me not to congratulate the management and staff on the way they handled the consequences of the tragic Aberdeen landslide.

Through their work, the comfort and safety of both visitors and of the Park's marine mammals, fish and animals were assured, and the Park was able to return to normal operations in a speedy manner. Above all, we owe special thanks also to the Government Flying Service, the Fire Services Department and the Electrical and Mechanical Services Department.

Looking to the future, our long-term development plan is to continue to expand and to better serve the needs of all age groups and interests within the community. In the next year, we expect to have further improvements and add new attractions including the opening of a Mine Train roller coaster and a high-tech simulator ride.

After a year that was both rewarding and eventful, the Ocean Park will continue to work to fulfill its mission to provide a balanced mix of recreation, education and conservation. I believe the Ocean Park is well set to achieve even higher levels of popularity and success.

Thank you, Mr President.

MOTIONS

EMPLOYEES' COMPENSATION ORDINANCE

THE SECRETARY FOR EDUCATION AND MANPOWER to move the following motion:

    "That, with effect from 1 January 1996, the Employees' Compensation Ordinance be amended as follows -
  1. in section 6 -
    1. in subsection (1)(a), (b) and (c), by repealing "$15,000" and substituting "$18,000";
    2. in subsection (2), by repealing "$219,000" and substituting "$262,000";
    3. in subsection (5), by repealing "$12,000" and substituting "$14,000";
  2. in section 7 -
    1. in subsection (1)(a), (b) and (c), by repealing "$15,000" and substituting "$18,000";
    2. in subsection (2), by repealing "$248,000" and substituting "$297,000";
  3. in section 8(1)(a) and (b), by repealing "$297,000" and substituting "$356,000";
  4. in section 11(5), by repealing "2,250" where it twice appears and substituting "2,450";
  5. in section 16A(10) -
    1. in paragraph (a), by repealing "$350" and substituting "$420";
    2. in paragraph (b), by repealing "$700" and substituting "$840";
  6. in section 17A(1) -
    1. in paragraph (a), by repealing "$350" and substituting "$420";
    2. in paragraph (b), by repealing "$700" and substituting "$840";
  7. in section 36C, by repealing "$24,000" and substituting "$28,000";
  8. in section 36J, by repealing "$74,000" and substituting "$86,000";
    1. in paragraphs 1(b), 2(b) and 3 of the Third Schedule, by repealing "$120" and substituting "$160"."

He said (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

The purpose of this resolution is to revise the levels of compensation and certain compensation-related items under the Employees' Compensation Ordinance. The Ordinance provides for payment of compensation by employers to employees who are injured or killed as a result of employment-related accidents. Our policy since 1978 has been to review the levels of compensation every two years to take account of wage movements, inflation and other changes. The existing levels of compensation have been in force since 1 January 1994 and are now due for revision. We propose that the revised rates should take effect as from 1 January 1996.

We propose to increase the ceiling for monthly earnings from $15,000 to $18,000. This figure is the basis on which the maximum amounts of compensation for permanent total incapacity and for death are calculated under the Ordinance. We also propose to increase the minimum levels of compensation for death from $219,000 to $262,000, and for permanent total incapacity from $248,000 to $297,000. In addition, we propose that the maximum amount of compensation for the costs of care required by another person be revised from $297,000 to $356,000. For late payment of compensation, we propose to increase the minimum amount of surcharge imposed upon expiry of the payment period from $350 to $420 and the minimum additional surcharge imposed three months after expiry of payment period from $700 to $840. Each of these six proposed revisions represents an increase of about 19.7% over the existing levels, which is in line with the increase in nominal wages during the past two years.

The ceilings on three other forms of compensation are to be adjusted to take account of inflation since their last revision in 1994. The proposed changes include increasing the maximum amount for burial expenses from $12,000 to $14,000, and increasing the maximum payments to be made by an employer towards the costs of supplying and fitting a prosthesis or a surgical appliance from $24,000 and $74,000 respectively to $28,000 and $86,000 respectively.

We also propose to raise the maximum daily rate of reimbursement of medical expenses from $120 to $160 to take account of the increase in fees charges by public hospitals and clinics since 1994.

Finally, we propose to revise the amount that is deemed to be the minimum earnings per month for the purpose of calculating compensation from $2,250 to $2,450. This proposed increase serves to keep the deemed minimum earnings of an injured employee broadly in line with the existing rate of payment to a singleton under the Comprehensive Social Security Assistance Scheme.

These proposals have been endorsed by the Labour Advisory Board and I recommend them to this Council for approval.

Mr President, I beg to move.

Question on the motion proposed.

MR LAU CHIN-SHEK (in Cantonese): Mr President, I certainly support today's motion which seeks to increase the rate of compensation for workers who were injured or even killed in the course of their work. However, I would also like to take this opportunity to state again what I think are the shortcomings of the present Employees' Compensation Ordinance, hoping that the Government will review the whole system of workers' compensation as soon as possible.

The legislation currently in force has stipulated various ceilings for calculating the rate of compensation for workers who have permanently lost the ability to work in the course of their work and has made it impossible for workers to obtain the compensation that they deserve. First, concerning the calculation of the monthly wage ceiling. Although today's motion seeks to increase the monthly wage ceiling from $15,000 to $18,000, that is still an unreasonable restriction, especially in the construction sector in which workers suffer serious injuries. For the many steel fixers, scaffold erectors and the majority of other professionals who may be earning a monthly wage exceeding $18,000, the present legislation has undoubtedly deprived them of the compensation that they deserve. Therefore the Government should consider abolishing the monthly wage ceiling. In fact, the present monthly wage ceiling for the calculation of severance pay and long service payment has already been increased to $22,500, but that for the calculation of workers' compensation is only to be increased to $18,000. This is obviously an unfair treatment to workers claiming workers' compensation.

Second, concerning the upper limit of the amount of compensation. According to the Employees' Compensation Ordinance, the maximum amount of compensation which workers can claim of the basis of injury or death sustained in the course of work is equivalent to seven years or eight years of their total income respectively. These ceilings, which have been set without and objective criteria, are particularly unfair to young workers seeking workers' compensation. For instance, a 17-year-old summer job worker was killed in an accident involving a hoist in North Point in June 1993. According to the law, he could only obtain compensation equivalent to eight years of his total wage and deductions had to be made according to the family's reliance on him. As a result, this worker's family could only obtain compensation amounting to $100,000 plus. Do you think that is fair? Human life is invaluable and the law which has imposed various restrictions on workers' compensation should absolutely be reviewed and improved. The Government may think that workers claiming workers' compensation can try to obtain more by suing their employers for negligence through civil proceedings. However, legal proceedings not only involve many problems of evidence, they are also very time-consuming; and a law suit will normally drag on for three to five years. That is undoubtedly unfair to the injured workers and their families. Therefore, I think a comprehensive review on the Employees' Compensation Ordinance should be conducted without delay so as to strengthen the protection given to workers claiming workers' compensation. Of course, what is more important is to improve industrial safety in Hong Kong so as to prevent the occurrence of accidents.

Mr President, with these remarks, I hope the Secretary for Education and Manpower can clearly respond to my demands in his concluding speech later on. Thank you.

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, I would like to thank the Honourable LAU Chin-shek for his speech as well as his support for this motion. I have listened very carefully to the views expressed by Mr LAU on some items. The Government will consider these views in detail in the next review. There is no doubt that we will fully consider the views of both the employers and employees with regard to this Ordinance in every review.

Thank you, Mr President.

Question on the motion put and agreed to.

PNEUMOCONIOSIS (COMPENSATION) ORDINANCE

THE SECRETARY FOR EDUCATION AND MANPOWER to move the following motion:

    "That, with effect from 1 January 1996, the Pneumoconiosis (Compensation) Ordinance be amended as follows -
  1. in the First Schedule -
    1. in paragraph 1 of Part II, by repealing "$2,100" and substituting "$2,570";
    2. in Part IV, by repealing "$3,500" and substituting "$4,050";
    3. in Part VI, by repealing "$12,000" and substituting "$14,000";
  2. in the Second Schedule, in paragraphs 1(b), 2(b) and 3 of Part I, by repealing "$120" and substituting $160".

He said (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

The purpose of this resolution is to revise the levels of compensation and certain compensation-related items under the Pneumoconiosis (Compensation) Ordinance. The Ordinance provides for payment of compensation for persons who were diagnosed after 1 January 1981 to be suffering from pneumoconiosis. We propose that the revised rates should take effect as from 1 January 1996.

We propose to raise the ceilings in respect of two items of compensation under the Ordinance to take account of inflation and wage movements since July 1993. First, we propose to increase the amount for calculating the monthly compensation for total incapacity, from $2,100 to $2,570. In this respect, it should be noted that under the Pneumoconiosis (Compensation) (Amendment) Bill which was introduced into this Council on 6 December 1995 (that is last Wednesday), the amount of $2,100 was proposed to be made a separate compensation item for pain, suffering and loss of amenities which would be paid to all eligible pneumoconiotics regardless of their degree of incapacity. Therefore, if this proposed revision is approved, we will move a Committee Stage Amendment to the Bill to revise the amount to $2,570. Secondly, we prepare to increase the amount of compensation for care and attention from $3,500 to $4,050.

OFFICIAL RECORD OF PROCEEDINGS
Wednesday, 13 December 1995
The Council met at half-past Two o'clock

MEMBERS PRESENT

THE PRESIDENT
THE HONOURABLE ANDREW WONG WANG-FAT, O.B.E., 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 MARTIN LEE CHU-MING, Q.C., J.P.

DR THE HONOURABLE DAVID LI KWOK-PO, O.B.E., LL.D. (CANTAB), J.P.

THE HONOURABLE NGAI SHIU-KIT, O.B.E., J.P.

THE HONOURABLE SZETO WAH

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

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

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

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

DR THE HONOURABLE EDWARD LEONG CHE-HUNG, O.B.E., J.P.

THE HONOURABLE ALBERT CHAN WAI-YIP

THE HONOURABLE CHEUNG MAN-KWONG

THE HONOURABLE CHIM PUI-CHUNG

THE HONOURABLE FREDERICK FUNG KIN-KEE

THE HONOURABLE MICHAEL HO MUN-KA

DR THE HONOURABLE HUANG CHEN-YA, M.B.E.

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 HENRY TANG YING-YEN, J.P.

THE HONOURABLE JAMES TO KUN-SUN

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

DR THE HONOURABLE PHILIP WONG YU-HONG

DR THE HONOURABLE YEUNG SUM

THE HONOURABLE HOWARD YOUNG, J.P.

THE HONOURABLE ZACHARY WONG WAI-YIN

THE HONOURABLE CHRISTINE LOH KUNG-WAI

THE HONOURABLE JAMES TIEN PEI-CHUN, O.B.E., J.P.

THE HONOURABLE LEE CHEUK-YAN

THE HONOURABLE CHAN KAM-LAM

THE HONOURABLE CHAN WING-CHAN

THE HONOURABLE CHAN YUEN-HAN

THE HONOURABLE ANDREW CHENG KAR-FOO

THE HONOURABLE PAUL CHENG MING-FUN

THE HONOURABLE CHENG YIU-TONG

THE HONOURABLE ANTHONY CHEUNG BING-LEUNG

THE HONOURABLE CHEUNG HON-CHUNG

THE HONOURABLE CHOY KAN-PUI, J.P.

THE HONOURABLE DAVID CHU YU-LIN

THE HONOURABLE ALBERT HO CHUN-YAN

THE HONOURABLE IP KWOK-HIM

THE HONOURABLE LAU CHIN-SHEK

THE HONOURABLE AMBROSE LAU HON-CHUEN, J.P.

DR THE HONOURABLE LAW CHEUNG-KWOK

THE HONOURABLE LAW CHI-KWONG

THE HONOURABLE LEE KAI-MING

THE HONOURABLE LEUNG YIU-CHUNG

THE HONOURABLE BRUCE LIU SING-LEE

THE HONOURABLE LO SUK-CHING

THE HONOURABLE MOK YING-FAN

THE HONOURABLE MARGARET NG

THE HONOURABLE NGAN KAM-CHUEN

THE HONOURABLE SIN CHUNG-KAI

THE HONOURABLE TSANG KIN-SHING

DR THE HONOURABLE JOHN TSE WING-LING

THE HONOURABLE MRS ELIZABETH WONG CHIEN CHI-LIEN, C.B.E., I.S.O., J.P.

THE HONOURABLE LAWRENCE YUM SIN-LING

PUBLIC OFFICERS ATTENDING

THE HONOURABLE DONALD TSANG YAM-KUEN, O.B.E., J.P. FINANCIAL SECRETARY

THE HONOURABLE JEREMY FELL MATHEWS, C.M.G., J.P. ATTORNEY GENERAL

MR CHAU TAK-HAY, C.B.E., J.P. SECRETARY FOR RECREATION AND CULTURE

MR NICHOLAS NG WING-FUI, J.P. SECRETARY FOR CONSTITUTIONAL AFFAIRS

MRS KATHERINE FOK LO SHIU-CHING, O.B.E., J.P. SECRETARY FOR HEALTH AND WELFARE

MR JOSEPH WONG WING-PING, J.P. SECRETARY FOR EDUCATION AND MANPOWER

MR BOWEN LEUNG PO-WING, J.P. SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS

MR KWONG KI-CHI, J.P. SECRETARY FOR THE TREASURY

MR FUNG TUNG, O.B.E., J.P. SECRETARY FOR HOUSING

CLERKS IN ATTENDANCE

MR RICKY FUNG CHOI-CHEUNG, SECRETARY GENERAL

MR LAW KAM-SANG, DEPUTY SECRETARY GENERAL

MISS PAULINE NG MAN-WAH, ASSISTANT SECRETARY GENERAL

MR RAY CHAN YUM-MOU, ASSISTANT SECRETARY GENERAL

PAPERS

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

Subject

Subsidiary LegislationL.N. No.

Road Traffic (Public Service Vehicles) (Amendment) (No. 5) Regulation 1995 562/95

Hong Kong Airport (Restricted Areas and Tenant Restricted Areas) Order563/95
Road Traffic (Breath Analysing Instruments and Screening Devices) Notice564/95
Toys and Children's Products Safety (Safety Standards) Notice565/95
Official Languages (Authentic Chinese Text) (Road Tunnels (Government) Ordinance) Order(C) 118/95
Official Languages (Authentic Chinese Text) (Tate's Cairn Tunnel Ordinance) Order (C) 119/95

Sessional Papers 1995-96

No. 37─The Prince Philip Dental Hospital Hong Kong Report by the Board of Governors for the period 1 April 1994 - 31 March 1995
No. 38─Ocean Park Corporation Annual Report 1994-95
No. 39─Emergency Relief Fund Annual Report by the Trustee for the year ending on 31 March 1995
No. 40─ Social Work Training Fund Thirty-fourth Annual Report by the Trustee for the year ending on 31 March 1995
No. 41─ Chinese Temples Fund Income and Expenditure Account with Balance Sheet and Certificate of the Director of Audit for the year ended 31 March 1995
No. 42─ General Chinese Charities Fund Income and Expenditure Account with Balance Sheet and Certificate of the Director of Audit for the year ended 31 March 1995
No. 43─ Report of the Brewin Trust Fund Committee on the Administration of the Fund for the year ended 30 June 1995
No. 44─ Grantham Scholarships Fund Income and Expenditure Account with Balance Sheet and Certificate of the Director of Audit for the year ended 31 August 1995
No. 45─ Queen Elizabeth Foundation for the Mentally Handicapped Report and Accounts 1994-95
No. 46─ The Accounts of the Lotteries Fund 1994-95
No. 47─ Hong Kong Housing Authority 1994-95 Annual Report
No. 48─ Hong Kong Housing Authority Annual Accounts for the year ended 31 March 1995 and Balance Sheet as at that date

ORAL ANSWERS TO QUESTIONS

Mother Tongue as Medium of Instruction in Secondary Schools

1.MR IP KWOK-HIMasked (in Cantonese): Mr President, according to the findings of a research conducted by the Education Department, it is more appropriate for about 70% of Form One students to receive education in their mother tongue, but there are only 100 secondary schools (accounting for less than 20% of all the secondary schools in the territory) which have adopted the mother tongue as the medium of teaching. In this connection, will the Government inform this Council:

  1. whether it has promoted the importance of mother-tongue teaching to parents of secondary school students; if so, what are the details, and what achievement it has made in this regard; and
  2. what plans does the Government have to make more schools accept and adopt mother tongue teaching?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, the Government's policy is to encourage secondary schools to adopt Chinese as the medium of instruction, to allow individual schools to exercise discretion in the choice of their medium of instruction after taking into consideration whether their students can learn effectively in Chinese or English, and to strongly discourage the use of mixed code in schools. This policy is based on the following considerations:

  1. that teaching and learning are generally more effective through the mother tongue; and
  2. that while students can learn more effectively in their mother tongue, those who have the ability to learn effectively in English should be given the opportunity to do so if they so wish.

Since 1994, parents of Primary six students have been provided with information on their children's language ability in Chinese and English. Schools have since been categorized into three groups as follows:

  1. schools which should use Chinese as the medium of instruction;
  2. schools which may use either Chinese or English as the medium of instruction; and
  3. schools which may use Chinese or English for some classes and should use Chinese only for other classes as the medium of instruction.

At the same time, the Education Department has been vigorously promoting the benefits of mother tongue teaching by:

  1. publicizing the results of research studies undertaken by the Education Department in conjunction with the University of Hong Kong and the Chinese University of Hong Kong between 1987 and 1994 on using the mother tongue as the medium of instruction. These studies indicated that students generally learned and performed better with their mother tongue adopted as the medium of instruction, particularly in language-loaded subjects. Abstracts of these results have been distributed to all kindergartens, and primary and secondary schools. The Education Department has also produced video tapes on the basis of the information concerned. Starting from 1995, such information is also given, in the form of pamphlets, to all parents of Primary six students who will have to choose a secondary school for their children;
  2. producing posters for schools to display on parents' days;
  3. holding roving exhibitions to explain the Government's policy on medium of instruction and the findings of the relevant research studies; and
  4. organizing seminars for secondary school headmasters on how to effectively implement mother tongue teaching.

As a result of these efforts, the number of schools adopting Chinese as the medium of instruction for all subjects except English has increased from 52 in 1994 to 69 this year. In fact, some 280 secondary schools or 70% of all the secondary schools use Chinese as the medium of instruction to varying degrees. Of these, some 150 schools use Chinese for most of the subjects.

To encourage more schools to use Chinese as the medium of instruction in the coming years, the Education Department will continue to adopt preferential measures which include -

  1. providing additional teachers of English, movable partitions, wirefree induction loop systems as well as one-off library grants to enhance English teaching and learning;
  2. providing training courses to prepare teachers to teach in Chinese;
  3. providing incentives for publishers to produce good quality Chinese textbooks in various subjects ─ the Finance Committee of this Council has recently approved $54 million for implementing phase four of the incentive scheme; and
  4. compiling glossaries of technical terms in both Chinese and English for major subjects.

In addition, the Education Department is currently conducting a three-year longitudinal study starting in 1994 to gauge the effects of different modes of medium of instruction on the academic achievement and learning process of Form One to Form Three students. Based on these findings, we will formulate and issue to schools clear-cut guidelines in 1997 on the appropriate medium of instruction to be adopted from September 1998 onwards.

These efforts will be reinforced by the following publicity activities to be launched by the Department in this fiscal year of 1995-96:

  1. To organize eight seminars on the benefits of mother tongue teaching for primary school teachers in the hope that they will pass the message on to pupils and parents;
  2. To produce television programmes and Announcements of Public Interest (API) on radio, targeting specially on parents;
  3. To put up posters at MTR stations;
  4. To prepare and distribute new pamphlets to parents of Primary Four to Primary Six students; and
  5. To publicize, through the mass media, successful examples of schools adopting mother-tongue teaching, particularly the outstanding achievements of their students with a view to promote mother-tongue teaching.

The total cost of these activities is estimated at $2.6 million.

MR IP KWOK-HIM (in Cantonese): Mr President, I would like to know more about the three-year longitudinal study which commenced in 1994 that the Secretary for Education and Manpower has mentioned earlier. He said that this study sought to assess different modes of medium of instruction. I would very much like to know clearly the content of this study. Can the Secretary provide more detailed information? What specific measures can the Administration take subsequent to the completion of the study to render mother-tongue teaching more acceptable to parents?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, this study which began in 1994 and which has mainly used 60 schools as samples, seeks to examine the progress of learning of students from Form One to Form Three who are taught in different modes of medium of instruction. The main purpose of this is that we would very much like to see the findings of this study match our previous studies, thus proving that the academic achievements of students learning through their mother tongue in this period (from Form One to Form Three) are better than students being taught under the so-called mixed code teaching approach. We will subsequently implement the guidelines which have already been issued to schools on the basis of the findings. Under the guidelines which we have issued to schools, as I have explained in the main reply, it is stated that some schools should use Chinese as the medium of instruction, some may use either Chinese or English while some should use Chinese only for some classes and use English or Chinese for other classes for better results. We very much hope that the findings of the study will further boost the confidence of schools and particularly parents in the effectiveness of mother-tongue teaching so that we can issue in 1997 a set of clear-cut guidelines as I have mentioned in the main reply, advising all schools to observe the guidelines of the Education Department and formally implement the policy of mother-tongue teaching across the board from the 1998 school year onwards.

PRESIDENT: I have four more names on my list and I draw a line there.

MR CHEUNG MAN-KWONG (in Cantonese): Mr President, it is mentioned in the main reply that the Government plans to issue a clear-cut guideline in 1998 to schools which are suitable only for mother-tongue teaching, asking these schools to adopt mother-tongue teaching for the benefits of their students. Can the Government inform this Council whether this clear-cut guideline is binding or is it just a "toothless tiger"? If these schools do not comply with this guideline of the Education Department, what measures will the Government take to ensure compliance?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, the guidelines will be issued in 1997, which is, in other words, two years away. We very much hope that in the next two years, through the series of measures and promotional campaigns that I have discussed in the main reply, an increasing number of schools will follow our guidelines by adopting the kind of language that we suggest to them as the medium of instruction. In consideration of the point that the Honourable CHEUNG Man-kwong raised just now, I will look into the need to draw up certain rules when the guidelines are issued in 1997. Of course, I can say that where secondary schools in Hong Kong are concerned, public secondary schools in particular, some of them are government schools and some are subsidized by the public fund. If we need to make the guidelines binding in implementation, even though the guidelines are not legally binding, there will certainly be other alternatives that we can consider to achieve this end. However, I do not wish to make a decision now regarding to what extent the guidelines are binding because I very much hope that through our on-going efforts, more and more schools will accept the guidelines that we have already issued to them.

MR LEUNG YIU-CHUNG (in Cantonese): Mr President, I would like to follow up part (b) of the question. At present, secondary schools or secondary school teachers have found it rather difficult to accept mother-tongue teaching. The reason for that, I believe, relates to the medium of instruction at our universities because at present, as the Secretary for Education and Manpower has mentioned, it is not compulsory for our universities to adopt a particular kind of language as their medium of instruction. This has puzzled secondary school teachers who are at a loss as to how the medium of instruction used in secondary schools can be linked up to that used at our universities. There are difficulties in the convergence of the medium of instruction particularly in subjects such as science, mathematics or natural science. May I ask the Secretary this: while secondary school teachers and secondary schools are being talked into adopting mother-tongue teaching in their schools, how can the Administration convince them that the difficulties faced by their students in respect of the medium of instruction used at our universities will be eliminated?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, from what I understand as the main point of Mr LEUNG's question, he is, perhaps, worried that students who study in Chinese-medium secondary schools may face certain difficulties when they go to university. I, however, do not quite agree with him. It is because basically, we have conducted a lot of studies and we have been telling parents since 1994 that in actual fact, some 33% of students in the territory can learn through either Chinese or English while a majority of the rest of the students should learn through their mother tongue, namely Chinese, in secondary schools. For students who learn through Chinese, I think they would not have problems in other disciplines when they study at university because there are such reference books as bilingual glossaries of technical terms. I have to stress that the mother-tongue teaching approach that I have presented just now does not mean that the subject of English must also be taught in Chinese. The subject of English can be taught in English. Therefore, the point I am making is that learning through the mother tongue does not necessarily mean a lowering of the English standard. Besides, as I have mentioned in the main reply, the Government will provide plenty of support to Chinese-medium schools, which includes additional teachers of English.

MRS SELINA CHOW (in Cantonese): Mr President, as the Secretary for Education and Manpower has mentioned just now that while suggestions have been made to schools, very few schools seem to have adopted mother-tongue teaching of their own accord. There are a mere 69 schools which have adopted such approach so far while 70% of the schools have not yet accepted this approach. While that clear-cut guideline is to be issued only in 1998, can it be put across to schools earlier, telling them that this policy will definitely be implemented in 1998 so that they can make a choice earlier and actively change their language policy?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, as a matter of fact, all secondary schools know well and have received from the Education Department instructions as to which language, be it Chinese or English, should be adopted as the medium of instruction. Therefore, all schools are already aware of the guidelines. But why do we have to issue a set of guidelines in more explicit terms in 1997? As I have stated in the main reply, it is because a three-year longitudinal study was launched in 1994, seeking to collect data that are objective and which should be more convincing to both schools and parents to prove that learning through the mother tongue is effective indeed. Given that the study which started in 1994 will take three years, we can only have the findings in 1997. Such being the case, I hope to issue the clear-cut guidelines only in 1997 to dovetail with the findings of this three-year study. Yet, it does not mean that we are going to stop the measures in the interim. We will, as I have mentioned in the main reply, continue with the promotional and supportive measures concerned in order to encourage more schools to observe our guidelines.

MR ANTHONY CHEUNG (in Cantonese): Mr President, although the Secretary for Education and Manpower has mentioned in his reply just now that some research studies showed that students who are taught in their mother tongue have demonstrated better performance in learning and that the Government has provided additional resources to support mother-tongue teaching in schools, the reality is that a great majority of secondary schools are reluctant to fully adopt the mother tongue as the medium of instruction. What are the reasons for this? Is it due to resistance from parents who are reluctant to let their children learn in their mother tongue? Are they worried that their children may face difficulties when they go to university; or is it because of reservations on the part of employers? Has the Government formulated any plans before, or does it have any at present, to conduct substantial studies in an effort to solicit the opinions of the community, including those of employers, universities or parents on mother-tongue teaching?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, the question raised by Mr CHEUNG consists of several parts. First, he asked why many schools remain unwilling to observe the guidelines of the Education Department and adopt mother-tongue teaching. This is due to a number of reasons. Of course, on the one hand it is because of the attitude of parents, many of whom tend to feel that English-medium teaching will help improve their children's proficiency in English and this will be advantageous to their children in further studies and in seeking future employment. Another reason, which correlates with the above, is that some schools believe that if they switch from English-medium to Chinese-medium teaching, they might end up having to accept students with a lower academic standard owing to the attitude of parents in choosing schools for their children.

As to how we are going to allay their anxieties, first of all, as I have mentioned in the main reply, we will on the one hand publicize the effectiveness of mother-tongue teaching through promotional campaigns and on the other hand, as we have already mentioned, there is the three-year longitudinal study. We hope that more convincing and objective information will be obtained to prove the effectiveness of mother-tongue teaching. In the meantime, I also have to emphasize that we will continue to convey the message to parents that mother-tongue teaching will not in the least lower the students' English standard because the lowering of English standard may be due to a diversity of factors. Moreover, despite mother-tongue teaching, the subject of English can still be taught through the medium of English. In this connection, we will reinforce this message to parents.

Hospital Authority Merit Payments to Senior Staff

2. MR CHAN WING-CHANasked (in Cantonese): Mr President, will the Government inform this Council:

  1. whether merit payments are granted to senior executives of the Hospital Authority; if so, what are the criteria for granting such payments, which types of executives are eligible for receiving such payments, and what is the basis for determining the amount granted; and
  2. of the annual amount appropriated for such payments by the Hospital Authority over the past three years?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, the Chief Executive and Hospital Chief Executives are senior executives of the Hospital Authority whose remuneration contains a performance related element. Such payments are determined by assessment panels set up to evaluate the overall performance of individual executives in discharging their management duties and achieving agreed service targets.

In the case of Hospital Chief Executives, the assessment panel comprises members of the Hospital Authority Board as well as the respective Hospital Governing Committees, and the payment ranges from 0% to 15% of pay. In the case of the Chief Executive, the assessment panel comprises Hospital Authority Board members, and the payment ranges from 0% to 30% of pay.

The amounts of performance related payments granted by the Hospital Authority in 1992-93, 1993-94 and 1994-95 were in the order of $0.6 million, $4 million and $7 million respectively.

MR CHAN WING-CHAN (in Cantonese): May I ask the Government if it is appropriate to set up this merit payment scheme for the Hospital Authority? If the Government considers this merit payment scheme appropriate, why is it that only a small handful of people in the higher echelons are eligible for this payment? Does the Hospital Authority think that other than this small handful of people, the efforts of other members of staff are not worthy of commendation and reward?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, this merit payment seeks to provide a mechanism to ensure that the performance of senior executives is up to a certain standard. In this connection, it is necessary to establish an administrative framework and set certain targets. This is a scheme drawn up by the Hospital Authority with the approval of the Government. Under the circumstances, it is an internal administrative decision of the Hospital Authority that such payment is made to senior executives and not to be granted to other members of staff.

PRESIDENT: I have four more names on my list and I draw a line there. May I again remind Members to keep their supplementary single-barrelled and keep the preambles very, very short indeed.

MR CHAN KAM-LAM (in Cantonese): Mr President, at present, a great majority of the Government's appropriation to the Hospital Authority and the main revenue of hospitals is spent on expenses relating to manpower and staffing matters. Under this system, how can the Government prevent individual executives who seek to procure a higher merit payment from deliberately suppressing departmental expenditures so that the money will go into the pockets of these executives?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, the performance related payment is meant to reward those members of staff who can meet the targets of improving the services. This payment is drawn from the money set aside for remuneration at a designated rate. Therefore, no extra expenses will be incurred. Nor will it have any impact on the expenditure required for the provision of services to patients. The Hospital Authority has a mechanism in place to determine the eligibility of their staff for this merit payment. As I said in the main reply, in the case of the Chief Executive, an assessment panel under the Hospital Authority Board is set up and in the case of Hospital Chief Executives, a panel comprising members of the Hospital Authority Board and the respective Hospital Governing Committees is set up to assess their eligibility. Therefore, I believe there is adequate information provided for the assessment and this payment will not jeopardize the services to patients.

MISS CHAN YUEN-HAN (in Cantonese): Mr President, I am not challenging the management system of the Hospital Authority. However, the fact is that rumours are spreading in the community. From the figures just presented to us by the Government, the granting of this payment alone in 1994-95 already amounted to $7 million. If we calculate on the basis of the data that the Government has provided us earlier which indicate that there are 40 executives in the senior management level, 40 people sharing this $7 million will mean over $170,000 for each person. Given that the Hospital Authority is a non-profit-making institution, does the Government consider this merit payment scheme appropriate? I have to stress that at a time particularly when we are discussing inadequate expenditure on medical services, is it a right thing to do to adopt such a scheme?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, I think what the Honourable Miss CHAN Yuen-han has said may just be her personal opinion. But I can explain to Members that this payment has increased annually on a progressive basis because the newly introduced administrative framework is only implemented gradually. It was not commenced in full in 1992. It was only in 1994-95 that all Hospital Chief Executives required were recruited and this explains the annual increase in the payment. As for the question of appropriateness and whether this payment should be granted, the Hospital Authority can make its own decisions on the remuneration for their staff.

DR LEONG CHE-HUNG (in Cantonese): The Secretary for Health and Welfare revealed in her reply just now that the annual amount of merit payment is on the rise progressively. Does this mean that there are more and more senior executives, or that the executives are doing their jobs better and better?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): I have in fact answered half of the question. First, there has been an increase in the number of executives between 1992 and 1995. Secondly, the executives have more opportunities each year to show good performance. Thirdly, I have to point out that not all the executives will definitely be granted this payment.

MR CHOY KAN-PUI (in Cantonese): Mr President, is the morale of staff in the lower ranks affected by the merit payment and bonus scheme for senior executives of the Hospital Authority? How will the administration and operation of the Hospital Authority be affected without this scheme? In view of the concept of linking up charges with the cost, will patients be made to pay higher medical fees as a result of a rise in the cost due to this bonus system?

PRESIDENT: I think there were three questions.

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, first of all, I have to stress that the payment is not a bonus. It is a payment determined by performance and it is clearly set out in the letters of appointment that such payment is granted only on the ground of good performance. It is part of the income, not a bonus, and the Hospital Authority is, as Members have pointed out just now, a non-profit-making institution. As to the question of whether there is any impact on the morale of other members of staff, as far as I know and from the information provided to me by the Hospital Authority, the morale is not affected. The granting of this payment and the charges for medical services are two entirely different matters, which are not in the least related.

Chief Executive (Designate) and Team Designate 3.

MR LEE WING-TAT asked (in Cantonese): Mr President, as the Chief Executive (Designate) and Principal Officials (Designate) the Team Designate will be appointed in 1996, will the Government inform this Council:

  1. what is the composition of the Team Designate as the Government understands it;
  2. whether, in regard to providing assistance to the Special Administrative Region (SAR) Government (Designate) in its work during the transition, the Government will provide assistance to the Principal Officials (Designate), Executive Councillors (Designate) or the Team Designate as a whole in addition to providing assistance to the SAR Chief Executive (Designate);
  3. in what ways will such assistance be given; and
  4. whether the Government will urge the British Government to request the Chinese Government to state clearly that the secretariat consisting of a few hundred staff proposed to be set up by a member of the Preliminary Working Committee (PWC) to provide assistance to the Chief Executive (Designate) will not result in the existence of a "shadow government", and whether the Government will request the British Government to clarify if the PWC's proposal contravenes Section four of the Sino-British Joint Declaration?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, it is not for the Hong Kong Government to define for the Chinese side what the term "Team Designate" stands for. The only occasion that this term had been explained to us was in the context of discussions on the Court of Final Appeal. On that occasion, the Chinese side told us that the Team Designate would be led by the Chief Executive (Designate) and would include the Principal Officials (Designate) and others qualified to take part in the establishment of the Court of Final Appeal.

It is obviously in Hong Kong's interests to ensure that the transition will be as smooth as possible. It is, therefore, essential that we render assistance to the Chief Executive (Designate). In the Governor's policy address, we have already undertaken to do so. The details and the form of such assistance will need to be discussed with the Chinese side.

Under the Joint Declaration, the administration of Hong Kong before 1997 will remain a British responsibility. We have made it clear that we will maintain effective administration of the territory and will not accept any parallel or shadow government. We have noted from recent press reports that the Chinese side have affirmed their support for this principle and that there should not be an alternative centre of power before 30 June 1997.

MR LEE WING-TAT (in Cantonese): By this time next year, there will be many organizations relating to the transition of the Hong Kong Government emerging, including the Preparatory Committee. The Chief Executive (Designate) will be known; and the Executive Councillors (Designate) and Principal Officials (Designate) after 1997 may be appointed in parallel with the existing Administration. How can the Secretary for Constitutional Affairs assure us that the discussions of these many organizations and the views they openly express will not interfere with the operation of the Hong Kong Government and will not affect the effectiveness and the authority of the existing Government in governing Hong Kong, as consistently emphasized by the Chief Secretary?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, I would like to reiterate and stress again the provision in the Joint Declaration. It provides very specifically and very clearly that the administration of this place would be the responsibility of the British Government before 1 July 1997. So there is no question of us abdicating; there is no question of us being confused or confounded by discussions or happenings elsewhere. We would continue to maintain a very effective administration of this place before l July 1997.

PRESIDENT: I have four more names on my list, and I will draw a line there.

DR YEUNG SUM (in Cantonese): Mr President, since the Government will establish a liaison office to maintain co-operation with the Team Designate, can the Government inform this Council how such liaison office will report to Members of the Legislative Council? Will it consult Members before any important decision is made?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, as I have explained to Members of the Constitutional Affairs Panel on a number of occasions and as the Governor has indeed also explained in his previous Question and Answer session, our assistance to the Preparatory Committee and in future the Chief Executive (Designate) will be on the principle of openness and transparency and we certainly would keep the Legislative Council fully in the picture of the Hong Kong Government's activities in relation to co-operating with the Preparatory Committee. Of course, it is not the Hong Kong Government's responsibility to explain on behalf of the Preparatory Committee what it does, how it operates and why it operates in a particular fashion. But insofar as the Hong Kong Government's co-operation with the Preparatory Committee is concerned, we would certainly keep Legislative Council Members and the community at large generally informed of our activities. And I would like to also remind Members that our co-operation with the Team Designate, the Preparatory Committee and the Chief Executive (Designate) will be on the three important principles. Firstly, we would not do anything that would be against the Joint Declaration and the Basic Law. We would not do anything that would compromise the Hong Kong Government's commitment to governing this place effectively before 1 July 1997, and we certainly would not do anything that would put civil servants into a position of double or conflicting loyalties.

PRESIDENT: Are you claiming your question has not been answered, Dr YEUNG?

DR YEUNG SUM (in Cantonese): Yes, I am, Mr President. It is because I have also asked the Secretary whether Members of the Legislative Council will be consulted before any important decision is made.

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, I do not quite understand what Dr YEUNG means by "before any important decision is made". Certainly, any decision made by the Preparatory Committee is not a responsibility of the Hong Kong Government. But insofar as how we co-operate, how we help the Preparatory Committee, we have made a commitment that we will certainly keep the community at large, including the Legislative Council, informed of developments. So there is no question of us making a decision on a particular subject. The general mode of co-operation, the general method of co-operation, the general system of co-operation obviously is something that we would let the Council and community know about, and our activities would be fully transparent and fully open. So it is not a question of us doing anything secretly.

MR CHIM PUI-CHUNG (in Cantonese): Mr President, under the existing system of the British Government, the ruling Conservative Party invariably forms its cabinet. The opposition party, namely the Labour Party, also has its shadow cabinet. This should be particularly the case for Hong Kong, which is now in a transition period in the run-up to 1997. In this connection, does the Government consider the establishment of a shadow government or cabinet reasonable and necessary so long as these organizations do not influence the operation of the existing Hong Kong Government?

PRESIDENT: Mr CHIM, are you seeking an opinion from the Secretary, or are you asking for the Government's position on the existence of a Preparatory Committee?

MR CHIM PUI-CHUNG (in Cantonese): Mr President, I raised this question mainly because of the strong resistance of the Government to a shadow cabinet or government. But if these organizations do not affect the operation of the Government, it should be unnecessary to put up any resistance to them. So what is the attitude of the Government towards a shadow government or cabinet which does not affect the operation of the Government?

PRESIDENT: Are you prepared to rephrase your question along my lines?

MR CHIM PUI-CHUNG (in Cantonese): Mr President, most importantly, ......

PRESIDENT: Mr CHIM, you have to rephrase your question.

MR CHIM PUI-CHUNG (in Cantonese): All right, Mr President. Let me re-organize my question. I am saying that ......

PRESIDENT: I am sorry, you have stated your view twice. You are not asking a question, you are seeking Mr NG's personal view on a term called "shadow government".

MR CHIM PUI-CHUNG (in Cantonese): Mr President, my question is this. The Secretary for Constitutional Affairs stated in paragraph three of his reply that the existence of a shadow government will not be accepted. If the so-called shadow government does not affect the operation of the Government, how will the Government deal with this issue? I would not mind if you rule that it is inappropriate for the Secretary to answer this question.

PRESIDENT: Secretary, the Government position, not your personal view please.

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, with your tolerance, I will try to answer the points raised by Mr CHIM.

We have obviously undertaken to provide the Chief Executive (Designate) with the necessary assistance to help him to prepare for the formation of the SAR Government, but the thing to remember is that prior to 1 July 1997, the administration of this place rests in the hands of the Hong Kong Government, through the British Government's responsibility and therefore any planning or preparation by the Chief Executive (Designate) and his supporting team should not undermine the authority of the current Administration and we just fail to see how the question of shadow government comes into the debate. We would be responsible for running this place before 1 July 1997, and indeed Mr CHIM should note, as mentioned in my principal answer, that the Chinese senior officials, and only last week, at least two or three of them, have recently clearly indicated that there would not be any question of a second power centre or a shadow government existing in Hong Kong before 1 July 1997.

MISS EMILY LAU (in Cantonese): Mr President, the Government said in the reply that the details and the form of assistance to be rendered to the Team Designate will need to be discussed with the Chinese side. However, neither do I believe nor accept that the Government, at this point in time, does not have any initial proposal in this regard. I have already put this question to the Chief Secretary when she was here last week. It is my hope that the Government can reveal more information to Members today. As the Government has frequently stressed the high transparency in the future operation of the Government, but if the Government refuses to tell the people of Hong Kong anything right from the start, I think nobody would believe that the Government would, in actual reality, let us know more. Therefore, Mr President, I hope that the Government can tell us right away how does the Government plan to deal with the Chinese Government and what sort of questions will be raised for discussion in an effort to provide assistance?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, I am really surprised to hear Miss LAU saying that we have not said anything about how we are going to help or co-operate with the Preparatory Committee. I will leave the Chief Executive (Designate) for the moment because obviously the Chief Executive (Designate) would have at least another year to go, or at least a long while to go before we would need to face that scenario. But insofar as co-operating with the Preparatory Committee is concerned, if Miss LAU would care to refer to the 1995 Governor's policy address, paragraphs 133 to 137, we did set out the broad framework of how we were to co-operate. We suggested that we would establish a liaison office as a focal point of contact within the Hong Kong Government, as a focal point of liaison, as a focal point of provision of information to the Preparatory Committee. Now the actual size of the liaison office and the actual detailed operation as to how many meetings we hold, are obviously some of the details that we would need to discuss and would need to unfold depending on how the Preparatory Committee would operate in detail or in actual reality. But the framework is clearly set out and the principles of that co-operation are again very clearly set out in the 1995 policy address. With those principles and within that framework, we will be able to co-operate in an effective way with the Preparatory Committee and I can assure Miss LAU that if there are major departures from that framework, from those principles, the Legislative Council will be the first organization to hear about them.

MR HOWARD YOUNG: Mr President, the Secretary for Constitutional Affairs refers in his second paragraph that the details and form of such assistance will need to be discussed with the Chinese side. I would like to know whether this is inferring that the Government plans to have the details and anything to do with assistance only discussed with the Chinese side, which I take it to mean through diplomatic channels, or will it be feasible also that once the Chief Executive (Designate) is known, then surely he should be able to directly discuss with the Hong Kong Government rather than him having to talk to Beijing, Beijing to talk to London, London to talk to Hong Kong, in a very roundabout way? Could the Secretary please clarify this point?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, we certainly do not close our mind to any possible avenues of communication with the Chinese side, on any matter affecting the transition, including of course, how we co-operate with the Preparatory Committee and the Chief Executive (Designate). Mr YOUNG is quite right in pointing out that apart from the established diplomatic channels, there are other opportunities, there are other occasions, there are other well-established avenues where we can communicate with the Chinese side, and as for his reference to when the Chief Executive (Designate) is around, that will be another avenue for us to communicate directly and more conveniently in dealing with the Chinese. It is obviously something we would bear in mind.

PRESIDENT: I will allow one more supplementary as I had overlooked the fact that Mr CHAN Kam-lam had pressed the request to speak button much earlier on.

MR CHAN KAM-LAM (in Cantonese): Mr President, the Secretary for Constitutional Affairs stated in his main reply that it is obviously in Hong Kong's interests to ensure that the transition will be as smooth as possible and it is, therefore, essential that we render assistance to the Chief Executive (Designate). Given that the officials (designate) will be appointed in 1996, may I ask the Government if it should provide the Chinese Government with information of our government officials as soon as practicable so that the Chinese side and the Chief Executive (Designate) will be able to start the work relating to the appointment of officials?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, obviously we would provide any information that is necessary or useful to help the Chief Executive (Designate) in the establishment of a new government. But I would not like, at this stage, to speculate as to what exactly would be the type of information that would be required by the Chief Executive (Designate). Our general commitment is to help him as far as we can, but against the three principles, the three broad principles that we have set out. So we would not do anything that would be against any of the three principles.

First-time Home Ownership

4.MR ERIC LI asked (in Cantonese): Since June 1994, the Government has implemented administrative measures to regulate property transactions and a curb property prices in order to enable families in need of a home to have the opportunity to purchase homes for the first time at relatively reasonable prices. In this connection, will the Government inform this Council:

  1. of the number of new residential flats completed between June 1994 and October this year;
  2. what is the number of flats for which transactions have been concluded during the above-mentioned period; whether there is information to show how many of the transactions are in respect of flats purchased by first-time home-buyers; and what is the average vacancy rate during the period in question; and
  3. whether the number of first-time home-buyers and the number of new residential flats referred to in the above-mentioned period have shown an increase when compared with the corresponding figures in each of the three years immediately before the implementation of the measures to regulate property transactions; if not, what are the reasons?

SECRETARY FOR HOUSING (in Cantonese): Mr President, since the introduction of the anti-speculation measures in June 1994,

  1. the number of new residential flats completed up to October 1995 is 76 107 units, including all private and public housing flats;
  2. the number of transactions concluded during the same period is 128 738. No separate statistics are kept on the number of transactions involving first-time home-buyers. The vacancy rate for private domestic flats, which is compiled on an annual basis, was 4.7% in 1994;
  3. the number of new residential flats competed has increased by 4%, 8% and 23% when compared with those in the past three years respectively immediately before the introduction of the new measures.

MR ERIC LI (in Cantonese): Mr President, I think my question is clear enough. It is about the supply of private housing units and their transactions. However, I am disappointed that the reply is incongruous with the question in that it has mixed up the issue with public housing. I am still unable to get a full picture of the outcome reflected by the measures taken. First of all, I hope the Administration would supply us with correct information so that the public may not be misled. The second point, though less obvious, is whether these measures have enabled families in need of a home to purchase homes for the first time. I am sure that such information is what we in this Council want to know. It has now become obvious that these measures have not only lowered the prices of private properties but also reduced their speculation activities. At the same time, the supply of medium-and long-term housing has also decreased. There are less and less suitable private residential flats to attract purchasers, resulting in the presence of many "flats without occupancy". Now, 17 months after the introduction of these measures, the Administration has the audacity to tell us that it still does not know whether or not these measures have enabled those in need of a home to purchase their own homes.

PRESIDENT: What is your question, Mr LI?

MR ERIC LI (in Cantonese): The Administration is even unable to supply us with statistics. Will the Administration assure us when it will carry out a review of the misguided policies so as to let us know, firstly, whether it will increase the supply of medium- and long-term private housing, not just land supply (unless it is the intention of the Administration that the people should sleep on streets) and secondly, whether it can supply us with correct figures to show if families in need of a home have the opportunity to purchase their own homes?

SECRETARY FOR HOUSING (in Cantonese): Mr President, the Honourable Eric LI has accused me of giving him a confused reply, but I have replied in accordance with the question asked. With your permission, I would like to provide additional information about private property transactions of the past three years or so. The numbers of transactions of private properties were 86 219 in 1992-93, 111 108 in 1993-94 and 111 832 in 1994-95.

As to providing middle-income families with the opportunity to purchase their own homes, I think the SECRETARY FOR HOUSING has on a number of occasions pointed out that there are at present various programmes to help such families to purchase their own homes. In fact, Members have already been provided with so much information on public housing that they may probably not want to hear any more about it. As to private housing, we are of the opinion that there should be enough supply of land to encourage more residential flats to be built. The Government now envisages that 195 000 private residential flats will be built by 2001, hoping that this will help families in need of a home to purchase their own homes. As to programmes to encourage families to purchase their own homes, the Government has, as you all know, gone a long way towards helping the sandwiched class, that is, the middle-income families to achieve this goal. We hope to build at least some of the residential flats for them to purchase. With the increase in the number of public and private housing units during the next few years, I am sure that families wishing to purchase their own homes will have the opportunity to do so.

PRESIDENT: Mr LI, I have to allow time for other Members. I will have to draw a line there.

MR ERIC LI (in Cantonese): Mr President, the Secretary has failed to answer my question which is very simple. We all know that the Housing Branch has many programmes on hand, but what I have asked is: When will the Administration really have a review of the relevant policies carried out? The Administration has never mentioned this point. My second point is about figures. When on earth will the Administration provide us with the figures required? These are the two major points which the Secretary has failed to respond to.

SECRETARY FOR HOUSING (in Cantonese): Mr President, the review report has already been submitted to the Housing Branch. As the relevant figures are still under study, I am unable to provide you today with the exact figures required. Generally speaking, there should not be much difference between the figures of the review and the target figures set by the Government.

DR LAW CHEUNG-KWOK (in Cantonese): Mr President, many people are of the opinion that the slump in the second-hand property market is mainly due to the fact that the Administration has gone too far in interferring with the property market. What factors will the Administration consider in deciding whether or not to relax regulation of the property market?

SECRETARY FOR HOUSING (in Cantonese): Mr President, it would seem that the second-hand property market has somewhat revived during the last month, as can seen from newspaper reports. The programmes introduced by the Government last year have now achieved the expected results. As to private property transactions, we can all see that the market has begun to revive and therefore I think there is no need at the moment to interfere with it or to provide it with any assistance.

MR JAMES TIEN (in Cantonese): Mr President, will the Administration supply this Council with information to indicate how many private building plans have been approved this year, that is, in 1995? I ask this question because, based on the number of building plans approved this year, we can forecast how many buildings will actually be completed in three years. We can thus tell if the number of buildings completed will greatly decrease, as pointed out by the Honourable Eric LI.

SECRETARY FOR HOUSING (in Cantonese): I am sorry, Mr President. I do not have such information off hand, and so I cannot answer this question.

PRESIDENT: Could that figure be supplied in writing subsequently, Secretary?

SECRETARY FOR HOUSING: Yes, Mr President. (Annex I)

MR LEE WING-TAT (in Cantonese): Mr President, everybody knows that the most important way to regulate or to stabilize property prices is to have a steady supply of a large number of private properties. However, there are three unfavourable factors which have worried me a great deal. First, according to the information provided by the Rating and Valuation Department, the production of private properties in 1993 and 1994 was lower than expected. Secondly, there have been fewer redevelopment sites in urban areas. Thirdly, the record vacancy rate of 4.7% means that about 50 000 private domestic flats are vacant. Will the Secretary for Housing ascertain whether these three unfavourable factors will in the long run cause considerable obstruction to the target of providing sufficient private domestic flats for the public? If so, what are the solutions?

SECRETARY FOR HOUSING (in Cantonese): Mr President, the Government has set up a Housing Project Action Team to look into the matter of land supply. As long as the number of flat units exceeds 500, the Team will try its best to help the responsible organization, be it the Housing Authority, the Housing Society or even a private organization, to solve the problem of land supply, or take whatever action to co-operate with the organization concerned. The Team is chaired by the Secretary for Housing. As regards the vacancy rate of 4.7% which means about 50 000 housing units are vacant, I think the vacancy rate has remained at more or less the same level recently. There is no indication that this year's figure is particularly high or particularly low. It has remained at this level during the past few years.

PRESIDENT: Mr LEE, not fully answered?

MR LEE WING-TAT (in Cantonese): I would like to clarify one point. The Secretary for Housing has mentioned that during the past few years, the vacancy rate has remained at 4.7%, which means some 50 000 housing units are vacant. Will the Secretary for Housing inform us of the private housing vacancy rates of the years from 1991 till now? As far as I can remember, the lowest rate is 3.9% and the highest, 4.7%.

SECRETARY FOR HOUSING (in Cantonese): Perhaps I will provide a written reply. (Annex II)

Broadcasting Bill

5.MR ANDREW CHENG asked (in Cantonese): Mr President, the Government indicated to this Council on 2 November 1995 that it would seek the views of interested parties and consult the Chinese side on the Broadcasting Bill (the Bill). In this connection, will the Government inform this Council:

  1. how it will go about seeking such views; whether it will conduct public consultations on major issues arising from the Bill, such as the restrictions on "cross media ownership" and the regulation of "interactive multimedia services", and
  2. what progress has been made to date in its consultation with the Chinese side on the Bill; and what are the specific details of the consultation?

SECRETARY FOR RECREATION AND CULTURE (in Cantonese): Mr President, as drafting of the Bill is still underway, we have not yet decided precisely how the consultation should be conducted, and neither have we initiated consultations with the Chinese side. However, I can say that it is our intention that all interested parties will have an opportunity to comment on all matters in the Bill, and that all comments received will be considered carefully before the Bill is finalized for approval by this Council.

MR ANDREW CHENG (in Cantonese): The Government told this Council in the last Session that it would submit the Bill for deliberation by this Council. We, however, find it very disappointing that the Government did not honour its undertaking. Now the Government is saying again that it would table the Bill at this Council in this Session. Yet, the basic details of the consultation exercise have not been decided while the Chinese side still needs to be consulted. We all know that if the Chinese side is to be consulted on bills which are closely related to the freedom of speech ......

PRESIDENT: Please come to the question, Mr CHENG.

MR ANDREW CHENG (in Cantonese): ...... there will certainly be many people who wish to know more about the Bill. However, the Government has not started consulting the Chinese side and its reply to this Council was extraordinarily brief. For this reason, I deliberately speak at greater length to show my dissatisfaction. May I ask the Government how it can convince the public that the Government would proceed with the drafting of the Broadcasting Bill in this Session? If the Government is not going to proceed with this task, it should say so honestly and should not deceive us.

SECRETARY FOR RECREATION AND CULTURE (in Cantonese): The Honourable Andrew CHENG was disappointed because my reply was too brief. In fact, I painstakingly did so with good intentions. It is because Members have been spending more and more time on the question session so I hope my words can be succinct and to the point by saying only what is needed and leaving out things which are deemed redundant.

I absolutely disagree with Mr CHENG's allegation that we have been deceiving the Legislative Council or members of the public. Mr CHENG can criticize me for being incompetent, brainless or even mediocre. I can stand the most scathing criticizms of all sorts but I have never deceived anybody. We are making an on-going effort in drafting the Bill and we hope we could submit the Bill as early as possible for Member's deliberation.

MRS ELIZABETH WONG: Mr President, I think the Secretary has given a perfect answer to justify negativity and also prolonged delay. I do not think any other civil servant can emulate his perfection. I have heard previously of baking a chestnut cake. I think it is a hard nut to crack. We are still cracking the chestnut.

Will the Secretary inform this Council of the approximate timetable when he is likely to submit his Bill to this Council?

SECRETARY FOR RECREATION AND CULTURE (in Cantonese): Mr President, I am grateful to the Honourable Mrs Elizabeth WONG for thinking so highly of me. I think not many officials here can give a reply which is commended by Members as perfect and I think I deserve it. I can assure Members that it is definitely not a chestnut cake that is being taken out from the oven because chestnut cake would always be the last thing I choose to eat. In response to the question raised by Mrs Elizabeth WONG, I can only recapitulate that at present, the drafting of the Bill is still underway and we hope we could submit the Bill for Members' deliberation as early as possible. Besides, I can only reiterate, as the Acting Secretary for Recreation and Culture said in the written reply to a question on 2 November 1995, that it has always been the plan of the Government to submit the Bill for Members' deliberation in this Session. However, as to the question of when exactly the Bill will be tabled, it will depend on the progress of the drafting work and the time required for consultation with interested parties.

WRITTEN ANSWERS TO QUESTIONS

New Posts in the Political Adviser's Office

6.MISS EMILY LAU asked (in Chinese): It is learnt that three new posts have been created in the Office of the Political Adviser. In this connection, with the Government inform this Council

  1. of the reasons for the creation of these new posts;
  2. of the salary scale and area of responsibilities of each of the posts; and
  3. from which departments the officials presently holding these posts were transferred and what posts did they hold in the departments concerned?

CHIEF SECRETARY: Mr President, the Political Adviser's Office has recently been reorganized, on a trial basis, to bring together those functions of the Hong Kong Government which derive directly from the United Kingdom sovereignty and which will cease in June 1997 when the office will be wound up. This has involved the transfer of certain responsibilities and loan of posts from other Secretariat Branches. The answers to the specific questions are as follows:

  1. No new posts have been created on the establishment of the Political Adviser's Office. However as a result of the reorganization, there are now three additional officers designated as Deputy Political Advisers. Two of these posts are on loan from other Secretariat Branches; the third is an officer filling an existing post which has been retitled;
  2. All these officers are filling existing AOSGC posts at the D2 level. The Deputy Political Adviser (Security) post deals with certain security issues related to the United Kingdom sovereignty. The Deputy Political Adviser (General) post is responsible for contributing to the China advice function and supporting the Political Adviser as a member of the Joint Liaison Group;
  3. The Deputy Political Adviser (Security) is filling the post of Principal Assistant Secretary (Security) D currently on loan from Security Branch. The Deputy Political Adviser (Personnel) is holding the post of Principal Assistant Secretary (Civil Service) Development on loan from Civil Service Branch. The third post, Deputy Political Adviser (General) is an existing AOSGC directorate post in the Political Adviser's Office which has been retitled.

Educational Needs of New Immigrant Children

7. MR EDWARD HO asked (in Chinese): Since the middle of this year, the number of Chinese immigrants arriving daily in the territory for permanent residence has increased from 105 to 150 and many of these immigrants are school-age children. In this connection, will the Government inform this Council:

  1. whether, in the light of the increasing number of children (aged six to 12) from mainland China settling in the territory, the Education Department (ED) has made any assessment and co-ordination of their educational needs at various levels of schooling in the next five to 10 years; if so, what are the details of the assessment and co-ordination plan; if not, why not; and
  2. whether the ED has set up any task force to provide assistance and counselling to such children and their parents to cope with the difficulties the children may encounter in their studies?

SECRETARY FOR EDUCATION AND MANPOWER: Mr President,

  1. To meet the demand for primary school places from an increasing number of Chinese immigrant children who are aged between six and 12 over the next few years, we are committed to building five additional primary schools for completion in 1997-98. In the interim, we are making use of the existing vacancies in primary and secondary schools resultant from an overall decline in our school population to accommodate these children. We shall conduct a review of the longer-term requirements for school places at different levels, including secondary schools, as well as the various support services in 1996.
  2. There is close co-ordination among various sections in the Education Department in the provision of services to immigrant children and their parents. These services include school placement, tailor-made induction programme, remedial teaching, and guidance and counselling service.

On guidance and counselling, student guidance officers/student guidance teachers are stationed in primary schools to assist in:

  1. promoting pupils' positive behaviour, strengthening their motivation towards learning and enhancing their self-esteem;
  2. training on study or social skills so as to enable the pupils to cope with their learning, adjustment or behavioural problems; and
  3. providing individual guidance to help them deal with more complicated adjustment, social or family problems.

Regarding parents, the Education Department has provided subvention to 14 non-government organizations in the 1995-96 school year to run short adaptation courses for adult immigrants. The course contents include the technique to help them cope with the difficulties their children encounter in studies.

The Home Affairs Department has been tasked to monitor and assess the services provided for new arrivals from China to ease the process of integration, to identify groups who are specially at risk, and to recommend the most suitable approach for responding to the practical problems as they emerge.

Reconstruction of Roads in the New Territories

8. MR CHOY KAN-PUI asked (in Chinese): At present, there are still a number of roads in the New Territories which were constructed by the Government many years ago and which have all the time been managed by the Government. These roads, which include Fan Kam Road, the Yuen Long Section of Lam Kam Road and Kam Tin Road, can no longer meet the current standards for highways nor can they cater for the needs of the rapid developments in the New Territories. In view of this, will the Government inform this Council:

  1. of the total number of such roads in the New Territories at present, together with their names and locations; and
  2. whether the Government has formulated a timetable for the reconstruction of these roads to meet the current road standards so as to ensure the safety of road users; if so, what are the respective dates for the commencement and completion of the reconstruction work; if not, why not?

SECRETARY FOR TRANSPORT: Mr President, the road network in the New Territories has developed over the past 50 years. At the time individual roads were constructed, they all fully met the then prevailing standards. Higher standards have evolved over the years resulting in better and more modern roads. However, this does not mean that the other roads are either unsafe or of an unacceptable standard.

It is fully recognized that with the pace of development in the New Territories, some existing roads may not be able to cope with increased levels of traffic. These roads need to be improved. The Lam Kam Road (Yuen Long Section) and Kam Tin Road fall into this category.

The improvements currently proposed cover:

  1. the widening of Kam Tin Road in two stages from the existing single carriageway to dual-two carriageway. The first stage from Au Tau to Kam Tin will start in early 1998 and is scheduled for completion in early 2000. The second stage from Kam Tin to Lam Kam Road will start in 2002 and is scheduled for completion in 2005; and
  2. the widening of Lam Kam Road from Kam Tin Road to Kadoorie Farm from the existing single carriageway to possible dual-two carriageway. This is scheduled to start in 2002 for completion in 2005.

A reconstruction and maintenance programme for Fan Kam Road, Kam Sheung Road, Yuen Long Section of Castle Peak Road and Route Twisk is also in hand and will be completed over the next five years. Improvement measures will include the provision of proper footpaths and drainage.

As regards minor roads, traffic management measures are implemented to maintain safe and efficient movement of traffic. For example, where necessary, speed limits are imposed or certain categories of vehicles are prohibited.

We shall continue to upgrade the road network to keep pace with traffic demand.

Servicing "999" Calls

9. MRS SELINA CHOW asked (in Chinese): It was reported that a member of the public recently had dialed "999" to report a bank robbery but only to receive the recorded reply "the line is busy". In view of this, will the Government inform this Council:

  1. of the average number of police communication personnel responsible for answering "999" calls and the average number of calls they have to handle per shift at present, and how do these figures compare with the corresponding figures in each of the past three years;
  2. of the total number of calls made to "999" to report crime which received the recorded reply "the line is busy" this year;
  3. of the average time currently taken for a call to "999" to be answered by the staff manning the number, and how does this figure compare with those of the past three years?

SECRETARY FOR SECURITY: Mr President, the answers to the three parts of the question are as follows:

  1. There are 18 Police Communications Officers and three Senior Police Communications Officers manning the "999" Consoles per shift in the three Police Regional Command and Control Centres in Hong Kong Island, Kowloon and New Territories. The number of staff deployed for such duties is the same for the past three years. In the first 10 months of this year, each shift handles an average of 445 calls. The average figures for 1992, 1993 and 1994 are 328, 338 and 401 respectively.
  2. The pre-recorded bilingual broadcast message was introduced in September 1994. Our computer system does not capture statistics on the number of calls answered by the message. However, the pre-recorded message invariably asks the caller not to hang up in order that the call could be dealt with as soon as possible.
  3. While we do not have statistics on the average time taken to answer a "999" call in the past three years, the findings of a recent snap-shot survey conducted by the police show that on an average a "999" call is answered within six seconds. It is possible that a caller may need to wait longer than six seconds to get through when a major incident takes place. However, this does not affect the response time of the police because such cases are often reported by more than one caller. For example, in the case referred to in the question, the police received two other reports of the same case at the time of the bank robbery. It should be noted that the first police officer arrived at the scene six minutes from the receipt of the calls.

Implementation of Matrimonial Causes (Amendment) Ordinance 1995

10. MRS MIRIAM LAU asked: The Matrimonial Causes (Amendment) Ordinance 1995 was passed by this Council on 17 May 1995 but it shall come into operation on a day to be appointed by the Secretary for Home Affairs by notice in the Gazette. Will the Government inform this Council of the reasons why, after a lapse of six months since its passage, the Ordinance has still not come into operation; and when it is expected that a notice will be published in the Gazette to bring the Ordinance into operation?

SECRETARY FOR HOME AFFAIRS: Mr President, I share the Honourable Member's wish for the Matrimonial Causes (Amendment) Ordinance (the Amendment Ordinance) to be brought into operation as soon as possible. However, before this can be done, it is necessary for the Matrimonial Causes Rules (the Rules) to be amended to bring court procedures in relation to matrimonial proceedings in line with its provisions. Amendments to the Rules are made by the Chief Justice. The Home Affairs Branch has been co-ordinating the preparation of the necessary amendments to the Rules. The relevant professional bodies are currently being consulted on an advanced draft. We expect to be able to finalize the amendments to the Rules and submit them to the Chief Justice for consideration within the next few weeks.

The Amendment Ordinance will be brought into force at the same time the amendments to the Rules to be made by the Chief Justice come into effect.

Misleading Advertisements

11. MR SIN CHUNG-KAI asked (in Chinese): As certain advertisements broadcast on television and radio, or carried in newspapers and magazines, contain incorrect or exaggerated information which mislead the consumers, will the Government inform this Council:

  1. which government department is responsible for dealing with complaints about advertisements containing incorrect information and how such complaints are handled;
  2. of the number of complaints about advertisements containing incorrect information received by the department concerned, as well as the number of companies which have been prosecuted as a result of such complaints in the past three years; and
  3. what regulatory measures have the Government put in place to ensure that advertisements released through the mass media contain no misleading or incorrect information?

SECRETARY FOR RECREATION AND CULTURE: Mr President, the Broadcasting Authority (BA) issues Codes of Practice in respect of advertising on radio and television. Broadcasters are required under their licence conditions to adhere to these Codes, and to exercise reasonable care and diligence to ensure that the factual claims made in advertisements are correct. Through its executive arm, the Television and Entertainment Licensing Authority (TELA), the BA monitors broadcasts to check for compliance and also acts on public complaints. The BA may warn broadcasters who contravene the Codes, or impose a financial penalty up to a maximum of $250,000. During the last three years, TELA received 110 complaints alleging incorrect information in advertisements broadcast on television and radio. After investigation, 80 of these complaints were found not to have contravened the Codes. Of the remainder, warnings were issued in 27 cases, and three cases have yet to be considered by the BA.

There is no overall control of advertising in the print media, although a variety of Ordinances governs specific types of advertisements. The Undesirable Medical Advertisements Ordinance (Cap. 231) regulates advertisements promoting medical treatments, and is administered by the Department of Health. That Department regularly screens newspapers and warns those who publish undesirable advertisements (or cause them to be published). Where warnings do not suffice, the cases are referred to the police. Over the past three years, 220 warnings have been issued, and six prosecutions taken out.

Under the Protection of Investors Ordinance (Cap. 335), the authorization of the Securities and Futures Commission ("SFC") is required for all advertisements which contain a public offer of securities or investment arrangements, unless otherwise exempted. The SFC authorization vets such advertisements prior to issue for, among other things, incorrect, exaggerated or misleading information. In addition, the SFC also monitors the local papers for unauthorized advertisements and acts on complaints. Over the past three years, it has acted on 15 complaints, mostly by requiring the offending advertisements to be amended or withdrawn. Eight prosecutions have been mounted in recent years.

The Consumer Council also assists consumers to obtain remedies when they complain of incorrect or exaggerated information in advertisements, although it has no powers of prosecution. If appropriate, the Council may refer the case to the Customs and Excise Department for further examination under the Trade Descriptions Ordinance (Cap. 362). Statistics on the number of complaints about advertisements in the print media received by the Consumer Council are not readily available as complaints are entered by product or service specific categories.

Safety Standards for Glassware Products

12. MR CHAN KAM-LAM asked (in Chinese): Will the Government inform this Council:

  1. of the number of accidents involving industrial and household glassware products and installations in the past three years; and
  2. whether it will consider introducing regulations to stipulate the safety standards for glassware products and to require manufacturers to specify on their products the types of glass used and the level of durability measured in an impact-test?

SECRETARY FOR TRADE AND INDUSTRY: Mr President,

  1. We do not have statistics on the number of accidents involving industrial and household glassware products and installations. Industrial accident statistics are analyzed by cause and by industry. There is no breakdown by either the material or the equipment involved in industrial accidents. The Hospital Authority compiles patient statistics according to international classification of diseases. It does not have separate figures on the number of accidents involving use or installation of glassware products.
  2. The safety of glassware products for private use or consumption is already covered by the Consumer Goods Safety Ordinance, which came into force in October this year. This Ordinance imposes a statutory duty on manufacturers, importers and suppliers of consumer goods (including glassware products) to ensure that the goods they supply in Hong Kong are safe. Section 4 of the Ordinance further requires that consumer goods (including glassware products) supplied in Hong Kong must comply with a general safety requirement which includes, inter alia, the adoption of reasonable safety standards published by a standards institute. Any supplier who fails to comply with the requirement under the Ordinance commits an offence. The Commissioner of Customs and Excise will monitor the situation and take enforcement action as appropriate.
    Accordingly, we do not see the need to introduce specific regulations to stipulate the safety standards for household glassware products and to require manufacturers to specify on their products the types of glass used and the level of durability measured in an impact test.

Relocation of Methadone Clinic to Tsui Ping Estate

13. MR FRED LI asked (in Chinese): The 10-year redevelopment programme for Kwun Tong Town Centre proposed by the Land Development Corporation includes the relocation of the methadone clinic at the Town Centre to Tsui Ping Estate nearby. As methadone clinics often bring nuisance to the community in which they are located, will the Government inform this Council:

  1. whether it will consult local community groups and residents in this regard; if so, what are the details; if not, why not;
  2. whether the Government will make alternative arrangements to set up the methadone clinic further away from Tsui Ping Estate in view of the worsening drug abuse problem in that Estate; and
  3. what long-term and interim measures the Government has adopted to tackle the drug abuse problem in the neighbourhood of Tsui Ping Estate?

SECRETARY FOR SECURITY: Mr President,

  1. The Kwun Tong Town Centre Redevelopment Scheme proposed by the Land Development Corporation (LDC) is still being considered by the Corporation and the Administration. If the Scheme is to be implemented, the Kwun Tong District Board, and other relevant local bodies, where appropriate, will be consulted in advance on any proposal to relocate the methadone clinic.
  2. No decision has been made on whether and where the methadone clinic in Kwun Tong should be relocated. The Government is open-minded about the location of methadone clinics. An important consideration is the accessibility of the clinic, as the objective of the methadone programme is to offer a readily accessible out-patient service for those drug abusers who seek treatment but, for various reasons, would not be able to take part in residential treatment programmes.
  3. The drug abuse problem in the neighbourhood of Tsui Ping Estate is being tackled at source by stepped-up law enforcement action, and preventive education and publicity.
    Police enforcement action against drug activities in Tsui Ping Estate has been stepped up. This can be seen from the number of arrests for serious narcotics offences in Tsui Ping Estate, which has increased from 46 in 1994 to 80 in the first nine months of 1995. At the street level, enhanced enforcement actions are taken on a daily basis against drug sellers and users. Information and intelligence on drug activities, with particular emphasis against drug sellers, are collected, collated and acted upon by the Kwun Tong District Special Duties Squad to target known drug sellers.
    The police also contributes to anti-drug education by organizing school visits and seminars with school headmasters and discipline masters, focussing on the prevention of drug abuse by students.
    Extra efforts have been put in preventive educational and publicity measures to arouse awareness among Kwun Tong residents on the drug problem. Emphasis has been laid on enhancing parents' understanding on the prevention and early detection of their children's involvement in drugs. In 1995-96, a total of seven programmes involving 10 000 participants have been/will be implemented by the social welfare service units in the district. Existing counselling services of family service centres and probation offices in the district have also been strengthened to help young people with drug problems and their families.
    The District Social Welfare Office (DSWO) in Kwun Tong has formed a Working Group on "District-wide publicity campaign in combating illicit use of drugs among young people in Kwun Tong District" in April*1995, to promote co-ordination and co-operation among government departments and local organizations to tackle the drug problem. A "Drug Ambassador Scheme" is now being launched by the Working Group, with the aim of publicizing widely anti-drug messages among young people through a signature campaign. So far over 7 000 participants from more than 30 local organizations have been enrolled. The Working Group also compiles leaflets on district beat-drug activities on a regular basis to encourage participation of local residents.
    In the longer term, the DSWO in Kwun Tong will continue to take active part in the Kwun Tong District Fight Crime Committee to plan and co-ordinate anti-drug strategies at the district level. Group work units in the district, particularly the Group Work Unit of the Kwun Tong Community Centre (which is located in Tsui Ping Estate) will organize regular activities to educate young people to stay away from drugs. Services from the "Against Substance Abuse Scheme" provided by the team of specially trained social workers newly set up by the Social Welfare Department would also be tapped whenever necessary.
    A paper on "Illicit use of drugs in Kwun Tong District" was discussed at the Kwun Tong District Fight Crime Committee meeting in May*1995 to co-ordinate district efforts in tackling the problem. Local non-government organizations will be encouraged to organize anti-drug activities through various channels such as the Kwun Tong District Committee on Family Life Education, the Kwun Tong District Group and Community Work Service Co-ordinating Committee. Social workers of the Society for the Aid and Rehabilitation of Drug Abusers working in the methadone clinic in the district will continue to provide casework services to drug abusers to facilitate their social rehabilitation.

Air Services to Taiwan

14. MR LAW CHEUNG-KWOK asked (in Chinese): Will the Government inform this Council:

  1. whether, in order to be eligible to apply for a licence to operate air services between Hong Kong and Taiwan, the China National Aviation Corporation (CNAC) has made a formal application to become an airline whose principal operation is based in the territory; if so, what factors the Government will take into consideration in determining whether a licence will be granted to CNAC to operate the route; if not, whether it will consider inviting CNAC to make such an application; and
  2. what share of the market does the Cathay Pacific Airways (CPA) have in providing air services between Hong Kong and Taiwan, and whether CPA has adopted any policy which is not in the interest of the consumers?

SECRETARY FOR ECONOMIC SERVICES: Mr President,

  1. The China National Aviation Corporation (Hong Kong) Limited (CNAC(HK)) submitted an application for an Air Operator's Certificate (AOC) to the Civil Aviation Department (CAD) on 29 March 1995. Securing an AOC is a necessary prerequisite to operate Hong Kong registered aircraft for the purpose of public transport. An AOC may be granted if the Governor is satisfied that the applicant is competent, having regard in particular to his previous conduct and experience, his equipment, organization, staffing, maintenance and other arrangements to secure the safe operation of aircraft of the types specified in the certificate. CNAC(HK) has not yet submitted any documents in support of its application. CAD will give due consideration to the application when such documents are received.
    An application for an AOC is the first of several steps which a company has to go through before it will be able to mount scheduled air services with Hong Kong registered aircraft. In addition, the company will also have to apply for registration of its aircraft, obtain a licence for a specific route from the Air Transport Licensing Authority and seek designation by the Government for the route concerned. It is not government policy to invite any particular airline to make an application for any route; the airline concerned would have to apply and fulfill all the necessary requirements before it will be permitted to operate.
  2. At present, scheduled air services between Hong Kong and Taiwan are operated between Hong Kong and two cities in Taiwan, namely, Taipei and Kaohsiung. On the Hong Kong - Taipei route, the Cathay Pacific Airway's (CPA's) market share was 51.1% in the 12 months up to August 1995. On the Hong Kong - Kaohsiung route, CPA's market share was 53.8% in the same period.
    On both of the routes between Hong Kong and Taiwan, there is a choice for consumers. On the Hong Kong * Taipei route (which constitutes 82% of the total traffic between Hong Kong and Taiwan), six other airlines, apart from CPA, operate on the route. They are British Asia Airways, China Airlines, Japan Asia Airways, Singapore Airlines, Garuda Indonesia Airways, and Thai Airways International. On the Hong Kong * Kaohsiung route where traffic is only about 18% of the total traffic between Hong Kong and Taiwan, China Airlines operate on the route in addition to CPA.

Application and Approval of Search Warrants

15. MR CHIM PUI-CHUNG asked (in Chinese): In regard to applications for search warrants by government departments, will the Government inform this Council:

  1. of the criteria on which the court's approval of an application for search warrant file by a government department is based and whether there is any system to keep this power in check;
  2. whether the court or the department which files the application will be held responsible in the event that the application is subsequently proved to be at fault or ultra vires;
  3. of the time normally taken for obtaining a search warrant; and
  4. if members of the public have objections to be contents of an application for search warrant, to which department should they go to in order to raise their objection prior to the grant of the search warrant?

CHIEF SECRETARY: Mr President,

  1. In granting applications for search warrants, the court acts in accordance with the provisions in the relevant legislation under which the applications are made. The magistrate responsible will make sufficient enquiry to satisfy himself that there is reasonable cause to suspect that the items in respect of which the warrant is sought are on the premises to be searched. Such enquiry could include questioning the police officer requesting the search warrant under oath or affirmation or requiring the information in support of the warrant to be more precise.
    The power to grant warrants is discretionary. Therefore, a magistrate is not required to accede to an application for a search warrant even where the statutory requirements have been met. This together with the fact that a magistrate must refuse to grant a warrant if he is not satisfied that there is reasonable cause to suspect that the items in respect of which the warrant is sought are on the premises to be searched, serves to keep searches by government departments in check.
  2. Whether the court or the department which filed the application would be held responsible in the event that the application is subsequently proved to be at fault or ultra vires depends upon the circumstances in which the search warrant was issued. In general terms, a court could only be held responsible where it was established that it was acting maliciously and without reasonable and probable cause; and a government department could only be held responsible where it was established that it was acting maliciously.
  3. A department can normally obtain a search warrant from the court on the same day it files an application.
  4. An application for a search warrant is made ex parte, that is, only the party making the application is present. To inform the owner of the premises to be searched of the application would defeat the purpose of the search.

Air-tickets for Civil Servants on Duty Visits

16. MR CHEUNG MAN-KWONG asked (in Chinese): With regard to the purchase of air-tickets by the Government for civil servants on overseas duty visits and training, will the Government inform this Council:

  1. of its policy on purchasing such air-tickets;
  2. whether agreements have been made with any airlines for the purchase of air-tickets; if so, what are the details and why such agreements have been made;
  3. of the expenditure involved in purchasing such air-tickets during the past two years, together with a breakdown of the number of civil servants involved and their destinations;
  4. whether the Government has information to show that the adoption of its present policy on the purchase of such air-tickets, as compared with purchases made through travel agents or by other means, will result in a higher expenditure of public funds; if so, what are the reasons for continuing with the present policy; and
  5. whether consideration has been given to reviewing the present policy on the purchase of such air-tickets; if so, what are the details; if not, whether the Government will consider adopting other arrangements to purchase such air-tickets, such as placing orders with the airline purchase such air-tickets, such as placing orders with the airline charging the lowest fares or introducing other forms of competition?

SECRETARY FOR THE CIVIL SERVICE: Mr President, the answers to the questions raised are:

  1. The Government has an agreement with the British Airways (BA) and Cathay Pacific Airways (CPA) under which air-tickets (from any airlines) for civil servants on overseas duty visits have to be purchased through Jardine Airways (BA's general agent) or CPA. Air-tickets for civil servants on overseas training are not covered by the agreement, and can be purchased through any travel agent which accepts direct payment by the Treasury.
  2. The passage agreement with BA and CPA basically covers the Government's duty and school passages, but the Government may also make use of the contract fares for other passages to and from the United Kingdom. The main features of the agreement are:

    1. BA and CPA provide air-tickets at reduced fares on the Hong Kong - United Kingdom direct route (the United Kingdom route); and
    2. air-tickets on non-United Kingdom routes (from any airlines) have to be purchased through Jardine Airways or CAP.
      The Government entered into an agreement with the two airlines because the service required by the Government was and remains mainly passages on the Hong Kong - United Kingdom direct route ─ the bulk of which relate to school passages. Until 1994 only BA and CPA provided direct-route service to the United Kingdom. With the exception of Virgin Atlantic Airways (VAA) which started operating on the Hong Kong - United Kingdom direct route in 1994, the other airlines do not provide direct-flight service on the this route and therefore are unable to participate. We are discussing with BA and CPA the possibility of including the service of VAA in the current agreement.
    3. The expenditure involved in purchasing air-tickets for civil servants' overseas duty visits and training in 1993-94 and 1994-95 is $85.4 million, involving a total of 5 956 return passages. We have not kept specific records on the destinations of these passages.
    4. On the whole, we are getting a reasonable deal out of the agreement with BA and CPA as the Government is able to benefit from the reduced fares on the Hong Kong - United Kingdom direct flights with guaranteed bookings in both peak and off-peak seasons. The current arrangement for the purchase of air-tickets for civil servants' overseas duty visits and training, even if considered on its own, does not incur a much higher public expenditure, since the costs of published-fare air-tickets are roughly the same irrespective of from which agent they are bought. We are using published fares because the lower-fare air-tickets available in the market are very often special or promotional-fare tickets with usage restrictions attached, which would frequently not meet the operational requirements of these duty visits.
    5. With a view to achieving further savings, we are discussing with BA and CPA the possibility of including the service of VAA in the current agreement. We are also reviewing the scope of our being able to make use of the cheaper air fares available in the market for civil servants' overseas duty visits and training.

Green Island Public Dump Scheme

17. MR AMBROSE LAU asked (in Chinese): Now that the Government is consulting the public on the feasibility of the Green Island Public Dump Scheme and that the removal of Hong Kong International Airport has been scheduled for 1998, will the Government inform this Council whether consideration will be given to transporting construction waste on Hong Kong Island by land or by sea to the waters off the Airport and Kowloon Bay for dumping as an interim measure, as such a move will prepare that area for the future reclamation work on the one hand and allow more time for the public to study the policies relating to the Green Island reclamation on the other?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, the Territory Development Department has commissioned a feasibility study on the proposed future development of Kowloon Bay and the current Hong Kong International Airport. The study will examine, among other things, the possible sources of fill material, including construction waste, suitable for the proposed reclamation at Kowloon Bay. Findings of the study will help the Government in considering the viability of public dumping at Kowloon Bay and/ or the Airport. The study is scheduled to be completed in mid-1997. No decision will be made before the Government has examined the findings thoroughly.

Oxygen Content in Air

18. DR SAMUEL WONG asked: The proportion of oxygen in the air in some urban districts is sometimes found to be as low as 10%, although the normal oxygen content in the air is about 20%. In such circumstances, people will have to inhale more air, and hence more pollutants, than normal in order to get the oxygen required. In this connection, will the Government inform this Council whether:

  1. the Government will consider releasing the multiplication factor of pollution intake in each district due to lower oxygen content along with the pollution indices now published daily by the Environmental Protection Department; and
  2. if the answer to (a) above is in the negative, whether the Government will consider taking such factor into account in determining the pollution indices?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, the Air Pollution Index is designed to reflect the quality of outdoor air, of which the oxygen content is constantly at the normal level of 20%. In the outdoor environment, the carbon dioxide level in Hong Kong is well below 0.5% and variations around this level of concentration will not affect the oxygen content of the air. The issue of low oxygen in outdoor air is only relevant to locations at altitudes above 10 000 feet; but this is not relevant to Hong Kong. It is therefore not necessary for the Air Pollution Index to take into account the oxygen content. Hence, the answers to both (a) and (b) are in the negative.

Monitoring of H Share Companies

19. DR HUANG CHEN-YA asked (in Chinese): Will the Government inform this Council whether:

  1. the Securities and Futures Commission (SFC) will make a comparison between the profits predicted in the prospectuses of H share companies and the performance of these companies as published after the first year;
  2. the SFC has carried out investigations into companies which have recorded marked discrepancies between the predicted and actual profits; if so, what are the findings; and
  3. there are statutory provisions requiring merchant banks to be responsible for the accuracy of the information contained in prospectuses; if so, what are the liabilities of the merchant banks in the event that the particulars in the prospectuses are found to be incorrect, and what penalties will be imposed on them; if not, whether the Government will require merchant banks to assume responsibility, so as to reduce the chance of investors being misled?

SECRETARY FOR FINANCIAL SERVICES: Mr President,

(a) and (b)

    The Stock Exchange of Hong Kong (SEHK) is the frontline regulator responsible for the supervision of listed companies and the administration of all related matters. The SFC oversees the SEHK but is not directly involved in such matters.

    The SEHK reviews the performance of all newly listed companies, including H share companies, for the first accounting year after their listings, and compares that with the projected profits stated in the respective prospectus of the companies.

    All listed companies are required to sign a Listing Agreement and to abide by the SEHK Listing Rules. Under the Listing Agreement, a listed company is obliged to notify shareholders promptly of the occurrence of any event which could cause the forecast assumptions to be materially different from those stated in the prospectus and to indicate the likely impact of such event on the projected profits. The Listing Agreement also requires a company in such circumstances to include an explanation for such material difference in its directors' report and accounts.

    The SEHK monitors compliance with the Listing Rules and carries out inquiries where necessary. During the past three years, the SEHK has found two cases (one of which involves an H share company) where the actual results published in the directors* report and accounts differed materially from the projected profits stated in the relevant prospectus. In both cases, the company involved has issued a clarification statement to the public in accordance with the relevant Listing Rules.

  1. There are no statutory provisions which expressly impose special responsibilities on merchant banks for the accuracy of prospectuses. However, there are statutory provisions under which merchant banks could be exposed to criminal and civil liabilities in respect of untrue statements in prospectuses. Such liability is imposed on every person who has authorized the issue of the prospectus containing untrue statements. Coming within the wide class of persons who authorize the issue of the prospectus can be brokers, merchant banks, solicitors and others associated with the prospectus.
    Civil liability is created by section 40 of the Companies Ordinance (the Ordinance) in respect of Hong Kong companies, and section 342E of the Ordinance in respect of companies incorporated outside Hong Kong. The liability is to persons who subscribe for securities on the faith of a prospectus and sustain loss or damage by reason of any untrue statement contained therein.

    Criminal liability is created by section 40A of the Ordinance in respect of Hong Kong companies and section 342F of the Ordinance in respect of companies incorporated outside Hong Kong. If a prospectus contains a false statement, any person who authorized its issue will be guilty of an offence unless he can establish certain specific defences.

    The penalty for breaching section 40A or section 342F of the Ordinance is a fine of $500,000 or imprisonment for three years on indictment, and a fine of $100,000 and imprisonment of 12 months on summary charge.

    If a merchant bank acts as a sponsor in relation to a listing, it also has to comply with the Model Code for Sponsors of the Listing Rules. The Code requires that the sponsor should be closely involved in the preparation of the listing document and in ensuring that all material statements therein have been verified and that it complies with the Listing Rules and all relevant legislation. Failure by a sponsor to meet its obligations under the Listing Rules without reasonable excuse may render that person unacceptable to the SEHK for performing the role of a sponsor in the future.

ADDRESS

Ocean Park Corporation Annual Report 1994-95

MR RONALD ARCULLI

: Mr President, tabled before the Council today is the 1994-95 annual report of the Ocean Park Corporation.

In the financial year that ended on 30 June 1995, the Ocean Park enjoyed another year of record attendance with 3.3 million visitors to the Park, an increase of 5% on last year's record of 3.2 million.

The Ocean Park's revenue grew by 6% to HK$324 million. Operating income was HK$319 million. The net operating surplus for the financial year was HK$23 million, which compared with a net operating surplus of HK$53 million in the 1993-1994 financial year.

These results are most satisfactory given the difficulties encountered during the year. The higher attendance figure was pleasing given that Hong Kong experienced a series of severe tropical storms during the year which necessitated partial closure of the Park.

The number of overseas visitors to the Park fell by 9% mainly due to the drop in the number of tourists from China and Taiwan. Fortunately, more local residents visited the Park. The record number of visitors was largely due to improvements in the Ocean Park and new attractions which opened during the year.

Three new attractions costing a total of HK$58 million were opened in time for the Christmas-New Year holidays. On the Headland, we opened the 100-foot tall Ferris Wheel which provides spectacular views 400 feet above the South China Sea. We also opened the Eagle Ride which proved extremely popular. However, it is currently closed while modifications are made and tested. We plan to have the ride fully operational early next year. On the Lowland, we opened the Dinosaur Discovery Trail which, with its lifelike models and animatronic robots, proved an instant success with the public.

The largest influx of visitors came during the spring in response to the re-opening of the Atoll Reef. The Atoll Reef has traditionally been the Park's most popular attraction. The Reef has undergone a HK$65 million refurbishment and is now the largest reef aquarium in the world.

During its first full year of operation, the Ocean Park Conservation Foundation announced a five-year plan involving 16 whale and dolphin projects which include identification of conservation problems, development and executive of action plans, and long-term research to direct and support future marine mammal conservation efforts in the region.

The Foundation also convened the first meeting of the Asian River Dolphin Committee. Scientists from nine countries, including China, and representatives of the IUCN Cetaccan Specialist Group and The Whale and Dolphin Conservation Society met to discuss strategies for protecting threatened marine mammals.

The Ocean Park has an on-going commitment to improve access to the Park's facilities for Hong Kong's disabled residents. This year, new facilities for the disabled included contour models for mechanical rides, tactile maps and guide books for the visually impaired, improved access for wheelchair-bound visitors and the installation of a special gondola for disabled visitors on the new Ferris Wheel.

While the recent difficulties experienced at the Park fall outside this financial year, it would be remiss of me not to congratulate the management and staff on the way they handled the consequences of the tragic Aberdeen landslide.

Through their work, the comfort and safety of both visitors and of the Park's marine mammals, fish and animals were assured, and the Park was able to return to normal operations in a speedy manner. Above all, we owe special thanks also to the Government Flying Service, the Fire Services Department and the Electrical and Mechanical Services Department.

Looking to the future, our long-term development plan is to continue to expand and to better serve the needs of all age groups and interests within the community. In the next year, we expect to have further improvements and add new attractions including the opening of a Mine Train roller coaster and a high-tech simulator ride.

After a year that was both rewarding and eventful, the Ocean Park will continue to work to fulfill its mission to provide a balanced mix of recreation, education and conservation. I believe the Ocean Park is well set to achieve even higher levels of popularity and success.

Thank you, Mr President.

MOTIONS

EMPLOYEES' COMPENSATION ORDINANCE

THE SECRETARY FOR EDUCATION AND MANPOWER to move the following motion:

    "That, with effect from 1 January 1996, the Employees' Compensation Ordinance be amended as follows -
  1. in section 6 -
    1. in subsection (1)(a), (b) and (c), by repealing "$15,000" and substituting "$18,000";
    2. in subsection (2), by repealing "$219,000" and substituting "$262,000";
    3. in subsection (5), by repealing "$12,000" and substituting "$14,000";
  2. in section 7 -
    1. in subsection (1)(a), (b) and (c), by repealing "$15,000" and substituting "$18,000";
    2. in subsection (2), by repealing "$248,000" and substituting "$297,000";
  3. in section 8(1)(a) and (b), by repealing "$297,000" and substituting "$356,000";
  4. in section 11(5), by repealing "2,250" where it twice appears and substituting "2,450";
  5. in section 16A(10) -
    1. in paragraph (a), by repealing "$350" and substituting "$420";
    2. in paragraph (b), by repealing "$700" and substituting "$840";
  6. in section 17A(1) -
    1. in paragraph (a), by repealing "$350" and substituting "$420";
    2. in paragraph (b), by repealing "$700" and substituting "$840";
  7. in section 36C, by repealing "$24,000" and substituting "$28,000";
  8. in section 36J, by repealing "$74,000" and substituting "$86,000";
    1. in paragraphs 1(b), 2(b) and 3 of the Third Schedule, by repealing "$120" and substituting "$160"."

He said (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

The purpose of this resolution is to revise the levels of compensation and certain compensation-related items under the Employees' Compensation Ordinance. The Ordinance provides for payment of compensation by employers to employees who are injured or killed as a result of employment-related accidents. Our policy since 1978 has been to review the levels of compensation every two years to take account of wage movements, inflation and other changes. The existing levels of compensation have been in force since 1 January 1994 and are now due for revision. We propose that the revised rates should take effect as from 1 January 1996.

We propose to increase the ceiling for monthly earnings from $15,000 to $18,000. This figure is the basis on which the maximum amounts of compensation for permanent total incapacity and for death are calculated under the Ordinance. We also propose to increase the minimum levels of compensation for death from $219,000 to $262,000, and for permanent total incapacity from $248,000 to $297,000. In addition, we propose that the maximum amount of compensation for the costs of care required by another person be revised from $297,000 to $356,000. For late payment of compensation, we propose to increase the minimum amount of surcharge imposed upon expiry of the payment period from $350 to $420 and the minimum additional surcharge imposed three months after expiry of payment period from $700 to $840. Each of these six proposed revisions represents an increase of about 19.7% over the existing levels, which is in line with the increase in nominal wages during the past two years.

The ceilings on three other forms of compensation are to be adjusted to take account of inflation since their last revision in 1994. The proposed changes include increasing the maximum amount for burial expenses from $12,000 to $14,000, and increasing the maximum payments to be made by an employer towards the costs of supplying and fitting a prosthesis or a surgical appliance from $24,000 and $74,000 respectively to $28,000 and $86,000 respectively.

We also propose to raise the maximum daily rate of reimbursement of medical expenses from $120 to $160 to take account of the increase in fees charges by public hospitals and clinics since 1994.

Finally, we propose to revise the amount that is deemed to be the minimum earnings per month for the purpose of calculating compensation from $2,250 to $2,450. This proposed increase serves to keep the deemed minimum earnings of an injured employee broadly in line with the existing rate of payment to a singleton under the Comprehensive Social Security Assistance Scheme.

These proposals have been endorsed by the Labour Advisory Board and I recommend them to this Council for approval.

Mr President, I beg to move.

Question on the motion proposed.

MR LAU CHIN-SHEK (in Cantonese): Mr President, I certainly support today's motion which seeks to increase the rate of compensation for workers who were injured or even killed in the course of their work. However, I would also like to take this opportunity to state again what I think are the shortcomings of the present Employees' Compensation Ordinance, hoping that the Government will review the whole system of workers' compensation as soon as possible.

The legislation currently in force has stipulated various ceilings for calculating the rate of compensation for workers who have permanently lost the ability to work in the course of their work and has made it impossible for workers to obtain the compensation that they deserve. First, concerning the calculation of the monthly wage ceiling. Although today's motion seeks to increase the monthly wage ceiling from $15,000 to $18,000, that is still an unreasonable restriction, especially in the construction sector in which workers suffer serious injuries. For the many steel fixers, scaffold erectors and the majority of other professionals who may be earning a monthly wage exceeding $18,000, the present legislation has undoubtedly deprived them of the compensation that they deserve. Therefore the Government should consider abolishing the monthly wage ceiling. In fact, the present monthly wage ceiling for the calculation of severance pay and long service payment has already been increased to $22,500, but that for the calculation of workers' compensation is only to be increased to $18,000. This is obviously an unfair treatment to workers claiming workers' compensation.

Second, concerning the upper limit of the amount of compensation. According to the Employees' Compensation Ordinance, the maximum amount of compensation which workers can claim of the basis of injury or death sustained in the course of work is equivalent to seven years or eight years of their total income respectively. These ceilings, which have been set without and objective criteria, are particularly unfair to young workers seeking workers' compensation. For instance, a 17-year-old summer job worker was killed in an accident involving a hoist in North Point in June 1993. According to the law, he could only obtain compensation equivalent to eight years of his total wage and deductions had to be made according to the family's reliance on him. As a result, this worker's family could only obtain compensation amounting to $100,000 plus. Do you think that is fair? Human life is invaluable and the law which has imposed various restrictions on workers' compensation should absolutely be reviewed and improved. The Government may think that workers claiming workers' compensation can try to obtain more by suing their employers for negligence through civil proceedings. However, legal proceedings not only involve many problems of evidence, they are also very time-consuming; and a law suit will normally drag on for three to five years. That is undoubtedly unfair to the injured workers and their families. Therefore, I think a comprehensive review on the Employees' Compensation Ordinance should be conducted without delay so as to strengthen the protection given to workers claiming workers' compensation. Of course, what is more important is to improve industrial safety in Hong Kong so as to prevent the occurrence of accidents.

Mr President, with these remarks, I hope the Secretary for Education and Manpower can clearly respond to my demands in his concluding speech later on. Thank you.

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, I would like to thank the Honourable LAU Chin-shek for his speech as well as his support for this motion. I have listened very carefully to the views expressed by Mr LAU on some items. The Government will consider these views in detail in the next review. There is no doubt that we will fully consider the views of both the employers and employees with regard to this Ordinance in every review.

Thank you, Mr President.

Question on the motion put and agreed to.

PNEUMOCONIOSIS (COMPENSATION) ORDINANCE

THE SECRETARY FOR EDUCATION AND MANPOWER to move the following motion:

    "That, with effect from 1 January 1996, the Pneumoconiosis (Compensation) Ordinance be amended as follows -
  1. in the First Schedule -
    1. in paragraph 1 of Part II, by repealing "$2,100" and substituting "$2,570";
    2. in Part IV, by repealing "$3,500" and substituting "$4,050";
    3. in Part VI, by repealing "$12,000" and substituting "$14,000";
  2. in the Second Schedule, in paragraphs 1(b), 2(b) and 3 of Part I, by repealing "$120" and substituting $160".

He said (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

The purpose of this resolution is to revise the levels of compensation and certain compensation-related items under the Pneumoconiosis (Compensation) Ordinance. The Ordinance provides for payment of compensation for persons who were diagnosed after 1 January 1981 to be suffering from pneumoconiosis. We propose that the revised rates should take effect as from 1 January 1996.

We propose to raise the ceilings in respect of two items of compensation under the Ordinance to take account of inflation and wage movements since July 1993. First, we propose to increase the amount for calculating the monthly compensation for total incapacity, from $2,100 to $2,570. In this respect, it should be noted that under the Pneumoconiosis (Compensation) (Amendment) Bill which was introduced into this Council on 6 December 1995 (that is last Wednesday), the amount of $2,100 was proposed to be made a separate compensation item for pain, suffering and loss of amenities which would be paid to all eligible pneumoconiotics regardless of their degree of incapacity. Therefore, if this proposed revision is approved, we will move a Committee Stage Amendment to the Bill to revise the amount to $2,570. Secondly, we prepare to increase the amount of compensation for care and attention from $3,500 to $4,050.

Separately, we also propose to revise the rates of funeral expenses and medical expenses payable under the Ordinance which have always been identical to those specified in the Employees' Compensation Ordinance. As the rates of such expenses under the Employees' Compensation Ordinance have just been raised by a resolution of this Council, I propose that the levels of these two items be similarly revised.

The proposed have been endorsed by the Labour Advisory board and I recommend them to this Council for approval.

Mr President, I beg to move.

Question on the motion proposed, put and agreed to.

STAMP DUTY ORDINANCE

THE SECRETARY FOR THE TREASURY to move the following motion:

    "That section 29I(1) of the Stamp Duty Ordinance be amended by repealing "31 December 1995" and substituting "31 December 1997"."

He said (in Cantonese): Mr President, I move the resolution standing in my name on the Order Paper.

I would like to first outline the background. In January 1992, Members approved amendments to the Stamp Duty Ordinance (Cap. 117). Among other things, these amendments required stamp duty to be paid on all agreements for sale of residential property. By contrast, stamp duty was previously only payable on the assignment of the property.

This measure was one of a series of actions to curb speculation in residential property. It is a disincentive to those who speculate on property in the period between the conclusion of a sale agreement and the assignment. Apart from the additional stamp duty a speculator has to pay for each sale before assignment, the speculator also has a potential profits tax liability. The information on sale agreements provided to the Commissioner of Inland Revenue under the measure enables him to identify property transactions which may be liable to profits tax. This ensures that the speculators pay a fair share of profits tax. The cost of speculation has therefore been significantly increased. Genuine home-buyers are not affected by this measure except insofar as they have to pay stamp duty slightly earlier.

Under the terms of the original amendments, the measure would have expired at midnight on 31 December 1993. The intention was to allow both the administration and Members the opportunity to examine all relevant factors before deciding whether the measure should be extended. On 15 December 1993, Members approved a resolution to extended the measure for two years until 31 December 1995.

The residential property market has gradually softened. The problem of speculation has now been largely contained. This is the combined effect of measures proposed by the Inter-departmental Task Force on Land Supply and Property Prices, mortgage lending policy of banks, changes in interest rates, as well as the increased cost of speculation as a result of the stamp duty measure. It is therefore important that the stamp duty measure be extended. Otherwise, it would send a wrong signal to the market that the Government no longer wished to curb speculation in residential property. There would also be a significant risk that speculation may be rekindled to the detriment of genuine home-buyers.

The motion before Members today seeks the extension of the measure by a further period of two years beyond 31 December 1995. I am grateful that the Legislative Council Subcommittee formed to study the motion supports the extension of the measure in principle though I understand that there are different views in respect of the period of extension, that is whether the measure should be extended for one year or two years.

It is clear that the measure is effective in containing speculation. It does not affect genuine home-buyers. It has been in place for nearly four years and is well established and accepted by the public. I therefore do not see any reason why we should deviate from our previous practice of extending the measure for two years which may otherwise give a wrong signal to the market in respect of this Council's determination in containing speculation. In fact, we have also informed the Subcommittee that it is our plan to seek the views of Members later on in this session with a view to introducing an amendment to the Stamp Duty Ordinance to make the measure permanent. This will eliminate unnecessary speculation which may otherwise occur each time the expiry date of the measure approaches. The proposed two-year extension would allow Members sufficient time to study the permanent arrangement proposal. However, if the measure were to be extended for one year only and the amendment to the Stamp Duty Ordinance to make the measure permanent could not be processed in time, we might have to seek an extension again before the end of next year, thereby adding an unnecessary burden to the heavy agenda of this Council. I therefore strongly recommend to Members that the two-year extension should be supported.

Finally, I am also grateful to the Members of the Subcommittee for their views on how we should revise the stamp duty system in order to alleviate the financial burden of genuine home-buyers and to safeguard against abuse. I can assure Members that we will examine these views carefully before we submit the permanent arrangement proposal to this Council.

Mr President, I beg to move.

Question on the motion proposed.

PRESIDENT: Mr Ronald ARCULLI has given notice to move an amendment to the motion. His amendment has been printed on the Order Paper and circularized to Members. I propose to call on him to speak and to move his amendment now so that Members may debate the motion and the amendment together.

MR RONALD ARCULLI's amendment to the SECRETARY FOR THE TREASURY's motion:

    "To delete "31 December 1997" and to substitute "31 December 1996"."

MR RONALD ARCULLI:Mr President, I move that the Secretary for the Treasury's motion be amended as set out under my name in the Order Paper. A Subcommittee of 12 Members was formed on 20 October 1995 to study the resolution. I was elected Chairman of the Subcommittee. The Subcommittee held two meetings with the Administration, and I shall highlight two issues which were of concern to the Subcommittee.

The first concern was about the effectiveness of the stamp duty measure and its continued usefulness. While some Members of the Subcommittee agreed with the Administration that the measure could help stabilize the residential price, other Members were not as certain and pointed out that the price of other properties had also been stabilized even though they were not the subject of the same measure. Some Members also cast doubts on the continued usefulness of this measure in the light of the already softened property market and the need to stimulate the local economy.

The second concern was whether the ultimate objective of the measure was to raise revenue or to curb speculation on the residential property market. The Administration told the Subcommittee that the measure had been introduced with the principal aim of helping to curb speculation, although it had also achieved two other equitable results, which were the stamp duty payable on the sale and purchase agreement and that the Commissioner of Inland Revenue could more readily identify property transactions liable to profits tax.

The Administration acknowledged that at the time of introducing the measure, anti-speculation had been the prime factor, but in seeking its extension in the present exercise both factors were important and it was not possible to say which had a greater weight. On this particular point, my own view is that the Administration has in fact changed the stamp duty system, which has since the very beginning charged stamp duty on assignments of residential property. I cannot accept such change for the reasons of raising revenue.

The majority view of the Subcommittee was to support the Administration in seeking an extension of time on the stamp duty measure in principal, yet Members indicated they would have to make an assessment about the impact of the stamp duty measure on the local economic climate before they could decide whether the extension should be for one year, to cover until 31 December 1996, or two years until 31 December 1997.

On 6 December 1995, Mr President, I submitted an amendment to the Administration's resolution, the effect of which is to extend the operation of the relevant section to 31 December 1996 rather than 31 December 1997. I shall set out my reasons for moving such an amendment. Property speculation in the current economic climate is virtually non-existent. Indeed, it can be said that the stamp duty and other measures have achieved their objective some time ago. It must be clear to all of us that steps need to be taken to stimulate the economy and one such step would be the removal of the stamp duty measure. At the very least, the situation should be reviewed after a shorter interval than that proposed by the Administration.

It has often been said that the Hang Seng Index and the property market act as a barometer of our confidence in Hong Kong, and we know that both are substantially below their peaks. Therefore, it cannot be objectionable to extend the stamp duty measure for one year only. I doubt very much whether the Administration will find it necessary to extend its operation for another year, but if it is, the Administration will of course be at liberty to table another resolution at the appropriate time. For now, however, I urge Members to support my amendment so that the existing measure will only be extended until 31 December 1996.

In conclusion, Mr President, I urge Members to give serious consideration to the Administration's stated desire to continue receiving the extra revenue from this so-called anti-speculation measure. The Administration does not need this Council's help to raise surplus revenue. Ultimately, the cost of any extra stamp duty will find its way into the pockets of end-users who will pay for it.

When the Secretary for the Treasury, Mr President, mentioned the two-year extension, the thought just dawned on me as to how many of us will be here in two years' time, so I would urge Members to support my motion so that the control of this measure will remain with Members of this Council.

Mr President, with these remarks, I move that the Secretary for the Treasury's motion be amended as set out in the Order Paper.

Question on the amendment proposed.

MR LEE WING-TAT (in Cantonese): Mr President, the Democratic Party believes that collecting stamp duty on sale and purchase agreements of residential property is an effective measure to curb speculation. That is because suppose two or more sale and purchase agreements have been entered into before the actual assignment of a residential property, stamp duty will be payable for each and every agreement. This measure will increase the costs of speculators without affecting the real users.

At present, property prices have fallen by about 30% compared with those in April 1994 and October 1995, but they are still not affordable by the general public. According to information contained in the Government's written reply given to me last week, in 1985, an ordinary Hong Kong citizen could buy a flat of 500 sq ft in the urban area with only an amount equivalent to 120 times the median monthly wage. Now in 1995, however, the same worker will have to pay an amount equivalent to 190 times the median monthly wage to buy the same flat. Therefore, Mr President, although property prices have apparently fallen, it is only a slight fall from a very high peak and they are still not affordable by the general public, especially the grassroots. In October 1995, about 10% of all property assignments were still short-term assignments. This percentage is only slightly lower than that of what we call the peak which is 22%. Therefore, speculation has not completely disappeared, it has only dampened slightly. Short-term assignments amounting to 22% is certainly an indicator of a lot of speculation at the time, but 10% is still a significant figure.

If anti-speculation measures are immediately relaxed just when there is a fall in property prices, suppressed speculative activities will easily become active again and the ultimate victims will be the real users. Moreover, now that property prices have only fallen slightly, property developers are already feeling anxious and, with the help of our Financial Secretary, they have spread the news that property prices have hit the bottom and promoted the opinion that they will rise again very soon. Many associations of property developers have continuously lobbied the Government to relax the mortgage restrictions. Therefore, now that property prices have fallen, we have to take steps to stabilize the situation. If not, there will be an upsurge of property prices once the anti-speculation measures are relaxed.

If we extend measure to collect stamp duty on sale and purchase agreements of residential property for only a year, then a year later, before the falling trend of property prices has stabilized, speculators will have the chance to enter the market and there will be a revival of speculation. In addition, there will still be a shortage of private housing units in the next two years and less land will be available for urban redevelopment. Relaxing the anti-speculation measure in the face of reduced supply will only lead to an upsurge in property prices.

Therefore, Mr President, we do not agree with the Honourable Ronald ARCULLI's amendment and we will support the Government's motion. Thank you, Mr President.

MR CHAN KAM-LAM (in Cantonese): Mr President, up till now, the Stamp Duty Ordinance has really been effective in curbing property speculation and, therefore, the Democratic Alliance for the Betterment of Hong Kong supports the Secretary for the Treasury's motion to extend the measure to 31 December 1997. Besides, we would also urge the Government to review the present system of stamp duty as soon as possible so that, with the extra revenue obtained under the present system, tax concessions can be given to the real users in the community and the public can be encouraged to own their homes. Thank you, Mr President.

MR EDWARD HO (in Cantonese): Mr President, I remember that in the year in which the stamp duty measure was passed into law, I was Chairman of the Select Committee concerned. At that time, the Government made it clear that the measure was intended to curb property speculation. However, it seems that it has now become one of the Government's ways to grab revenue. Why do I say that?

The Honourable LEE Wing-tat talked about the question of property prices. The present level of property prices is certainly higher than that of 1985 and it is very much higher than that of 1967. There is no need for us to argue what is the level which we would consider it wrong to allow property prices to reach. However, we should be clear that it would not be possible to speculate on new flats at all. That is because with the implementation of the new measure, a flat cannot be sold earlier than nine months before the occupation permit is due to be issued and, after purchase, it cannot be assigned until the occupation permit has been obtained. Therefore, it would not be possible to speculate on new flats. Now, the subject for discussion is the speculation of old domestic units. Would it be possible to speculate on old domestic units? What does "speculation" mean? Speculation means trying to make a profit by means of assignment with very little money, that is, before all the money and costs have been paid. However, to purchase an old domestic unit, the price has to be paid in full, which means it would not be possible to speculate and we also know clearly that there are no speculative activities on property in the market. If we support the Government's motion to extend the measure for two years, we would be supporting the Government to grab revenue by using this method. It is not a question of curbing speculation. Thank you, Mr President.

MR JAMES TO (in Cantonese): Mr President, I would like to briefly respond to the Honourable Edward HO's viewpoints. In fact, I agree that it would not be possible to speculate on new flats. If there are restrictions forbidding any assignment of uncompleted flats before the occupation permit is issued, the question of how many times a new flat can be assigned between the time that a purchase agreement has been signed and the final stage when the assignment is entered into simply does not exit. Here the question is: Would it be possible to speculate on old domestic units.

When purchasing an old domestic unit, one does not necessarily have to pay the price in full because theoretically, the deposit can be set, for instance, at 10% or 20% of the price and then the agreement can be signed. If no stamp duty is payable at this stage, the purchaser and the vendor can decide on a transaction date in the more distant future. Experience shows that speculation does occur in this interim period and a unit can be assigned several times before occupation or before the assignment is entered into.

This measure will not affect the real users adversely. I believe we will agree that this is true if we really want to help the real users, no matter to which political party we belong; unless my honourable colleagues can provide any evidence that this measure will affect the real users adversely, then that will be a different matter. In fact, whether tax concessions and deductions of mortgage interests payable should be allowed and whether the amount and percentage of mortgage loan should be increased will be practical and useful measures for us to discuss now. I believe this measure will not be used to grab revenue, but even if it will, it will only be used to grab revenue from the property speculators and potential speculators, not from the users. Actually, even if this measure does not exist, stamp duty is payable anyway at the final stage when the assignment is entered into.

MRS SELINA CHOW (in Cantonese): Mr President, earlier on, I heard the Honourable James TO mention "theoretically" and, very often, we hear colleagues from the Democratic Party say "theoretically"; I think that is not the way we should consider problems.

In fact, it is not easy to differentiate clearly who are the buyers and who are the users. We have to consider clearly not only the effect of a measure on the buyers, the users or the speculators, but also the effect on the property market as a whole. Earlier on, we heard the Honourable LEE Wing-tat's speech and there is nothing much to it. Basically, he thinks that the property prices at present are not low enough; they should fall even lower and it would be best if they were reduced by half or even more. He only cares for those who want to buy their own flat, but neglects those who have already done so and have lost a fortune because they may have used up all their assets to pay for the deposit.

I believe we are not relaxing the measure. The question is: the Government said that this measure was introduced because there was a problem and that this was a temporary measure to cool off the over-heated property market. If it is temporary, then it should not be extended arbitrarily for two years, for two more years and yet two more years so that it would become a permanent measure to intervene in the market until the price reaches a level which is considered to be acceptable by some. This is not the way in which this measure should work. I am only hoping that we can understand that we are actually intervening in the market. Do we want to adopt this approach as a long-term policy? Alternatively, we can continue to give the market the message that this is actually a temporary measure: when there is a serious problem, certain measures have to be adopted; when the problem is less serious, we do not wish to intervene.

Thank you, Mr President.

MR ALBERT HO (in Cantonese): Mr President, I would like to make only a very short response. First, what is "property speculation"? To put it very simply, it means purchasing a property with a very small outlay and trying to assign it within a certain period of time after a wait-and-see period (there is already an intention of assignment at the time of purchase).

What is the method commonly used? Earlier on, the Honourable James TO has said that after the purchasers have paid the deposit, they would speculate on property by means of assignment. That was the case with the purchase of uncompleted flats in the past and that is still the method used in the speculation of old domestic units. That is not a theoretical situation. As a solicitor who has practised for more than 10 years, I have seen many people doing it. Now, with the introduction of the stamp duty measure, the assignee has to pay the stamp duty for every assignment. I think this is an effective measure to curb speculation and its effectiveness has also been generally acknowledged. Although this measure is still inadequate, the question, as the Honourable Mrs Selina CHOW suggested, is : What will be the result if this measure is cancelled?

Earlier on, Mrs CHOW has mentioned that many people have lost a lot of money as a result of the suppression of property prices and it is hoped that property prices will rise again. I hope that is not what Mrs CHOW meant. I really hope that that is not what she meant. However, we have to be very clear that this is only a temporary measure, though I do not think it will cause any unfairness. We have to emphasize time and again that at present, it is the assignee who has to pay the stamp duty. In fact, it is only fair that stamp duty is payable on every assignment of property rights. Therefore, when the Secretary for the Treasury said that a long-term review has to be carried out, I think that is a good thing. However, in the meantime, we have to spend time to review the situation and we must not give people a wrong message. We will certainly not agree should this be a measure to intervene in the market; but this is in fact a measure to increase the costs of property speculators and a way to obtain money and revenue for the Inland Revenue Department through what we think is a reasonable approach. I do not see any disadvantage and it has not created an unfair situation.

Mr President, I would like to emphasize one last point. Relying on the levy of stamp duty to curb property speculation and to stabilize property prices is not enough, good co-ordination and continued efforts by the Government are also necessary. We certainly do not agree to take any steps at this stage which would give other people a wrong message that the Government intends to relax the measure. Mr President, we support the Government's motion today in the hope that a review can be completed in two years' time so that we will know what steps should be taken in the long run. I therefore oppose the Honourable Ronald ARCULLI's amendment. Thank you.

MR ALLEN LEE (in Cantonese): Mr President, I would only like to point out that perhaps the Honourable Albert HO might have got it wrong; he used the word "cancel" just now but the Honourable Ronald ARCULLI has proposed to review, and not to cancel the measure, after a year. The use of the word "cancel" may mislead Members of this Council.

SECRETARY FOR THE TREASURY (in Cantonese): Mr President, although speculative activities in the property market have now slowed down, this does not mean that we can lower our guard. We must do our best to avoid sending any message which may make the market think that we would gradually relax or even cancel the measure related to stamp duty. In fact, with respect to property transactions which occur before or shortly after the signing of deeds of assignment, this is, cases of property re-sale, although the number has dropped from 16 023 cases in 1993 to 15 184 cases in 1994-95, 5 000 such cases were still recorded in the first six months of 1995-96. For that reason, we believe that there is a great need for the continued implementation of this particular measure. I do not accept the argument that cancelling the measure related to stamp duty can boost the economy. I believe that as far as property speculation is concerned, this will only reduce ......

PRESIDENT: Mr Allen LEE, do you have a point of order? Are you seeking elucidation?

MR ALLEN LEE: Yes.

PRESIDENT: Are you prepared to yield, Secretary for Treasury?

MR ALLEN LEE: The Secretary kept mentioning about cancelling. But Mr ARCULLI is not proposing cancelling. It is an extension to one year. So he has used the word three times already.

SECRETARY FOR THE TREASURY (in Cantonese): Mr President, perhaps the Member could not hear clearly what I just said. I said we should avoid giving any message that would make the market think there would be gradual relaxation or cancellation of this measure. I was only referring to the giving of a message. Allow me to continue with my speech.

I do not agree with the point that cancellation of the stamp duty measure can stimulate the economy. I think this will only cut the cost of the property speculators and indirectly encourage speculation activities on the property market. I have to emphasize that the measure on stamp duty is working well and it does not affect the genuine home buyers. The Honourable LEE Wing-tat has just explained the reason for this. In fact, if there are more speculation activities because of the cancellation of this measure, the cost of the genuine home buyers will be increased. Therefore, I hope Members will support the proposal to extend the stamp duty measure for two years.

Question on the amendment put.

Voice votes taken.

THE PRESIDENT said he thought the "Noes" had it.

Mr Ronald ARCULLI claimed a division.

PRESIDENT: Council shall proceed to a division.

PRESIDENT: I would like to remind Members that they are called upon to vote on the question that the amendment moved by Mr Ronald ARCULLI be made to the Secretary for the Treasury's motion.

PRESIDENT: Will Members please register their presence by pressing the top button in the voting units on their respective desks and then proceed to vote by selecting one of the three buttons below?

PRESIDENT: Before I declare the results, Members may wish to check their votes. Are there any queries? The result will now be displayed.

Mr Allen LEE, Mrs Selina CHOW, Mr NGAI Shiu-kit, Mr LAU Wong-fat, Mr Edward HO, Mr Ronald ARCULLI, Mrs Miriam LAU, Dr LEONG Che-hung, Mr CHIM Pui-chung, Mr Frederick FUNG, Mr Eric LI, Mr Howard YOUNG, Mr James TIEN, Mr Paul CHENG, Mr CHOY Kan-pui, Mr David CHU, Mr Ambrose LAU, Dr LAW Cheung-kwok, Mr Bruce LIU, Mr MOK Ying-fan and Miss Margaret NG voted for the amendment.

Mr Martin LEE, Mr SZETO Wah, Mr CHEUNG Man-kwong, Mr Michael HO, Dr HUANG Chen-ya, Miss Emily LAU, Mr LEE Wing-tat, Mr Fred LI, Mr James TO, Dr Samuel WONG, Dr Philip WONG, Dr YEUNG Sum, Mr WONG Wai-yin, Miss Christine LOH, Mr LEE Cheuk-yan, Mr CHAN Kam-lam, Miss CHAN Yuen-han, Mr Andrew CHENG, Mr CHENG Yiu-tong, Mr Anthony CHEUNG, Mr CHEUNG Hon-chung, Mr Albert HO, Mr IP Kwok-him, Mr LAU Chin-shek, Mr LAW Chi-kwong, Mr LEE Kai-ming, Mr LEUNG Yiu-chung, Mr NGAN Kam-chuen, Mr SIN Chung-kai, Mr TSANG Kin-shing, Dr John TSE, Mrs Elizabeth WONG and Mr YUM Sin-ling voted against the amendment.

THE PRESIDENT announced that there were 21 votes in favour of the amendment and 33 votes against it. He therefore declared that the amendment was negatived.

Question on the original motion put and agreed to.

MEMBER'S MOTIONS

INTERPRETATION AND GENERAL CLAUSES ORDINANCE

DR LEONG CHE-HUNG to move the following motion:

    "That in relation to the -
  1. Civil Aviation (Aircraft Noise) Ordinance (Amendment of Schedule) Notice 1995 published as Legal Notice No. 539 of 1995;
  2. Airport Authority Ordinance (71 of 1995) (Commencement) Notice 1995 published as Legal Notice No. 540 of 1995;
  3. Import (Radiation) (Prohibition) (Amendment) Regulation 1995 published as Legal Notice No. 541 of 1995;
  4. Import and Export (General) (Amendment) Regulation 1995 published as Legal Notice No. 542 of 1995;
  5. Import and Export (Fees) (Amendment) (No. 2) Regulation 1995 published as Legal Notice No. 543 of 1995;
  6. Import and Export (Registration) (Amendment) Regulation 1995 published as Legal Notice No. 544 of 1995;
  7. Ferry Services (Hongkong and Yaumati Ferry Company, Limited) (Determination of Fares) (Amendment) Ordinance 1995 published as Legal Notice No. 545 of 1995;
  8. Leveraged Foreign Exchange Trading (Calls) (Amendment) Rules 1995 published as Legal Notice No. 555 of 1995;
  9. Tax Reserve Certificates (Fourth Series) (Amendment) Rules 1995 published as Legal Notice No. 556 of 1995;
  10. Tax Reserve Certificates (Rate of Interest) Notice 1995 published as Legal Notice No. 557 of 1995;
  11. Prisoners' Education Trust Fund Ordinance (19 of 1995) (Commencement) Notice 1995 published as Legal Notice No. 558 of 1995;
  12. Official Languages (Amendment) Ordinance 1995 (51 of 1995) (Commencement) (No. 2) Notice 1995 published as Legal Notice No. 559 of 1995;
  13. Tax Reserve Certificates (Amendment) Ordinance 1995 (99 of 1995) (Commencement) Notice 1995 published as Legal Notice No. 560 of 1995;
  14. Official Languages (Authentic Chinese Text) (The Hongkong and Shanghai Banking Corporation Limited Ordinance) Order published as Legal Notice No. (C) 115 of 1995;
  15. Official Languages (Authentic Chinese Text) (Tramway Ordinance) Order published as Legal Notice No. (C) 116 of 1995; and
  16. Official Languages (Authentic Chinese Text) (Peak Tramway Ordinance) Order published as Legal Notice No. (C) 117 of 1995,

and laid on the table of the Legislative Council on 6 December 1995, the period referred to in section 34(2) of the Interpretation and General Clauses Ordinance for amending subsidiary legislation be extended under section 34(4) of that Ordinance until 10 January 1996."

DR LEONG CHE-HUNG: Mr President, I move the motion standing in my name on the Order Paper on behalf of the House. The motion seeks to extend the scrutiny period for the 16 items of subsidiary legislation tabled in the Council on 6 December 1995. As there is no sitting of the Legislative Council between 13 December 1995 to 10 January 1996, the deadline for Legislative Council intervention for these items of subsidiary legislation will fall on 3 January 1996 when there is no sitting.

In order to preserve Members' rights to amend any of these items, it is necessary to move an extension resolution to extend the period for intervention until 10 January 1996.

Mr President, I beg to move.

Question on the motion proposed, put and agreed to.

LEGISLATIVE COUNCIL (POWERS AND PRIVILEGES) ORDINANCE

MR LAU CHIN-SHEK

to move the following motion:

    "That for the purposes of enquiring into the circumstances surrounding the recent labour disputes involving imported workers under the Special Labour Importation Scheme for the Airport Core Programme Projects and related issues, the Legislative Council Panel on Manpower be authorized under section 9(2) of the Legislative Council (Powers and Privileges) Ordinance (Cap. 382) to exercise the powers conferred by section 9(1) of that Ordinance."

MR LAU CHIN-SHEK (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

Recently, labour disputes involving foreign workers of the airport projects have aroused much public concern, especially in relation to accusations of wage deductions and payment delays. In order to have an in-depth discussion of the matter, the Legislative Council Panel on Manpower held a special meeting on 5 December this year. Upon hearing the Administration's report on the labour disputes, the Panel was greatly shocked and disturbed about the unfair treatments received by the foreign workers. Although the Labour Department has stepped up its monitoring and enforcement efforts, the result is still disappointing. The Panel thinks that in order to assess the effectiveness of the new steps that have been taken or will be taken by the Government to protect the interests of foreign workers, it is necessary to understand the various arrangements for the importation of foreign labour, the role of the labour affairs companies and the extent of the contractors' responsibility. While the Government may conduct inquiries into individual cases on other aspects, the Panel thinks that it is necessary to conduct an in-depth inquiry in order to achieve the following aims:

  1. To understand the present procedures for the importation of labour and the circumstances under which wages are deducted and payments delayed;
  2. To assess whether the legislation enacted and the administrative measures adopted with a view to implementing and monitoring the Labour Importation Scheme are effective or not;
  3. To assess whether the new measures proposed by the Administration to control unlawful acts are effective or not;
  4. To put forth feasible means to strengthen the supervision, especially that of the Labour Importation Scheme; and
  5. To identify persons responsible for any unlawful acts.

In conducting this inquiry, the Panel on Manpower has to ask the parties concerned to provide evidence and relevant documents, but such parties may refuse to attend the inquiry or invoke the Legislation (Powers and Privileges) Ordinance for protection. In the circumstances, we have to ask this Council that the Panel be authorized under section 9(2) of the Legislative Council (Powers and Privileges) Ordinance to exercise the powers conferred by section 9(1) of the Ordinance. The Panel on Manpower, having submitted a report to the House Committee and obtained its support on 8 December, proposes the motion in this Council today. Now, I shall formally move the motion that the Legislative Council Panel on Manpower be authorized under section 9(2) of the Legislative Council (Powers and Privileges) Ordinance to exercise the powers conferred by section 9(1) of that Ordinance.

Mr President, with these remarks, I move the motion. Thank you.

Question on the motion proposed.

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, the recent outbreak of labour disputes on Airport Core Programme (ACP) work sites is a matter of serious concern to the Government. I should like to assure Members that a thorough investigation into each of the cases is being conducted. Hong Kong is a civilized society where the rule of law is paramount. We will not tolerate abuse of imported workers and will instigate prosecutions against those who may have breached the laws of Hong Kong. We fully appreciate Members' understandable concern about such cases and their desire to get to the truth to find out what went wrong and who is responsible. We share these sentiments entirely. However, it is not necessary nor appropriate for the Council to confer on the Manpower Panel the power under section 9 of the Legislative Council (Powers and Privileges) Ordinance to conduct an enquiry into the circumstances surrounding the labour disputes for the following reasons.

First, these labour disputes are already under investigation by the law enforcement agencies. The Labour Department has been making good progress in its investigations. In some of these cases, the investigations are at an advanced stage. Prosecutions relating to breaches under the Employment Ordinance are being considered in most of the disputes and hearings for the contractors and subcontractors involved have been arranged for this purpose. These hearings are an integral part of the due process which must be observed before taking a final decision on whether or not to lay charges. These investigation procedures are likely to be affected if the Manpower Panel of this Council is to conduct a parallel inquiry into the disputes. The use of the Legislative Council (Powers and Privileges) Ordinance whether to summon persons involved in the dispute or to ask for documents relating to the disputes will run the serious risk of delaying or jeopardizing our inquiries. I am sure Members would not wish to see this happen.

The Immigration Department is investigating into the various dispute cases to see if there are any offences under the Immigration Ordinance. The police are also at present investigating six constructions sites in connection with the recent labour disputes to ascertain whether any person has breached the law. Before these investigations are completed, any action taken by the Legislative Council to invoke the powers under the Legislative Council (Powers and Privileges) Ordinance to enquire into the circumstances of the cases may prejudice the outcome of such investigations. Any discrepancies in the statements and testimony of the same witnesses called by the police, the Immigration Department and the Panel, and the premature release of documents or evidence in connection with the cases possessed by the law enforcement agencies may impede the progress of our investigations and may adversely affect the chance of subsequent prosecutions.

Secondly, we have been in contact with the New China News Agency and are working with the relevant Chinese authorities with a view to improving communication and co-operation particularly in respect of the operation of and the legal charges imposed by the Chinese labour service companies to ensure that imported workers from PRC are aware of their rights and benefits, and to safeguard them from being exploited. I understand that the Chinese authorities have already set up a special team to investigate at their end the complaints about wage deductions. There is therefore no urgent need for this Council or the Manpower Panel to carry out an enquiry at this stage. Indeed, Members should await the outcome of the efforts by both Governments before deciding whether any further action is warranted.

As an open and accountable Government, we fully acknowledge that the public has the right to know more about the causes of and the results of our investigations into the current labour disputes. We have no intention of hiding the truth from members of the public. I intend to present to this Council in about three months' time a detailed report on the results of all our investigation efforts. This report will not only set out the outcome of investigations in Hong Kong, but will also include information about the role of the labour service companies and the result of our liaison efforts with the Chinese authorities. This will enable both Members and the general public to have a full picture of the problems involved, their causes, the effect of the various remedial measures we have recently taken and any further recommendations we may put forward to enhance the integrity of the system. Members will be given ample opportunity to discuss and raise questions on this report.

I personally led the team of officials and senior representatives of the Airport Authority (AA) and MTRC to answer questions on the ACP labour disputes at the Special Manpower Panel Meeting on 5 December 1995. My colleagues and I, including the authorities concerned, AA and MTRC, are very much prepared to continue to co-operate fully with the Manpower Panel without prejudice to our investigations. The exercise of the Legislative Council powers and privileges, if targeted at the Administration and the other institutions mentioned above, is absolutely unnecessary.

We have already provided information to the Manpower Panel on the nature of the recent labour disputes. I do not wish to repeat here. However I would like to reiterate that we have already added new conditions to strengthen our monitoring system to minimize the possibility of abuse of the scheme. With effect from 1 November 1995, employers are required to: (1) give a copy of employment contract to his imported workers; (2) provide them with details of their monthly earnings; (3) provide them with a monthly statement showing all transactions of their bank accounts. Within eight weeks upon the arrival of an imported worker in Hong Kong, the employer is required to grant him paid leave to enable him to attend briefings on his statutory rights as an employee under Hong Kong labour laws and his contractual rights under the employment contract. On top of these measures which are already in force, we intend to require employers to give an undertaking to the Labour Department that the imported workers have received a copy of the employment contract specifying the post and amount of wages before they come to Hong Kong. Officers of the Immigration Department will ask the imported worker to present his employment contract for inspection purpose shortly upon their arrival in Hong Kong.

I would like to assure this Council once again that we do not and will not tolerate any abuse of imported workers. We are committed to upholding the integrity of the ACP Labour Importation Scheme. Malpractices by a few threaten the good name of other law-abiding employers and the good name of Hong Kong. We are fully committed to do everything within our power to combat abuses and malpractices. Labour Inspectors of the Labour Department conduct regular inspections to the places of work of imported workers to check whether provisions under the Employment Ordinance and the Employees' Compensation Ordinance have been complied with and to guard against other abuses which constitute breaches of the conditions under the Scheme.

I would also like to make clear, once again, that without prejudice to any prosecutions under the laws of Hong Kong, employers who are found to have contravened conditions of the scheme will be liable to: (1) withdrawal of quotas in hand; (2) refusal of application for extension of stay of the employee upon expiry of visa; and (3) refusal of application to import labour under the ACP scheme in future.

To conclude, I would assure Members again that we have been proceeding with our investigations into the labour disputes and related problems as a priority task. We are making every effort to improve the effectiveness of the various controls and safeguards under the ACP Scheme. The whole process of our work is open and transparent. We will work closely with concerned Members of this Council, the Manpower Panel and other interested parties during this process. We are open and receptive to any suggestions and advice on how we can improve the operational and monitoring system of the Scheme.

We do not see a need at this stage for this Council to empower the Manpower Panel under section 9 of the Legislative Council (Powers and Privileges) Ordinance to conduct hearings and enquiries into these labour disputes. We are very concerned that this will run the risk of prejudicing the Government's investigation efforts and thus will not be in the interest of the workers or the community as a whole. I would therefore ask Members to consider this motion in the light of my comments and vote against it. In the event this motion is passed, I will urge Members of the Council and the Manpower Panel to await and examine the Administration's detailed investigation report which we will, I repeat, submit in about three months' time before considering whether or not to invoke the Legislative Council (Powers and Privileges) Ordinance to conduct hearings and enquiries.

Thank you.

Separately, we also propose to revise the rates of funeral expenses and medical expenses payable under the Ordinance which have always been identical to those specified in the Employees' Compensation Ordinance. As the rates of such expenses under the Employees' Compensation Ordinance have just been raised by a resolution of this Council, I propose that the levels of these two items be similarly revised.

The proposed have been endorsed by the Labour Advisory board and I recommend them to this Council for approval.

Mr President, I beg to move.

Question on the motion proposed, put and agreed to.

STAMP DUTY ORDINANCE

THE SECRETARY FOR THE TREASURY to move the following motion:

    "That section 29I(1) of the Stamp Duty Ordinance be amended by repealing "31 December 1995" and substituting "31 December 1997"."

He said (in Cantonese): Mr President, I move the resolution standing in my name on the Order Paper.

I would like to first outline the background. In January 1992, Members approved amendments to the Stamp Duty Ordinance (Cap. 117). Among other things, these amendments required stamp duty to be paid on all agreements for sale of residential property. By contrast, stamp duty was previously only payable on the assignment of the property.

This measure was one of a series of actions to curb speculation in residential property. It is a disincentive to those who speculate on property in the period between the conclusion of a sale agreement and the assignment. Apart from the additional stamp duty a speculator has to pay for each sale before assignment, the speculator also has a potential profits tax liability. The information on sale agreements provided to the Commissioner of Inland Revenue under the measure enables him to identify property transactions which may be liable to profits tax. This ensures that the speculators pay a fair share of profits tax. The cost of speculation has therefore been significantly increased. Genuine home-buyers are not affected by this measure except insofar as they have to pay stamp duty slightly earlier.

Under the terms of the original amendments, the measure would have expired at midnight on 31 December 1993. The intention was to allow both the administration and Members the opportunity to examine all relevant factors before deciding whether the measure should be extended. On 15 December 1993, Members approved a resolution to extended the measure for two years until 31 December 1995.

The residential property market has gradually softened. The problem of speculation has now been largely contained. This is the combined effect of measures proposed by the Inter-departmental Task Force on Land Supply and Property Prices, mortgage lending policy of banks, changes in interest rates, as well as the increased cost of speculation as a result of the stamp duty measure. It is therefore important that the stamp duty measure be extended. Otherwise, it would send a wrong signal to the market that the Government no longer wished to curb speculation in residential property. There would also be a significant risk that speculation may be rekindled to the detriment of genuine home-buyers.

The motion before Members today seeks the extension of the measure by a further period of two years beyond 31 December 1995. I am grateful that the Legislative Council Subcommittee formed to study the motion supports the extension of the measure in principle though I understand that there are different views in respect of the period of extension, that is whether the measure should be extended for one year or two years.

It is clear that the measure is effective in containing speculation. It does not affect genuine home-buyers. It has been in place for nearly four years and is well established and accepted by the public. I therefore do not see any reason why we should deviate from our previous practice of extending the measure for two years which may otherwise give a wrong signal to the market in respect of this Council's determination in containing speculation. In fact, we have also informed the Subcommittee that it is our plan to seek the views of Members later on in this session with a view to introducing an amendment to the Stamp Duty Ordinance to make the measure permanent. This will eliminate unnecessary speculation which may otherwise occur each time the expiry date of the measure approaches. The proposed two-year extension would allow Members sufficient time to study the permanent arrangement proposal. However, if the measure were to be extended for one year only and the amendment to the Stamp Duty Ordinance to make the measure permanent could not be processed in time, we might have to seek an extension again before the end of next year, thereby adding an unnecessary burden to the heavy agenda of this Council. I therefore strongly recommend to Members that the two-year extension should be supported.

Finally, I am also grateful to the Members of the Subcommittee for their views on how we should revise the stamp duty system in order to alleviate the financial burden of genuine home-buyers and to safeguard against abuse. I can assure Members that we will examine these views carefully before we submit the permanent arrangement proposal to this Council.

Mr President, I beg to move.

Question on the motion proposed.

PRESIDENT: Mr Ronald ARCULLI has given notice to move an amendment to the motion. His amendment has been printed on the Order Paper and circularized to Members. I propose to call on him to speak and to move his amendment now so that Members may debate the motion and the amendment together.

MR RONALD ARCULLI's amendment to the SECRETARY FOR THE TREASURY's motion:

    "To delete "31 December 1997" and to substitute "31 December 1996"."

MR RONALD ARCULLI:Mr President, I move that the Secretary for the Treasury's motion be amended as set out under my name in the Order Paper. A Subcommittee of 12 Members was formed on 20 October 1995 to study the resolution. I was elected Chairman of the Subcommittee. The Subcommittee held two meetings with the Administration, and I shall highlight two issues which were of concern to the Subcommittee.

The first concern was about the effectiveness of the stamp duty measure and its continued usefulness. While some Members of the Subcommittee agreed with the Administration that the measure could help stabilize the residential price, other Members were not as certain and pointed out that the price of other properties had also been stabilized even though they were not the subject of the same measure. Some Members also cast doubts on the continued usefulness of this measure in the light of the already softened property market and the need to stimulate the local economy.

The second concern was whether the ultimate objective of the measure was to raise revenue or to curb speculation on the residential property market. The Administration told the Subcommittee that the measure had been introduced with the principal aim of helping to curb speculation, although it had also achieved two other equitable results, which were the stamp duty payable on the sale and purchase agreement and that the Commissioner of Inland Revenue could more readily identify property transactions liable to profits tax.

The Administration acknowledged that at the time of introducing the measure, anti-speculation had been the prime factor, but in seeking its extension in the present exercise both factors were important and it was not possible to say which had a greater weight. On this particular point, my own view is that the Administration has in fact changed the stamp duty system, which has since the very beginning charged stamp duty on assignments of residential property. I cannot accept such change for the reasons of raising revenue.

The majority view of the Subcommittee was to support the Administration in seeking an extension of time on the stamp duty measure in principal, yet Members indicated they would have to make an assessment about the impact of the stamp duty measure on the local economic climate before they could decide whether the extension should be for one year, to cover until 31 December 1996, or two years until 31 December 1997.

On 6 December 1995, Mr President, I submitted an amendment to the Administration's resolution, the effect of which is to extend the operation of the relevant section to 31 December 1996 rather than 31 December 1997. I shall set out my reasons for moving such an amendment. Property speculation in the current economic climate is virtually non-existent. Indeed, it can be said that the stamp duty and other measures have achieved their objective some time ago. It must be clear to all of us that steps need to be taken to stimulate the economy and one such step would be the removal of the stamp duty measure. At the very least, the situation should be reviewed after a shorter interval than that proposed by the Administration.

It has often been said that the Hang Seng Index and the property market act as a barometer of our confidence in Hong Kong, and we know that both are substantially below their peaks. Therefore, it cannot be objectionable to extend the stamp duty measure for one year only. I doubt very much whether the Administration will find it necessary to extend its operation for another year, but if it is, the Administration will of course be at liberty to table another resolution at the appropriate time. For now, however, I urge Members to support my amendment so that the existing measure will only be extended until 31 December 1996.

In conclusion, Mr President, I urge Members to give serious consideration to the Administration's stated desire to continue receiving the extra revenue from this so-called anti-speculation measure. The Administration does not need this Council's help to raise surplus revenue. Ultimately, the cost of any extra stamp duty will find its way into the pockets of end-users who will pay for it.

When the Secretary for the Treasury, Mr President, mentioned the two-year extension, the thought just dawned on me as to how many of us will be here in two years' time, so I would urge Members to support my motion so that the control of this measure will remain with Members of this Council.

Mr President, with these remarks, I move that the Secretary for the Treasury's motion be amended as set out in the Order Paper.

Question on the amendment proposed.

MR LEE WING-TAT (in Cantonese): Mr President, the Democratic Party believes that collecting stamp duty on sale and purchase agreements of residential property is an effective measure to curb speculation. That is because suppose two or more sale and purchase agreements have been entered into before the actual assignment of a residential property, stamp duty will be payable for each and every agreement. This measure will increase the costs of speculators without affecting the real users.

At present, property prices have fallen by about 30% compared with those in April 1994 and October 1995, but they are still not affordable by the general public. According to information contained in the Government's written reply given to me last week, in 1985, an ordinary Hong Kong citizen could buy a flat of 500 sq ft in the urban area with only an amount equivalent to 120 times the median monthly wage. Now in 1995, however, the same worker will have to pay an amount equivalent to 190 times the median monthly wage to buy the same flat. Therefore, Mr President, although property prices have apparently fallen, it is only a slight fall from a very high peak and they are still not affordable by the general public, especially the grassroots. In October 1995, about 10% of all property assignments were still short-term assignments. This percentage is only slightly lower than that of what we call the peak which is 22%. Therefore, speculation has not completely disappeared, it has only dampened slightly. Short-term assignments amounting to 22% is certainly an indicator of a lot of speculation at the time, but 10% is still a significant figure.

If anti-speculation measures are immediately relaxed just when there is a fall in property prices, suppressed speculative activities will easily become active again and the ultimate victims will be the real users. Moreover, now that property prices have only fallen slightly, property developers are already feeling anxious and, with the help of our Financial Secretary, they have spread the news that property prices have hit the bottom and promoted the opinion that they will rise again very soon. Many associations of property developers have continuously lobbied the Government to relax the mortgage restrictions. Therefore, now that property prices have fallen, we have to take steps to stabilize the situation. If not, there will be an upsurge of property prices once the anti-speculation measures are relaxed.

If we extend measure to collect stamp duty on sale and purchase agreements of residential property for only a year, then a year later, before the falling trend of property prices has stabilized, speculators will have the chance to enter the market and there will be a revival of speculation. In addition, there will still be a shortage of private housing units in the next two years and less land will be available for urban redevelopment. Relaxing the anti-speculation measure in the face of reduced supply will only lead to an upsurge in property prices.

Therefore, Mr President, we do not agree with the Honourable Ronald ARCULLI's amendment and we will support the Government's motion. Thank you, Mr President.

MR CHAN KAM-LAM (in Cantonese): Mr President, up till now, the Stamp Duty Ordinance has really been effective in curbing property speculation and, therefore, the Democratic Alliance for the Betterment of Hong Kong supports the Secretary for the Treasury's motion to extend the measure to 31 December 1997. Besides, we would also urge the Government to review the present system of stamp duty as soon as possible so that, with the extra revenue obtained under the present system, tax concessions can be given to the real users in the community and the public can be encouraged to own their homes. Thank you, Mr President.

MR EDWARD HO (in Cantonese): Mr President, I remember that in the year in which the stamp duty measure was passed into law, I was Chairman of the Select Committee concerned. At that time, the Government made it clear that the measure was intended to curb property speculation. However, it seems that it has now become one of the Government's ways to grab revenue. Why do I say that?

The Honourable LEE Wing-tat talked about the question of property prices. The present level of property prices is certainly higher than that of 1985 and it is very much higher than that of 1967. There is no need for us to argue what is the level which we would consider it wrong to allow property prices to reach. However, we should be clear that it would not be possible to speculate on new flats at all. That is because with the implementation of the new measure, a flat cannot be sold earlier than nine months before the occupation permit is due to be issued and, after purchase, it cannot be assigned until the occupation permit has been obtained. Therefore, it would not be possible to speculate on new flats. Now, the subject for discussion is the speculation of old domestic units. Would it be possible to speculate on old domestic units? What does "speculation" mean? Speculation means trying to make a profit by means of assignment with very little money, that is, before all the money and costs have been paid. However, to purchase an old domestic unit, the price has to be paid in full, which means it would not be possible to speculate and we also know clearly that there are no speculative activities on property in the market. If we support the Government's motion to extend the measure for two years, we would be supporting the Government to grab revenue by using this method. It is not a question of curbing speculation. Thank you, Mr President.

MR JAMES TO (in Cantonese): Mr President, I would like to briefly respond to the Honourable Edward HO's viewpoints. In fact, I agree that it would not be possible to speculate on new flats. If there are restrictions forbidding any assignment of uncompleted flats before the occupation permit is issued, the question of how many times a new flat can be assigned between the time that a purchase agreement has been signed and the final stage when the assignment is entered into simply does not exit. Here the question is: Would it be possible to speculate on old domestic units.

When purchasing an old domestic unit, one does not necessarily have to pay the price in full because theoretically, the deposit can be set, for instance, at 10% or 20% of the price and then the agreement can be signed. If no stamp duty is payable at this stage, the purchaser and the vendor can decide on a transaction date in the more distant future. Experience shows that speculation does occur in this interim period and a unit can be assigned several times before occupation or before the assignment is entered into.

This measure will not affect the real users adversely. I believe we will agree that this is true if we really want to help the real users, no matter to which political party we belong; unless my honourable colleagues can provide any evidence that this measure will affect the real users adversely, then that will be a different matter. In fact, whether tax concessions and deductions of mortgage interests payable should be allowed and whether the amount and percentage of mortgage loan should be increased will be practical and useful measures for us to discuss now. I believe this measure will not be used to grab revenue, but even if it will, it will only be used to grab revenue from the property speculators and potential speculators, not from the users. Actually, even if this measure does not exist, stamp duty is payable anyway at the final stage when the assignment is entered into.

MRS SELINA CHOW (in Cantonese): Mr President, earlier on, I heard the Honourable James TO mention "theoretically" and, very often, we hear colleagues from the Democratic Party say "theoretically"; I think that is not the way we should consider problems.

In fact, it is not easy to differentiate clearly who are the buyers and who are the users. We have to consider clearly not only the effect of a measure on the buyers, the users or the speculators, but also the effect on the property market as a whole. Earlier on, we heard the Honourable LEE Wing-tat's speech and there is nothing much to it. Basically, he thinks that the property prices at present are not low enough; they should fall even lower and it would be best if they were reduced by half or even more. He only cares for those who want to buy their own flat, but neglects those who have already done so and have lost a fortune because they may have used up all their assets to pay for the deposit.

I believe we are not relaxing the measure. The question is: the Government said that this measure was introduced because there was a problem and that this was a temporary measure to cool off the over-heated property market. If it is temporary, then it should not be extended arbitrarily for two years, for two more years and yet two more years so that it would become a permanent measure to intervene in the market until the price reaches a level which is considered to be acceptable by some. This is not the way in which this measure should work. I am only hoping that we can understand that we are actually intervening in the market. Do we want to adopt this approach as a long-term policy? Alternatively, we can continue to give the market the message that this is actually a temporary measure: when there is a serious problem, certain measures have to be adopted; when the problem is less serious, we do not wish to intervene.

Thank you, Mr President.

MR ALBERT HO (in Cantonese): Mr President, I would like to make only a very short response. First, what is "property speculation"? To put it very simply, it means purchasing a property with a very small outlay and trying to assign it within a certain period of time after a wait-and-see period (there is already an intention of assignment at the time of purchase).

What is the method commonly used? Earlier on, the Honourable James TO has said that after the purchasers have paid the deposit, they would speculate on property by means of assignment. That was the case with the purchase of uncompleted flats in the past and that is still the method used in the speculation of old domestic units. That is not a theoretical situation. As a solicitor who has practised for more than 10 years, I have seen many people doing it. Now, with the introduction of the stamp duty measure, the assignee has to pay the stamp duty for every assignment. I think this is an effective measure to curb speculation and its effectiveness has also been generally acknowledged. Although this measure is still inadequate, the question, as the Honourable Mrs Selina CHOW suggested, is : What will be the result if this measure is cancelled?

Earlier on, Mrs CHOW has mentioned that many people have lost a lot of money as a result of the suppression of property prices and it is hoped that property prices will rise again. I hope that is not what Mrs CHOW meant. I really hope that that is not what she meant. However, we have to be very clear that this is only a temporary measure, though I do not think it will cause any unfairness. We have to emphasize time and again that at present, it is the assignee who has to pay the stamp duty. In fact, it is only fair that stamp duty is payable on every assignment of property rights. Therefore, when the Secretary for the Treasury said that a long-term review has to be carried out, I think that is a good thing. However, in the meantime, we have to spend time to review the situation and we must not give people a wrong message. We will certainly not agree should this be a measure to intervene in the market; but this is in fact a measure to increase the costs of property speculators and a way to obtain money and revenue for the Inland Revenue Department through what we think is a reasonable approach. I do not see any disadvantage and it has not created an unfair situation.

Mr President, I would like to emphasize one last point. Relying on the levy of stamp duty to curb property speculation and to stabilize property prices is not enough, good co-ordination and continued efforts by the Government are also necessary. We certainly do not agree to take any steps at this stage which would give other people a wrong message that the Government intends to relax the measure. Mr President, we support the Government's motion today in the hope that a review can be completed in two years' time so that we will know what steps should be taken in the long run. I therefore oppose the Honourable Ronald ARCULLI's amendment. Thank you.

MR ALLEN LEE (in Cantonese): Mr President, I would only like to point out that perhaps the Honourable Albert HO might have got it wrong; he used the word "cancel" just now but the Honourable Ronald ARCULLI has proposed to review, and not to cancel the measure, after a year. The use of the word "cancel" may mislead Members of this Council.

SECRETARY FOR THE TREASURY (in Cantonese): Mr President, although speculative activities in the property market have now slowed down, this does not mean that we can lower our guard. We must do our best to avoid sending any message which may make the market think that we would gradually relax or even cancel the measure related to stamp duty. In fact, with respect to property transactions which occur before or shortly after the signing of deeds of assignment, this is, cases of property re-sale, although the number has dropped from 16 023 cases in 1993 to 15 184 cases in 1994-95, 5 000 such cases were still recorded in the first six months of 1995-96. For that reason, we believe that there is a great need for the continued implementation of this particular measure. I do not accept the argument that cancelling the measure related to stamp duty can boost the economy. I believe that as far as property speculation is concerned, this will only reduce ......

PRESIDENT: Mr Allen LEE, do you have a point of order? Are you seeking elucidation?

MR ALLEN LEE: Yes.

PRESIDENT: Are you prepared to yield, Secretary for Treasury?

MR ALLEN LEE: The Secretary kept mentioning about cancelling. But Mr ARCULLI is not proposing cancelling. It is an extension to one year. So he has used the word three times already.

SECRETARY FOR THE TREASURY (in Cantonese): Mr President, perhaps the Member could not hear clearly what I just said. I said we should avoid giving any message that would make the market think there would be gradual relaxation or cancellation of this measure. I was only referring to the giving of a message. Allow me to continue with my speech.

I do not agree with the point that cancellation of the stamp duty measure can stimulate the economy. I think this will only cut the cost of the property speculators and indirectly encourage speculation activities on the property market. I have to emphasize that the measure on stamp duty is working well and it does not affect the genuine home buyers. The Honourable LEE Wing-tat has just explained the reason for this. In fact, if there are more speculation activities because of the cancellation of this measure, the cost of the genuine home buyers will be increased. Therefore, I hope Members will support the proposal to extend the stamp duty measure for two years.

Question on the amendment put.

Voice votes taken.

THE PRESIDENT said he thought the "Noes" had it.

Mr Ronald ARCULLI claimed a division.

PRESIDENT: Council shall proceed to a division.

PRESIDENT: I would like to remind Members that they are called upon to vote on the question that the amendment moved by Mr Ronald ARCULLI be made to the Secretary for the Treasury's motion.

PRESIDENT: Will Members please register their presence by pressing the top button in the voting units on their respective desks and then proceed to vote by selecting one of the three buttons below?

PRESIDENT: Before I declare the results, Members may wish to check their votes. Are there any queries? The result will now be displayed.

Mr Allen LEE, Mrs Selina CHOW, Mr NGAI Shiu-kit, Mr LAU Wong-fat, Mr Edward HO, Mr Ronald ARCULLI, Mrs Miriam LAU, Dr LEONG Che-hung, Mr CHIM Pui-chung, Mr Frederick FUNG, Mr Eric LI, Mr Howard YOUNG, Mr James TIEN, Mr Paul CHENG, Mr CHOY Kan-pui, Mr David CHU, Mr Ambrose LAU, Dr LAW Cheung-kwok, Mr Bruce LIU, Mr MOK Ying-fan and Miss Margaret NG voted for the amendment.

Mr Martin LEE, Mr SZETO Wah, Mr CHEUNG Man-kwong, Mr Michael HO, Dr HUANG Chen-ya, Miss Emily LAU, Mr LEE Wing-tat, Mr Fred LI, Mr James TO, Dr Samuel WONG, Dr Philip WONG, Dr YEUNG Sum, Mr WONG Wai-yin, Miss Christine LOH, Mr LEE Cheuk-yan, Mr CHAN Kam-lam, Miss CHAN Yuen-han, Mr Andrew CHENG, Mr CHENG Yiu-tong, Mr Anthony CHEUNG, Mr CHEUNG Hon-chung, Mr Albert HO, Mr IP Kwok-him, Mr LAU Chin-shek, Mr LAW Chi-kwong, Mr LEE Kai-ming, Mr LEUNG Yiu-chung, Mr NGAN Kam-chuen, Mr SIN Chung-kai, Mr TSANG Kin-shing, Dr John TSE, Mrs Elizabeth WONG and Mr YUM Sin-ling voted against the amendment.

THE PRESIDENT announced that there were 21 votes in favour of the amendment and 33 votes against it. He therefore declared that the amendment was negatived.

Question on the original motion put and agreed to.

MEMBER'S MOTIONS

INTERPRETATION AND GENERAL CLAUSES ORDINANCE

DR LEONG CHE-HUNG to move the following motion:

    "That in relation to the -
  1. Civil Aviation (Aircraft Noise) Ordinance (Amendment of Schedule) Notice 1995 published as Legal Notice No. 539 of 1995;
  2. Airport Authority Ordinance (71 of 1995) (Commencement) Notice 1995 published as Legal Notice No. 540 of 1995;
  3. Import (Radiation) (Prohibition) (Amendment) Regulation 1995 published as Legal Notice No. 541 of 1995;
  4. Import and Export (General) (Amendment) Regulation 1995 published as Legal Notice No. 542 of 1995;
  5. Import and Export (Fees) (Amendment) (No. 2) Regulation 1995 published as Legal Notice No. 543 of 1995;
  6. Import and Export (Registration) (Amendment) Regulation 1995 published as Legal Notice No. 544 of 1995;
  7. Ferry Services (Hongkong and Yaumati Ferry Company, Limited) (Determination of Fares) (Amendment) Ordinance 1995 published as Legal Notice No. 545 of 1995;
  8. Leveraged Foreign Exchange Trading (Calls) (Amendment) Rules 1995 published as Legal Notice No. 555 of 1995;
  9. Tax Reserve Certificates (Fourth Series) (Amendment) Rules 1995 published as Legal Notice No. 556 of 1995;
  10. Tax Reserve Certificates (Rate of Interest) Notice 1995 published as Legal Notice No. 557 of 1995;
  11. Prisoners' Education Trust Fund Ordinance (19 of 1995) (Commencement) Notice 1995 published as Legal Notice No. 558 of 1995;
  12. Official Languages (Amendment) Ordinance 1995 (51 of 1995) (Commencement) (No. 2) Notice 1995 published as Legal Notice No. 559 of 1995;
  13. Tax Reserve Certificates (Amendment) Ordinance 1995 (99 of 1995) (Commencement) Notice 1995 published as Legal Notice No. 560 of 1995;
  14. Official Languages (Authentic Chinese Text) (The Hongkong and Shanghai Banking Corporation Limited Ordinance) Order published as Legal Notice No. (C) 115 of 1995;
  15. Official Languages (Authentic Chinese Text) (Tramway Ordinance) Order published as Legal Notice No. (C) 116 of 1995; and
  16. Official Languages (Authentic Chinese Text) (Peak Tramway Ordinance) Order published as Legal Notice No. (C) 117 of 1995,

and laid on the table of the Legislative Council on 6 December 1995, the period referred to in section 34(2) of the Interpretation and General Clauses Ordinance for amending subsidiary legislation be extended under section 34(4) of that Ordinance until 10 January 1996."

DR LEONG CHE-HUNG: Mr President, I move the motion standing in my name on the Order Paper on behalf of the House. The motion seeks to extend the scrutiny period for the 16 items of subsidiary legislation tabled in the Council on 6 December 1995. As there is no sitting of the Legislative Council between 13 December 1995 to 10 January 1996, the deadline for Legislative Council intervention for these items of subsidiary legislation will fall on 3 January 1996 when there is no sitting.

In order to preserve Members' rights to amend any of these items, it is necessary to move an extension resolution to extend the period for intervention until 10 January 1996.

Mr President, I beg to move.

Question on the motion proposed, put and agreed to.

LEGISLATIVE COUNCIL (POWERS AND PRIVILEGES) ORDINANCE

MR LAU CHIN-SHEK

to move the following motion:

    "That for the purposes of enquiring into the circumstances surrounding the recent labour disputes involving imported workers under the Special Labour Importation Scheme for the Airport Core Programme Projects and related issues, the Legislative Council Panel on Manpower be authorized under section 9(2) of the Legislative Council (Powers and Privileges) Ordinance (Cap. 382) to exercise the powers conferred by section 9(1) of that Ordinance."

MR LAU CHIN-SHEK (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

Recently, labour disputes involving foreign workers of the airport projects have aroused much public concern, especially in relation to accusations of wage deductions and payment delays. In order to have an in-depth discussion of the matter, the Legislative Council Panel on Manpower held a special meeting on 5 December this year. Upon hearing the Administration's report on the labour disputes, the Panel was greatly shocked and disturbed about the unfair treatments received by the foreign workers. Although the Labour Department has stepped up its monitoring and enforcement efforts, the result is still disappointing. The Panel thinks that in order to assess the effectiveness of the new steps that have been taken or will be taken by the Government to protect the interests of foreign workers, it is necessary to understand the various arrangements for the importation of foreign labour, the role of the labour affairs companies and the extent of the contractors' responsibility. While the Government may conduct inquiries into individual cases on other aspects, the Panel thinks that it is necessary to conduct an in-depth inquiry in order to achieve the following aims:

  1. To understand the present procedures for the importation of labour and the circumstances under which wages are deducted and payments delayed;
  2. To assess whether the legislation enacted and the administrative measures adopted with a view to implementing and monitoring the Labour Importation Scheme are effective or not;
  3. To assess whether the new measures proposed by the Administration to control unlawful acts are effective or not;
  4. To put forth feasible means to strengthen the supervision, especially that of the Labour Importation Scheme; and
  5. To identify persons responsible for any unlawful acts.

In conducting this inquiry, the Panel on Manpower has to ask the parties concerned to provide evidence and relevant documents, but such parties may refuse to attend the inquiry or invoke the Legislation (Powers and Privileges) Ordinance for protection. In the circumstances, we have to ask this Council that the Panel be authorized under section 9(2) of the Legislative Council (Powers and Privileges) Ordinance to exercise the powers conferred by section 9(1) of the Ordinance. The Panel on Manpower, having submitted a report to the House Committee and obtained its support on 8 December, proposes the motion in this Council today. Now, I shall formally move the motion that the Legislative Council Panel on Manpower be authorized under section 9(2) of the Legislative Council (Powers and Privileges) Ordinance to exercise the powers conferred by section 9(1) of that Ordinance.

Mr President, with these remarks, I move the motion. Thank you.

Question on the motion proposed.

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, the recent outbreak of labour disputes on Airport Core Programme (ACP) work sites is a matter of serious concern to the Government. I should like to assure Members that a thorough investigation into each of the cases is being conducted. Hong Kong is a civilized society where the rule of law is paramount. We will not tolerate abuse of imported workers and will instigate prosecutions against those who may have breached the laws of Hong Kong. We fully appreciate Members' understandable concern about such cases and their desire to get to the truth to find out what went wrong and who is responsible. We share these sentiments entirely. However, it is not necessary nor appropriate for the Council to confer on the Manpower Panel the power under section 9 of the Legislative Council (Powers and Privileges) Ordinance to conduct an enquiry into the circumstances surrounding the labour disputes for the following reasons.

First, these labour disputes are already under investigation by the law enforcement agencies. The Labour Department has been making good progress in its investigations. In some of these cases, the investigations are at an advanced stage. Prosecutions relating to breaches under the Employment Ordinance are being considered in most of the disputes and hearings for the contractors and subcontractors involved have been arranged for this purpose. These hearings are an integral part of the due process which must be observed before taking a final decision on whether or not to lay charges. These investigation procedures are likely to be affected if the Manpower Panel of this Council is to conduct a parallel inquiry into the disputes. The use of the Legislative Council (Powers and Privileges) Ordinance whether to summon persons involved in the dispute or to ask for documents relating to the disputes will run the serious risk of delaying or jeopardizing our inquiries. I am sure Members would not wish to see this happen.

The Immigration Department is investigating into the various dispute cases to see if there are any offences under the Immigration Ordinance. The police are also at present investigating six constructions sites in connection with the recent labour disputes to ascertain whether any person has breached the law. Before these investigations are completed, any action taken by the Legislative Council to invoke the powers under the Legislative Council (Powers and Privileges) Ordinance to enquire into the circumstances of the cases may prejudice the outcome of such investigations. Any discrepancies in the statements and testimony of the same witnesses called by the police, the Immigration Department and the Panel, and the premature release of documents or evidence in connection with the cases possessed by the law enforcement agencies may impede the progress of our investigations and may adversely affect the chance of subsequent prosecutions.

Secondly, we have been in contact with the New China News Agency and are working with the relevant Chinese authorities with a view to improving communication and co-operation particularly in respect of the operation of and the legal charges imposed by the Chinese labour service companies to ensure that imported workers from PRC are aware of their rights and benefits, and to safeguard them from being exploited. I understand that the Chinese authorities have already set up a special team to investigate at their end the complaints about wage deductions. There is therefore no urgent need for this Council or the Manpower Panel to carry out an enquiry at this stage. Indeed, Members should await the outcome of the efforts by both Governments before deciding whether any further action is warranted.

As an open and accountable Government, we fully acknowledge that the public has the right to know more about the causes of and the results of our investigations into the current labour disputes. We have no intention of hiding the truth from members of the public. I intend to present to this Council in about three months' time a detailed report on the results of all our investigation efforts. This report will not only set out the outcome of investigations in Hong Kong, but will also include information about the role of the labour service companies and the result of our liaison efforts with the Chinese authorities. This will enable both Members and the general public to have a full picture of the problems involved, their causes, the effect of the various remedial measures we have recently taken and any further recommendations we may put forward to enhance the integrity of the system. Members will be given ample opportunity to discuss and raise questions on this report.

I personally led the team of officials and senior representatives of the Airport Authority (AA) and MTRC to answer questions on the ACP labour disputes at the Special Manpower Panel Meeting on 5 December 1995. My colleagues and I, including the authorities concerned, AA and MTRC, are very much prepared to continue to co-operate fully with the Manpower Panel without prejudice to our investigations. The exercise of the Legislative Council powers and privileges, if targeted at the Administration and the other institutions mentioned above, is absolutely unnecessary.

We have already provided information to the Manpower Panel on the nature of the recent labour disputes. I do not wish to repeat here. However I would like to reiterate that we have already added new conditions to strengthen our monitoring system to minimize the possibility of abuse of the scheme. With effect from 1 November 1995, employers are required to: (1) give a copy of employment contract to his imported workers; (2) provide them with details of their monthly earnings; (3) provide them with a monthly statement showing all transactions of their bank accounts. Within eight weeks upon the arrival of an imported worker in Hong Kong, the employer is required to grant him paid leave to enable him to attend briefings on his statutory rights as an employee under Hong Kong labour laws and his contractual rights under the employment contract. On top of these measures which are already in force, we intend to require employers to give an undertaking to the Labour Department that the imported workers have received a copy of the employment contract specifying the post and amount of wages before they come to Hong Kong. Officers of the Immigration Department will ask the imported worker to present his employment contract for inspection purpose shortly upon their arrival in Hong Kong.

I would like to assure this Council once again that we do not and will not tolerate any abuse of imported workers. We are committed to upholding the integrity of the ACP Labour Importation Scheme. Malpractices by a few threaten the good name of other law-abiding employers and the good name of Hong Kong. We are fully committed to do everything within our power to combat abuses and malpractices. Labour Inspectors of the Labour Department conduct regular inspections to the places of work of imported workers to check whether provisions under the Employment Ordinance and the Employees' Compensation Ordinance have been complied with and to guard against other abuses which constitute breaches of the conditions under the Scheme.

I would also like to make clear, once again, that without prejudice to any prosecutions under the laws of Hong Kong, employers who are found to have contravened conditions of the scheme will be liable to: (1) withdrawal of quotas in hand; (2) refusal of application for extension of stay of the employee upon expiry of visa; and (3) refusal of application to import labour under the ACP scheme in future.

To conclude, I would assure Members again that we have been proceeding with our investigations into the labour disputes and related problems as a priority task. We are making every effort to improve the effectiveness of the various controls and safeguards under the ACP Scheme. The whole process of our work is open and transparent. We will work closely with concerned Members of this Council, the Manpower Panel and other interested parties during this process. We are open and receptive to any suggestions and advice on how we can improve the operational and monitoring system of the Scheme.

We do not see a need at this stage for this Council to empower the Manpower Panel under section 9 of the Legislative Council (Powers and Privileges) Ordinance to conduct hearings and enquiries into these labour disputes. We are very concerned that this will run the risk of prejudicing the Government's investigation efforts and thus will not be in the interest of the workers or the community as a whole. I would therefore ask Members to consider this motion in the light of my comments and vote against it. In the event this motion is passed, I will urge Members of the Council and the Manpower Panel to await and examine the Administration's detailed investigation report which we will, I repeat, submit in about three months' time before considering whether or not to invoke the Legislative Council (Powers and Privileges) Ordinance to conduct hearings and enquiries.

Thank you.

MR TSANG KIN-SHING (in Cantonese): Mr President, on 26 September this year, a strike took place involving 800 Thai workers of the Route 3 and airport projects over wage deductions. From that day, until November this year, there were altogether seven cases in which the wages of the foreign workers of the new airport projects had been deducted. More than 2 000 workers, representing half of the total number of foreign workers in the new airport projects, were involved in these cases. They were Filipinos, Thais and Chinese by race. I do not wish to argue with the Secretary for Education and Manpower over what he said earlier about China, but in fact the countries involved included the Philippines and Thailand.

I have taken an active part in dealing with the wage deduction cases involving foreign workers, helping them fight for their reasonable interests. In the course of my involvement, I have come to understand that this is a modern version of the story of marketing labour to be exploited. I think that our policy of importation of labour has attracted workers form nearby countries to Hong Kong, only to be exploited by various parties. They might have regretted coming to Hong Kong, but they still could not avoid paying back the debts owed to the so-called labour affairs companies an other persons in their native countries. This is because they are bound by contracts into which they have entered. In the circumstances, they have no choice but to bear with the exploitation and work patiently.

Such were not cases which happened in the 19th century when Chinese labour was marketed to San Francisco to be exploited as railway workers. They actually happened in the 20th century in connection with the Airport Core Programme of Hong Kong. As a citizen of Hong Kong, I think that is really shameful.

The Democratic Party is of the opinion that wage deductions are directly related to the implementation of the policy of the importation of labour. The present circumstances have shown that the Government is not able to control the incidents of exploitation. In view of this, we think that the Legislative Council should follow up the cases and inquire into the matter so as to do justice to the people of Hong Kong and review the work done by Government departments.

The Democratic Party thinks that an inquiry into the cases of wage deductions should be conducted without further delay. The Secretary for Education and Manpower said that it would take three months, but we can imagine what the situation would be during the Chinese New Year holidays in Hong Kong in about a month's time. Many of construction sites will be closed and it is common for workers, especially the Chinese workers, to return home for the holidays. However, many people are worried that they cannot come back to Hong Kong after they have returned home. In the past, workers who had gone on strike were repatriated from Hong Kong to their native countries by the so-called labour affairs companies. Therefore, the Democratic Party urges the Legislative Council to invoke the Legislative Council (Powers and Privileges) Ordinance to conduct an open inquiry into the matter. This will not only serve to redress the grievances of the foreign workers, but also make the people of Hong Kong more aware of the loopholes of the policy of the importation of labour and of the role of the Government. The Democratic Party will take an active part in the inquiry, so as to find out the truth and do justice to the people of Hong Kong.

The Democratic Party hopes that Members of this Council will take the same stance and lend their full support to the Panel on Manpower to invoke the Legislative Council (Powers and Privileges) Ordinance to conduct the inquiry.

These are my remarks.

DR PHILIP WONG: Mr President, as a member of the Airport Authority, I wonder if I should declare interest. Can you give a ruling? And if so, may I have your permission to vote?

PRESIDENT: I do not see any direct personal pecuniary interest involved.

MR IP KWOK-HIM (in Cantonese): Mr President, the recent incident of wage deductions concerning the foreign labour of the Airport Core Project has really aroused much public concern in Hong Kong. It is understandable that my colleagues in this Council have demanded to follow up the case by making an inquiry into the matter. The Democratic Alliance for the Betterment of Hong Kong (DAB) also agrees that the matter should be followed up.

We notice that the Chinese Government is very concerned about this incident of exploitation of the foreign labour. Mr ZHANG Liang-dong, Secretary for Economic Affairs of the Hong Kong and Macau Affairs Office, has said that in the 1990s of the 20th century, marketing of labour to be exploited which occurred about a century ago should not happen again. To tackle the present problems, including wage deductions and the poor living environment of the foreign labour, the department concerned in China is planning to set up an investigation unit which will first inquire into the labour affairs companies in the two provinces of Guangdong and Fujian. Last month, the central authorities also held a joint meeting in which a demand was made for the authorities of the two provinces of Guangdong and Fujian to find out the reasons for the strike of the foreign labour in Hong Kong and to submit a report to the central authorities. Furthermore, Mr TSANG Yuk-shing and Mr TAM Yiu-chung, Chairman and member of the DAB respectively, after meeting with the officials of the Secretariat for International Co-operation, Ministry of Foreign Trade, have been given to understand that the Chinese Government is planning to step up the control of the labour affairs companies by means of legislation in order to plug up the present loopholes of the administrative rules to control the companies.

Earlier, I heard the Government's commitment to inquire into the matter and to produce a report after three months which will identify the loopholes of the present operation of the Labour Importation Scheme of the Hong Kong Government, make suggestions of improvement and introduce ways to monitor the agents for the importation of foreign labour. The report will be submitted to the Legislative Council.

Now that both the Governments of China and Hong Kong have started making inquires into the matter, should this Council use resources at this time to serve an overlapping purpose? Or would it be more appropriate for us to consider whether to hold an inquiry after the Government has submitted the report in three month's time? These are my remarks.

MR FREDERICK FUNG (in Cantonese): Mr President, the Hong Kong Association for Democracy and People's Livelihood (ADPL) supports the Honourable LAU Chin-shek's motion because we think that, for many years, there has been much controversy in Hong Kong over the issue of the importation of foreign labour. Such an issue is by no means a recent one. During the past few years, we have expressed the concerns of the public and of Members of this Council and we have also given advice in this Council. On every occasion, the replies given by the Government in this Council was that things could be accomplished and there would be no problem, but problems have at last arisen. The recent disputes have provided us with an insight that despite all the information, data, methods of implementation and systems revealed by the officials, the Government has been unable to accomplish what they promised to accomplish. In any case, not enough has been done. As members of the Legislative Council, we have given our support to the work of the Government, we have allocated funds for the Government to do its work and we have also approved staff increase, especially in the Labour Department, to deal with the problems of foreign labour.

Now that problems have arisen, I think there are at least four points which we members of the Legislative Council have to attend to and which we have to find out more through the Panel on Manpower.

We demand the Panel be authorized to exercise powers and privileges. We wish to achieve the following:

  1. understand the whole issue, but we have to make it clear that we are not demanding to investigate the case. We have to understand what has happened and why things have come to this situation.
  2. We have to understand the system which the Government has established, because the operations in the past could neither give protection nor prevent such disputes form happening, thereby causing problems. We have to stress that we are only trying to understand the system but not to find out who is responsible and who should bear the responsibility.
  3. We want to understand the situation and the present system because we wish to give advice and make recommendations concerning the present system with a view to solving the present problems.
  4. We want to examine the problems with the Government's entire monitoring system over foreign labour so as to enable us to give advice accordingly.

Therefore, I do not understand why we should not try to understand the problems and make recommendations accordingly.

Earlier, the Secretary for Education and Manpower told us that government departments such as the Immigration Department and the police might be carrying out investigations and preparing reports and that they might even institute prosecutions. But will the work of the Panel affect them? I think it can be left for the Panel to decide in its meetings whether we should exercise the powers immediately or postpone the exercise of such powers after considering the reasons given by the Government and the prevailing circumstances. In the Alex TSUI's case, we did postpone the exercise of such powers. I notice that Members of the Legislative Council do not share the worries of the Government officials who think that we would, regardless of the correspondences, force the Government into a corner so that it cannot move at all.

Finally, I would like to mention one point. We would certainly welcome the great amount of efforts made by the Chinese Government and the local governments of China and we would certainly welcome the Democratic Alliance for the Betterment of Hong Kong to influence some of the policies of China through its many contacts and connections. But we think the Government of Hong Kong and the legislature of Hong Kong can handle local problems. As regards overseas problems, we think they should be dealt with by the overseas governments or the governments concerned. Coming back to the question, should the local Government and the local legislature deal with these problems? And do they have to deal with them? I think they should do so and have to do so. The more active the Chinese Government deals with the matter, the more active we should be because it is a matter of co-ordination. I do not think that such co-ordination should be left to the executive. Since the legislature has such powers and responsibilities, it should deal with the matter. I therefore support Mr LAU Chin-shek's motion.

MR JAMES TO (in Cantonese): Mr President, having taken part in two enquiries conducted by this Council through invoking the Legislative Council (Powers and Privileges) Ordinance, I would like to respond to the Secretary for Education and Manpower on some technical points.

The Secretary for Education and Manpower just now said that he was very worried. He even pointed out that the normal investigation would be hindered if witnesses were summoned by this Council to attend an enquiry held under the said Ordinance. He cited two concrete examples. Firstly, he pointed out that if the witnesses to be summoned to appear at a hearing of this Council were the same as those who had been summoned to a court or police station, then the outcome might be prejudiced should different testimonies were given on different occasions. However, the Secretary seemed to have failed to further explain what problem would be resulted from such discrepancies.

In response to the Secretary's opinion, I would ask a question: Should the same witness give two different statements, especially when he is under oath on both occasions? If two different statements are given by the same witness, then logically, whether he is a government official or a man in the street, the Government should investigate to see whether someone has committed perjury on some occasion. Further investigation might be needed. In such a case, it will not affect the appropriateness of the questions raised by the Legislative Council or a court of law. Moreover, there is safeguard provided by the Ordinance that evidence given at this Council cannot be availed of in any other legal proceedings, regardless of whether it is self-incriminating, unless the Attorney General is considering to prosecute the witness or this witness has committed perjury in an enquiry conducted by this Council. Logically, these are the exceptions. Other than that, the evidence given is not allowed to be used for other purposes. In the circumstances, the Council has to grasp all the facts which will be our basis for monitoring the Government or for future legislation purpose. Thus we do not see any reason why there will be adverse influence caused by summoning the same witnesses, who have testified in a court for the same incident, to attend this Council's enquiry.

Secondly, the problem is about the so-called premature release of documents. The Secretary did use the words "premature release of documents". Should there really be such a document whose influence is far-reaching, please do have confidence in the Legislative Council, as we have invoked the Ordinance on two previous occasions. Everybody knows that we will exercise caution and will seek a lot of legal advice before we invoke the Ordinance. Should there be any problem, I believe the Government will provide us with legal advice and will remind us of the possible implications on legal proceedings. At the same time, legal advisors of the Legislative Council will also advise us. I would emphasize that the enquiry conducted by this Council is really of different nature from investigations conducted by different departments or the law enforcing arms of the Government. What the Members want to do is to find out shortcomings within the system rather than with an eye to prosecute the law breakers by invoking the existing laws.

In the past, we had conducted an enquiry for the incident at Kwun Lung Lau. At that time, the Government was also investigating the incident. It was possible that some people might have to bear criminal or civil liabilities. Yet this Council was not stopped from conducting an enquiry by the Government for that reason. Furthermore, the Legislative Council has refrained from invoking this power in a number of important incidents. Whenever this power is invoked, prudence will be exercised. May I cite an example. Teargas was used by the Correctional Services Department or the police in two riots involving the Vietnamese boat people. It was said that deaths and severe injuries were caused. In these incidents, the Governor handled the situation in a wise manner because he was aware that these were important incidents catching the attention of the international community and might lead to disgrace to Hong Kong people. Thus, he immediately appointed some Justices of the Peace to look into the matters or commissioned an independent committee to investigate the incidents. But this time, the Government is handling the problem in a clumsy way. The Government should have responded by appointing an independent committee for this would at least earn more votes in this Council. However, if the Government insists that the problems with the system could be solved by referring the incident to the Immigration Department or the police, I believe no responsible Member will agree to it.

I must also point out that the Government's viewpoints as mentioned above should be rebutted. I hope Members will support this motion and work together to get down to the truth in order to avert unnecessary criticisms that Hong Kong will suffer because of this incident.

MR JAMES TIEN (in Cantonese): Mr President, the Liberal Party supports the Honourable LAU Chin-shek's motion. Our objectives may be the same in some aspects but different in other aspects. It is our common objective, however, to find out who are responsible for the wage deductions. We see eye to eye on this point. But from another point of view, Mr LAU may want to scrap the Importation of Labour Scheme for the New Airport and Related Projects or even all kinds of labour importation schemes through the conducting of this enquiry. From the point of view of the Liberal Party, we want to find out any shortcomings in this system and to see whether the employers, especially those foreign-based contractors, many have paid the wages but the wages do not go to the pocket of the workers. What we want to know is the problem within this process.

Mr President, the importation of labour scheme has been implemented in Hong Kong for a long period of time. Minor problems are inevitable. But in this incident, although the number of companies involved is small, the number of people affected is a great one, involving hundreds of people. In view of this, we want to know why this has happened. It is incredible that the internationally renowned contractors would illegally deduct wages from the workers. So we support the proposal of conducting a hearing in order to get a thorough understanding. Should there be any loopholes, we hope to improve upon them so that our labour importation scheme will continue to operate for the early completion of our new airport. Thank you, Mr President.

MR CHAN KAM-LAM (in Cantonese): Mr President, the public is undoubtedly discontented with the incident that wages of our imported workers have been withheld. Fortunately, the incident has almost been fully settled.

Although I do not have any strong view in regard to the Honourable LAU Chin-shek's motion, I must point out that should the Panel on Manpower be authorized to exercise such powers, we must exercise them with caution. Any attempt to override the investigation being conducted by the law enforcing departments or to abuse the powers and privileges enjoyed by the Legislative Council will be improper.

In my opinion, the Panel on Manpower should respect the independence of the government department in conducting the investigation concerned.

Thank you, Mr President.

MR MICHAEL HO (in Cantonese): Mr President, the Secretary for Education and Manpower had just now emphasized time and again in his speech that it would be unnecessary for this Council to conduct an inquiry. He also told us that the Government was investigating the matter, repeatedly saying that our inquiry might affect the normal procedures and obstruct the investigation. Moreover, the Secretary also mentioned that the Immigration Department would find out in how many of the cases had offences actually been committed. Here I would like to point out that the Immigration Department will only be inquiring into cases which have contravened the Immigration Ordinance and the Labour Department's investigation will mainly be concerned with whether anyone has contravened the labour laws. A case which has neither contravened the labour laws nor the Immigration Ordinance may fall outside the terms of reference of the Immigration Department and the Labour Department.

I hope we can examine the whole system of importation of foreign labour and find out whether there are any shortcomings. That is the responsibility of the Legislative Council of Hong Kong towards the people of Hong Kong.

The Secretary for Education and Manpower said that its investigation might be affected if documents and evidence were prematurely disclosed. He mentioned many other similar presumptions. Mr President, I wish to tell the Government that it does not have to worry. In fact, we have already conducted two similar investigations. This legislature is one which works with reasons and we would certainly be careful, but we would also thank those who remind us to consider certain matters. Therefore, I wish to tell the Government to forget about the presumptions. We do appreciate that the staff of the Labour Department and the Immigration Department have made a lot of efforts and they have done a lot of hard work on the airport construction sites. Many of them have worked overtime, or have even worked so hard that they have become sick. I believe colleagues of this Council understand very well that these people have worked very hard.

Concerning the policy of importation of foreign labour, we realize that there have been incidents of exploitation. This clearly shows that there are problems in the monitoring mechanism. As a monitoring authority, we are responsible for problems in monitoring. Earlier today, I have spoken with some Government officials and they tried to convince us that this inquiry was unnecessary. They told us that even under a good system, there are bound to be people who would make use of the loopholes and exploit others, just like there would still be thieves even though we have the police. However, upon seeing the thieves, we would certainly question the authority responsible for security. Similarly, in this incident, no matter how well the mechanism has been designed, we will question what is the problem with the whole system and what is the problem with the monitoring system once incidents of exploitation have occurred. I am very pleased that investigation is being carried out by the Government as well as the Chinese Government. Although such investigation is somewhat overdue, it is better than nothing.

The Honourable IP Kwok-him said we could wait, but I think that my colleagues here who have become Members of the Legislative Council through elections are representatives of the people of Hong Kong. As such, we are responsible to sort matters out when there is a problem with the systems of Hong Kong. If we leave it to the Government to investigate and if we only invite the Chinese authorities and the Chinese Government to investigate, then we have not fulfilled our responsibilities.

Mr President, today I hope that my colleagues would lend their support to this motion so that we can invoke the Legislative Council (Powers and Privileges) Ordinance to inquire thoroughly into the matter to account to the public of Hong Kong.

These are my remarks.

MR LAU CHIN-SHEK (in Cantonese): Mr President, since the occurrence of the modern version of marketing labour to be exploited, my colleagues and I have mentioned time and again that this incident has brought shame on the people of Hong Kong. Talking about shame, I would like to tell Members that the shame brought on the Hong Kong people may be great or small. Some feel that it is abstract and others feel that it is concrete. Some feel that it may go on for just one or two days while others feel that it would last for a long time. However, considering the sufferings and unpleasant experience of the victims, that is the exploited foreign workers, the shame we face actually reminds us of our responsibility.

What has deeply impressed me is that almost all imported workers of the airport projects have told me that they regret having come to work in Hong Kong. I think you are well aware of the whole procedure and I am not going to repeat it. As we are confronted with this incident today, I would like to point out that many labour organizations have been complaining to the Government as well as some government-related organizations that there are many problems, such as illegal deductions of the wages of foreign workers. The Honourable Frederick FUNG has already given us details about this. But the Government told us that it had already done something to improve the situation and that we can set our mind at ease for there will be no problem. But just let us look at the result!

I want to point out that the problem exposed this time is not discovered by the Government. Not a single problem has been discovered by the Government. They are exposed by the imported workers themselves or by some labour organizations. The Secretary for Education and Manpower has said that what we propose to do would affect the prosecution process. But I would like to remind him that we also have legal advisors who will advise us what we should do. Moreover, the Panel will exercise great caution. But most importantly, as the Government is the policy maker as well as the organization which implements it, the Government itself is the root of the problem. The Government said that investigation had been completed, but is it all that it should do? I am not saying that investigation is not appropriate, but I think the Government should also allow this Council to conduct an objective and unprejudiced enquiry into this matter.

Finally, this incident reminds me of a Jewish friend who told me that when he was on his way back to Israel, he witnessed the miserable plight of the Palestinians. As a result, he decided to stay there to help them despite their political, religious or even economic and cultural differences. Today, confronted with the situation of these unfortunate imported workers in connection with the airport projects. Members of this Council are duty-bound to offer their help, regardless of our standpoint in politics, religions, cultural and economic issues, in the hope that such incidents will not occur again and that our policy can really be implemented in a fair manner.

Mr President, with these remarks, I would like to express my thanks to all Members, whether they will vote for or against my motion or will even abstain from voting.

Question on the motion put.

Voice votes taken.

THE PRESIDENT said he thought the "Ayes" had it.

Dr Philip WONG claimed a division.

PRESIDENT: Council shall proceed to a division.

PRESIDENT: I would just like to remind Members that they are now called upon to vote on Mr LAU Chin-shek's motion. Will Members please register their presence by pressing the top button in the voting units on their respective desks and then proceed to vote by pressing one of the three buttons below?

PRESIDENT: Before I declare the results, Members may wish to check their votes. Are there any queries? The result will now be displayed.

Mr Allen LEE, Mrs Selina CHOW, Mr Martin LEE, Mr SZETO Wah, Mr Edward HO, Mr Ronald ARCULLI, Mrs Miriam LAU, Mr Albert CHAN, Mr CHEUNG Man-kwong, Mr Frederick FUNG, Mr Michael HO, Dr HUANG Chen-ya, Miss Emily LAU, Mr LEE Wing-tat, Mr Fred LI, Mr Henry TANG, Mr James TO, Dr YEUNG Sum, Mr Howard YOUNG, Mr WONG Wai-yin, Miss Christine LOH, Mr James TIEN, Mr LEE Cheuk-yan, Mr CHAN Wing-chan, Miss CHAN Yuen-han, Mr Andrew CHENG, Mr CHENG Yiu-tong, Mr Anthony CHEUNG, Mr Albert HO, Mr LAU Chin-shek, Dr LAW Cheung-kwok, Mr LAW Chi-kwong, Mr LEE Kai-ming, Mr LEUNG Yiu-chung, Mr Bruce LIU, Mr MOK Ying-fan, Miss Margaret NG, Mr SIN Chung-kai, Mr TSANG Kin-shing, Dr John TSE, Mrs Elizabeth WONG and Mr YUM Sin-ling voted for the motion.

Mr CHIM Pui-chung, Dr Philip WONG, Mr CHOY Kan-pui, Mr David CHU, Mr Ambrose LAU and Mr LO Suk-ching voted against the motion.

Dr LEONG Che-hung, Mr Eric LI, Dr Samuel WONG, Mr CHAN Kam-lam, Mr IP Kwok-him and Mr NGAN Kam-chuen abstained.

THE PRESIDENT announced that there were 42 votes in favour of the motion and six votes against it. He therefore declared that the motion was carried.

PRESIDENT: I have accepted the recommendations of the House Committee as to the time limits on speeches for the motion debates and Members were informed by circular on 11 December. The movers of the motions will have 15 minutes for their speeches including their replies and another five minutes to speak on the proposed amendment. Other Members, including the mover of the amendment, will have seven minutes for their speeches. Under Standing Order 27A, I am required to direct any Member speaking in excess of the specified time to discontinue his speech.

REDUCTION OF EMISSIONS FROM DIESEL VEHICLES

MRS MIRIAM LAU

to move the following motion:

    "That this Council supports that measures be taken to reduce emissions from diesel vehicles, but as both petrol and diesel vehicles attribute to air pollution and before it can be confirmed which one of the two types of vehicle is more environment-friendly, urges the Government to review the mandatory scheme of phasing out diesel vehicles of four tonnes or below in the consultation paper "Further Proposals to Reduce Emissions from Diesel Vehicles" and to replace the proposed scheme with incentive measures to attract owners of diesel vehicles to change to petrol vehicles on a voluntarily basis, as well as to expeditiously explore other measures which are more effective and generally accepted by the public, in order to improve the air quality in the territory."

MRS MIRIAM LAU (in Cantonese): Mr President, I move the motion standing in my name as set out in the Order Paper.

In September this year, the Government published a consultation paper which proposes the diesel-to-petrol scheme offering concessions to the trade in order to encourage operators of diesel vehicles of four tonnes or below to switch to petrol. Apart from that, stringent emissions controls against heavy diesel vehicles will be exercised. It is considered that the public and the trade would welcome the Government's endeavours to improve air quality, to protect the public health and to cope with the loss that the operators of diesel vehicles may suffer under this scheme, but ever since the commencement of the consultation period has begun, different opinions have been aired and no unanimous conclusion could be drawn. What is more, voices of opposition from the affected trade is lingering in our ears.

The ultimate purpose of my motion today is the in line with the Government's objective, that is, to improve the air quality of Hong Kong and to protect public health.

The Government has been warning that the respirable suspended particulates (RSP) emitted by vehicles running on diesel is often exceeding the acceptable level and RSP may lead to various kinds of respiratory illnesses and even cancer. The Government also quoted a report from a United Kingdom newspaper that the RSP has caused death of tens of thousand of people a year. It seems to imply that those who do not support the Government's proposal should be held responsible for the death of these people.

In fact, the RSP is only one of the numerous harmful substances emitted by vehicles. Emissions by diesel vehicles contain more particulates and nitrogen oxides, while emissions by vehicles running on petrol contain more carbon monoxide, carbon dioxide, and benzene, which may cause cancer. Since the diesel vehicles and petrol vehicles emit different pollutants which are harmful to the environment and posing a health hazard to us, some academics find that there is no clear conclusion whether diesel or petrol is more environmental friendly.

However, it is the Government's foregone conclusion that petrol is more environmental friendly than diesel. The Government admits that by switching to petrol harmful pollutants in the air will increase but insists that such pollutants can be kept at a safety level. Unfortunately, apart from some homemade charts explaining the Government's views, there is no further substantiation such as academic report and research literature to support its argument or to rebut the academics' conclusion drawn from their study.

If other pollutants are ignored and only suspended particulates are the only pollutant to be dealt with, the Government can feel justified and confident to target at diesel vehicles. However, according to a research report by the Hong Kong Polytechnic University, the emissions of taxis and public light buses in the busiest areas only account for 23.5% of the particulates found in those areas. Besides, according to another research report by the Hong Kong University, particulates emitted by heavy vehicles and big buses account for a great proportion while particulates emitted by taxis and small buses only account for a small proportion.

These two research reports have coincidentally pointed out that the main culprit of emitting a large amount of particulates is not taxis, small buses or light diesel vehicles. However, the Government is targeting at diesel vehicles of four tonnes or below and force them to switch to petrol. What the Government is doing is obviously putting the cart before the horse and reflects that it lacks a sense of proportion.

Even though the Government's proposal can really lead to reduction of suspended particulates in the air, can the people breathe fresh air once the proposal is implemented? Certainly not, because when the problem of suspended particulates has been solved, another pollution problem will emerge. After the diesel vehicles have switched to petrol, the number of cars running on the road will not decrease. In the future, there will be the same number of petrol vehicles running the same mileage that the diesel vehicles are now running. Harmful emissions will also be produced by these vehicles. If suspended particulates may cause death, carbon monoxide and benzene are also lethal, though the cause of death is different.

The Government has emphasized time and again that all problems can be resolved once petrol vehicles are fitted with catalytic converters. But will all pollutants emitted by petrol vehicles disappear? Certainly not. The Government also admits that some air pollutants will increase, but nevertheless will be kept within the safety level. Although mandatory renewal of catalytic converters will be part of the Government's proposal, no one can guarantee that catalytic converters will not be out of order. Neither is there any research to show that the performance of catalytic converters will not be affected even after they have become worn out. If the catalytic converters do not perform satisfactorily or if it has totally failed, the harmful emissions produced by petrol vehicles will be more lethal than the emissions produced by diesel vehicles as the former can kill without any trace.

Mr President, the Government has proposed fuel duty concessions, reduction of the annual licence fees for vehicles and the first registration tax in order to lower the operating costs of the taxis, public light buses and small school buses. Yet these concessions are provided only during the first 10 years.

Under the veil of concessions in order to attract the taxis and public light buses to switch to petrol, these are in fact mandatory measures which induce the drivers into a snare who will then find themselves reap the benefits first and then bear the hardships later. Like it or not, the diesel vehicle owners have to switch to petrol as soon as possible, otherwise, they have to bear a substantial increase in licence fees. Operators of light vans will suffer most because they will not enjoy any concession as the Government is of the opinion that these operators can absorb the extra cost with their clients and fuel constitutes a small proportion of transport costs. I really cannot understand the logic behind the Government's argument. Taxis and public light buses can enjoy concessions so that their customers, that is the passengers, can benefit, but the clients of the light vans cannot. In fact, not all light vans are owned by large companies, most of the light van owners are self-employed. The current proposal of the Government will directly affect their livelihood.

On the other hand, the Government does not agree that increase in the annual licence fee for vehicles which continue to stay on diesel is a punitive measure. It said that it was necessary to raise the operating costs of the diesel vehicles in order to be fair to other vehicles which have switched to petrol. The Government's argument is just like saying that if A is robbed of $10, then B must be robbed of $10 in order to be fair to A. This is a novel sort of "fairness" put forth by the Government.

Obviously what the Government is going to provide is not real concessions. The diesel vehicle owners now pay less fuel duty, which will be increased by the Government in the future. The Government will not incur any fiscal loss but the public will suffer when the concession period is over in 10 years' time, operating costs of petrol vehicles will increase as fuel duty also increases. Eventually the extra cost will be shifted onto the commuters who have to pay a fare higher than that of other public transport running on diesel.

The public do not mind paying higher fare in order to enjoy fresher air. But if the fare increase is not as moderate as the Government has estimated and the fuel is not as environmental friendly as the Government has expected, will the public be willing to support an expensive but not effective scheme?

In regard to the operating costs, which include both the costs of maintenance and fuel, of taxis and public light buses running on petrol, there are discrepancies between the estimation by the Government and by the trade. If the trade's estimation is correct, then the current proposal of the Government will indeed deal a heavy blow to the trade and jeopardize the future development of the trade.

The trade is worried that after switching to petrol, the performance of the vehicles will be worse than diesel vehicles and will no longer suitable to the road situation in Hong Kong. Despite that, the Government points out that in many American cities such as New York, petrol taxis run a longer mileage than Hong Kong taxis. It further argues that as taxis in these foreign countries can run on petrol, there is no reason why it is not feasible in Hong Kong.

I would like to ask the Government some questions: Are taxis in Hong Kong operated in the same way as the taxis in New York? Are the road situations in these two cities the same? Do they have the same climate and geographical environment? If the answer is no, how can the Government conclude that the foreign model can apply to Hong Kong? Since there are discrepancies between the estimated operating costs presented by the trade and the Government's estimate, and the foreign model may not be applicable to Hong Kong, why not the Government conduct an experiment to compare the performance of a diesel taxi and a petrol taxi. Only in so doing will the data obtained can truly reflect the discrepancies in operating costs by running on diesel and petrol and prove that the fare increase will be as moderate as the Government has expected. Most importantly, we have to obtain data which are acceptable and trusted by the public and the trade.

Mr President, as I have raised so many questions on the effectiveness of the Government's proposal, this may lead some to query whether I am urging the Government to stop doing anything and allow the worsening of our air quality. Certainly not. I must reiterate that I share the objective of the Government and the environmentalists: to show our determination to improve the air quality by our acts.

The current proposal put forth by the Government is exactly what Dr BARRON of the Hong Kong University has suggested. He recommends that all light vehicles should run on petrol and tighter emission controls and testing should be imposed on heavy vehicles. However, Dr BARRON also agrees that there is another alternative as suggested by Dr RUSCO and Dr WALLS of the Hong Kong University: to use high quality diesel and upgrade the emission standard of new vehicles. In addition, maintenance should be upgraded in order to reduce the amount of pollutants, including suspended particulates, emitted by all diesel vehicles. Dr RUSCO and Dr WALLS are of the opinion that their suggestion is more effective but less expensive than Dr BARRON's.

Thus we are facing many alternatives rather than either "death" or the Government's proposal as it warns. In fact, we do not come to the end of a blind alley, for there are many viable routes to take.

According to a research conducted by the Hong Kong Polytechnic University, if all taxis and public light buses have switched to petrol, the total amount of suspended particulates and RSP will be reduced by 12% and 18%. However, if low pollution diesel is used, the respective figures will be 8% to 10% and 12% to 15%.

The report by Dr RUSCO and Dr WALLS also points out that by switching to quality diesel of low sulphur content, emissions will be reduced by 25%, and the particulates and nitrogen oxides emitted will be reduced by 22.5% and 21.7% respectively. A report by the Hong Kong University of Science and Technology has quoted an overseas experiment result that a 0.25% to 0.05% reduction in sulphur content will lead to 70% reduction in suspended particulates emitted.

It is clear that the use of low sulphur content diesel will reduce the emissions of diesel vehicles, including suspended particulates. Moreover, we will get an instantaneous and overall improvement in air quality. In fact, the Government has planned to introduce 0.05% sulphur content diesel in April 1997 and the effect is yet to be seen. But now the Government is trying to implement a costly but ineffective policy. It is hardly convincing. In fact, what the Government should do now is to introduce low sulphur content diesel at an earlier date and further lower the sulphur content of diesel.

The use of low sulphur content diesel should be accompanied by a proper testing and maintenance scheme in order to ensure that emissions by diesel vehicles do not exceed the standard required. As early as 1991, Dr BARRON pointed out that the root of air pollution in Hong Kong is that no one can guarantee that the engine of diesel vehicles are correctly tuned. Although the problem has been highlighted, what has the Government done in this aspect? Has it provided any maintenance guideline or standard to the trade? Has it adopted any measure to prevent the mechanical parts responsible for the emission from being tuned arbitrarily? The Government emphasizes time and again that no regulatory authorities in the world can develop an effective maintenance programme for the light diesel vehicles and that as there is no effective maintenance programme, the ban on diesel will be the only prudential policy.

The Government's policy is somewhat like trimming the toes to fit the shoes. It shows that the Government is both incompetent and ignorant. I want to point out that in many states of the United States, various kinds of testing or maintenance schemes are in place. A research on light diesel vehicles has been carried out in Colorado which shows that effective testing and repairs will reduce the amount of particulates by 31%. Although these schemes may not be totally applicable to Hong Kong, they are at least important consideration before we can come up with any testing and repairs scheme applicable to Hong Kong. Unfortunately, we do not see any effort exerted by the Government in this aspect.

Mr President, I think the Government is aware that only diesel vehicles in bad repairs will lead to serious pollution problem. Why not examine the problem and formulate some stringent measures to compel proper testing and repairs rather than turning a blind eye to the installation of sub-standard spare parts in the diesel vehicles and the arbitrary tuning of oil pump of the diesel vehicles? Now the trade has proposed a repairs and maintenance scheme for the emission system in order to upgrade and tighten the repairs standard, which will also completely eradicate arbitrary tuning. Unfortunately, the Government thinks that it is not worth considering and insists its "clean-cut" approach, that is to eliminate all diesel vehicles of four tonnes and below. Other than that, no suggestion is accepted. Is this fair to the trade which is sincerely offering help to improve the air quality?

Finally, I would like to point out that the Government should review the proposed concessions and put forth real concessions rather than disguised ones. If the concessions are genuine, does it have to worry that the car owners are reluctant to switch to petrol? If some car owners voluntarily switch to petrol, the amount of suspended particulates emitted will be reduced to a certain extent. However, as not all fleets for business operation are forced to switch to petrol, our worry about emissions by petrol vehicles will be alleviated.

The suspended particulates emitted by diesel vehicles will be greatly reduced if multi-measures are adopted at the same time. These include the use of low sulphur content diesel, the implementation of stringent testing and repairs scheme, a voluntary diesel-to petrol concession scheme, as well as the tightening of the emission standard proposed by the Government. Furthermore, it will effectively reduce the amount of the other pollutants emitted by diesel vehicles. In the long term, the Government should proactively consider the use of other fuels, such as natural gas or LPG, which have been proved to be more environmental friendly.

Mr President, the Honourable IP Kwok-him, at the joint meeting of the Panel on Environmental Affairs and the Panel on Transport, described the diesel-to-petrol scheme as somewhat like "resisting a tiger at the front door but letting a wolf creep in from the rear door". However, the Government thinks that they are not only resisting a tiger and a wolf but also bringing in a tame cat. I hope the Government will not be over-excited and open the door too early before it has confirmed that it is really a cat and not in fact a leopard.

Mr President, with these remarks, I beg to move. Question on the motion proposed.

PRESIDENT: Miss Christine LOH has given notice to move an amendment to the motion. Miss LOH's amendment has been printed on the Order Paper and circularized to Members. I propose to call on her to speak and to move her amendment now so that Members may debate the motion and the amendment together.

SECRETARY FOR TRADE AND INDUSTRY: Mr President,

  1. We do not have statistics on the number of accidents involving industrial and household glassware products and installations. Industrial accident statistics are analyzed by cause and by industry. There is no breakdown by either the material or the equipment involved in industrial accidents. The Hospital Authority compiles patient statistics according to international classification of diseases. It does not have separate figures on the number of accidents involving use or installation of glassware products.
  2. The safety of glassware products for private use or consumption is already covered by the Consumer Goods Safety Ordinance, which came into force in October this year. This Ordinance imposes a statutory duty on manufacturers, importers and suppliers of consumer goods (including glassware products) to ensure that the goods they supply in Hong Kong are safe. Section 4 of the Ordinance further requires that consumer goods (including glassware products) supplied in Hong Kong must comply with a general safety requirement which includes, inter alia, the adoption of reasonable safety standards published by a standards institute. Any supplier who fails to comply with the requirement under the Ordinance commits an offence. The Commissioner of Customs and Excise will monitor the situation and take enforcement action as appropriate.
    Accordingly, we do not see the need to introduce specific regulations to stipulate the safety standards for household glassware products and to require manufacturers to specify on their products the types of glass used and the level of durability measured in an impact test.

Relocation of Methadone Clinic to Tsui Ping Estate

13. MR FRED LI asked (in Chinese): The 10-year redevelopment programme for Kwun Tong Town Centre proposed by the Land Development Corporation includes the relocation of the methadone clinic at the Town Centre to Tsui Ping Estate nearby. As methadone clinics often bring nuisance to the community in which they are located, will the Government inform this Council:

  1. whether it will consult local community groups and residents in this regard; if so, what are the details; if not, why not;
  2. whether the Government will make alternative arrangements to set up the methadone clinic further away from Tsui Ping Estate in view of the worsening drug abuse problem in that Estate; and
  3. what long-term and interim measures the Government has adopted to tackle the drug abuse problem in the neighbourhood of Tsui Ping Estate?

SECRETARY FOR SECURITY: Mr President,

  1. The Kwun Tong Town Centre Redevelopment Scheme proposed by the Land Development Corporation (LDC) is still being considered by the Corporation and the Administration. If the Scheme is to be implemented, the Kwun Tong District Board, and other relevant local bodies, where appropriate, will be consulted in advance on any proposal to relocate the methadone clinic.
  2. No decision has been made on whether and where the methadone clinic in Kwun Tong should be relocated. The Government is open-minded about the location of methadone clinics. An important consideration is the accessibility of the clinic, as the objective of the methadone programme is to offer a readily accessible out-patient service for those drug abusers who seek treatment but, for various reasons, would not be able to take part in residential treatment programmes.
  3. The drug abuse problem in the neighbourhood of Tsui Ping Estate is being tackled at source by stepped-up law enforcement action, and preventive education and publicity.
    Police enforcement action against drug activities in Tsui Ping Estate has been stepped up. This can be seen from the number of arrests for serious narcotics offences in Tsui Ping Estate, which has increased from 46 in 1994 to 80 in the first nine months of 1995. At the street level, enhanced enforcement actions are taken on a daily basis against drug sellers and users. Information and intelligence on drug activities, with particular emphasis against drug sellers, are collected, collated and acted upon by the Kwun Tong District Special Duties Squad to target known drug sellers.
    The police also contributes to anti-drug education by organizing school visits and seminars with school headmasters and discipline masters, focussing on the prevention of drug abuse by students.
    Extra efforts have been put in preventive educational and publicity measures to arouse awareness among Kwun Tong residents on the drug problem. Emphasis has been laid on enhancing parents' understanding on the prevention and early detection of their children's involvement in drugs. In 1995-96, a total of seven programmes involving 10 000 participants have been/will be implemented by the social welfare service units in the district. Existing counselling services of family service centres and probation offices in the district have also been strengthened to help young people with drug problems and their families.
    The District Social Welfare Office (DSWO) in Kwun Tong has formed a Working Group on "District-wide publicity campaign in combating illicit use of drugs among young people in Kwun Tong District" in April*1995, to promote co-ordination and co-operation among government departments and local organizations to tackle the drug problem. A "Drug Ambassador Scheme" is now being launched by the Working Group, with the aim of publicizing widely anti-drug messages among young people through a signature campaign. So far over 7 000 participants from more than 30 local organizations have been enrolled. The Working Group also compiles leaflets on district beat-drug activities on a regular basis to encourage participation of local residents.
    In the longer term, the DSWO in Kwun Tong will continue to take active part in the Kwun Tong District Fight Crime Committee to plan and co-ordinate anti-drug strategies at the district level. Group work units in the district, particularly the Group Work Unit of the Kwun Tong Community Centre (which is located in Tsui Ping Estate) will organize regular activities to educate young people to stay away from drugs. Services from the "Against Substance Abuse Scheme" provided by the team of specially trained social workers newly set up by the Social Welfare Department would also be tapped whenever necessary.
    A paper on "Illicit use of drugs in Kwun Tong District" was discussed at the Kwun Tong District Fight Crime Committee meeting in May*1995 to co-ordinate district efforts in tackling the problem. Local non-government organizations will be encouraged to organize anti-drug activities through various channels such as the Kwun Tong District Committee on Family Life Education, the Kwun Tong District Group and Community Work Service Co-ordinating Committee. Social workers of the Society for the Aid and Rehabilitation of Drug Abusers working in the methadone clinic in the district will continue to provide casework services to drug abusers to facilitate their social rehabilitation.

Air Services to Taiwan

14. MR LAW CHEUNG-KWOK asked (in Chinese): Will the Government inform this Council:

  1. whether, in order to be eligible to apply for a licence to operate air services between Hong Kong and Taiwan, the China National Aviation Corporation (CNAC) has made a formal application to become an airline whose principal operation is based in the territory; if so, what factors the Government will take into consideration in determining whether a licence will be granted to CNAC to operate the route; if not, whether it will consider inviting CNAC to make such an application; and
  2. what share of the market does the Cathay Pacific Airways (CPA) have in providing air services between Hong Kong and Taiwan, and whether CPA has adopted any policy which is not in the interest of the consumers?

SECRETARY FOR ECONOMIC SERVICES: Mr President,

  1. The China National Aviation Corporation (Hong Kong) Limited (CNAC(HK)) submitted an application for an Air Operator's Certificate (AOC) to the Civil Aviation Department (CAD) on 29 March 1995. Securing an AOC is a necessary prerequisite to operate Hong Kong registered aircraft for the purpose of public transport. An AOC may be granted if the Governor is satisfied that the applicant is competent, having regard in particular to his previous conduct and experience, his equipment, organization, staffing, maintenance and other arrangements to secure the safe operation of aircraft of the types specified in the certificate. CNAC(HK) has not yet submitted any documents in support of its application. CAD will give due consideration to the application when such documents are received.
    An application for an AOC is the first of several steps which a company has to go through before it will be able to mount scheduled air services with Hong Kong registered aircraft. In addition, the company will also have to apply for registration of its aircraft, obtain a licence for a specific route from the Air Transport Licensing Authority and seek designation by the Government for the route concerned. It is not government policy to invite any particular airline to make an application for any route; the airline concerned would have to apply and fulfill all the necessary requirements before it will be permitted to operate.
  2. At present, scheduled air services between Hong Kong and Taiwan are operated between Hong Kong and two cities in Taiwan, namely, Taipei and Kaohsiung. On the Hong Kong - Taipei route, the Cathay Pacific Airway's (CPA's) market share was 51.1% in the 12 months up to August 1995. On the Hong Kong - Kaohsiung route, CPA's market share was 53.8% in the same period.
    On both of the routes between Hong Kong and Taiwan, there is a choice for consumers. On the Hong Kong * Taipei route (which constitutes 82% of the total traffic between Hong Kong and Taiwan), six other airlines, apart from CPA, operate on the route. They are British Asia Airways, China Airlines, Japan Asia Airways, Singapore Airlines, Garuda Indonesia Airways, and Thai Airways International. On the Hong Kong * Kaohsiung route where traffic is only about 18% of the total traffic between Hong Kong and Taiwan, China Airlines operate on the route in addition to CPA.

Application and Approval of Search Warrants

15. MR CHIM PUI-CHUNG asked (in Chinese): In regard to applications for search warrants by government departments, will the Government inform this Council:

  1. of the criteria on which the court's approval of an application for search warrant file by a government department is based and whether there is any system to keep this power in check;
  2. whether the court or the department which files the application will be held responsible in the event that the application is subsequently proved to be at fault or ultra vires;
  3. of the time normally taken for obtaining a search warrant; and
  4. if members of the public have objections to be contents of an application for search warrant, to which department should they go to in order to raise their objection prior to the grant of the search warrant?

CHIEF SECRETARY: Mr President,

  1. In granting applications for search warrants, the court acts in accordance with the provisions in the relevant legislation under which the applications are made. The magistrate responsible will make sufficient enquiry to satisfy himself that there is reasonable cause to suspect that the items in respect of which the warrant is sought are on the premises to be searched. Such enquiry could include questioning the police officer requesting the search warrant under oath or affirmation or requiring the information in support of the warrant to be more precise.
    The power to grant warrants is discretionary. Therefore, a magistrate is not required to accede to an application for a search warrant even where the statutory requirements have been met. This together with the fact that a magistrate must refuse to grant a warrant if he is not satisfied that there is reasonable cause to suspect that the items in respect of which the warrant is sought are on the premises to be searched, serves to keep searches by government departments in check.
  2. Whether the court or the department which filed the application would be held responsible in the event that the application is subsequently proved to be at fault or ultra vires depends upon the circumstances in which the search warrant was issued. In general terms, a court could only be held responsible where it was established that it was acting maliciously and without reasonable and probable cause; and a government department could only be held responsible where it was established that it was acting maliciously.
  3. A department can normally obtain a search warrant from the court on the same day it files an application.
  4. An application for a search warrant is made ex parte, that is, only the party making the application is present. To inform the owner of the premises to be searched of the application would defeat the purpose of the search.

Air-tickets for Civil Servants on Duty Visits

16. MR CHEUNG MAN-KWONG asked (in Chinese): With regard to the purchase of air-tickets by the Government for civil servants on overseas duty visits and training, will the Government inform this Council:

  1. of its policy on purchasing such air-tickets;
  2. whether agreements have been made with any airlines for the purchase of air-tickets; if so, what are the details and why such agreements have been made;
  3. of the expenditure involved in purchasing such air-tickets during the past two years, together with a breakdown of the number of civil servants involved and their destinations;
  4. whether the Government has information to show that the adoption of its present policy on the purchase of such air-tickets, as compared with purchases made through travel agents or by other means, will result in a higher expenditure of public funds; if so, what are the reasons for continuing with the present policy; and
  5. whether consideration has been given to reviewing the present policy on the purchase of such air-tickets; if so, what are the details; if not, whether the Government will consider adopting other arrangements to purchase such air-tickets, such as placing orders with the airline purchase such air-tickets, such as placing orders with the airline charging the lowest fares or introducing other forms of competition?

SECRETARY FOR THE CIVIL SERVICE: Mr President, the answers to the questions raised are:

  1. The Government has an agreement with the British Airways (BA) and Cathay Pacific Airways (CPA) under which air-tickets (from any airlines) for civil servants on overseas duty visits have to be purchased through Jardine Airways (BA's general agent) or CPA. Air-tickets for civil servants on overseas training are not covered by the agreement, and can be purchased through any travel agent which accepts direct payment by the Treasury.
  2. The passage agreement with BA and CPA basically covers the Government's duty and school passages, but the Government may also make use of the contract fares for other passages to and from the United Kingdom. The main features of the agreement are:

    1. BA and CPA provide air-tickets at reduced fares on the Hong Kong - United Kingdom direct route (the United Kingdom route); and
    2. air-tickets on non-United Kingdom routes (from any airlines) have to be purchased through Jardine Airways or CAP.
      The Government entered into an agreement with the two airlines because the service required by the Government was and remains mainly passages on the Hong Kong - United Kingdom direct route ─ the bulk of which relate to school passages. Until 1994 only BA and CPA provided direct-route service to the United Kingdom. With the exception of Virgin Atlantic Airways (VAA) which started operating on the Hong Kong - United Kingdom direct route in 1994, the other airlines do not provide direct-flight service on the this route and therefore are unable to participate. We are discussing with BA and CPA the possibility of including the service of VAA in the current agreement.
    3. The expenditure involved in purchasing air-tickets for civil servants' overseas duty visits and training in 1993-94 and 1994-95 is $85.4 million, involving a total of 5 956 return passages. We have not kept specific records on the destinations of these passages.
    4. On the whole, we are getting a reasonable deal out of the agreement with BA and CPA as the Government is able to benefit from the reduced fares on the Hong Kong - United Kingdom direct flights with guaranteed bookings in both peak and off-peak seasons. The current arrangement for the purchase of air-tickets for civil servants' overseas duty visits and training, even if considered on its own, does not incur a much higher public expenditure, since the costs of published-fare air-tickets are roughly the same irrespective of from which agent they are bought. We are using published fares because the lower-fare air-tickets available in the market are very often special or promotional-fare tickets with usage restrictions attached, which would frequently not meet the operational requirements of these duty visits.
    5. With a view to achieving further savings, we are discussing with BA and CPA the possibility of including the service of VAA in the current agreement. We are also reviewing the scope of our being able to make use of the cheaper air fares available in the market for civil servants' overseas duty visits and training.

Green Island Public Dump Scheme

17. MR AMBROSE LAU asked (in Chinese): Now that the Government is consulting the public on the feasibility of the Green Island Public Dump Scheme and that the removal of Hong Kong International Airport has been scheduled for 1998, will the Government inform this Council whether consideration will be given to transporting construction waste on Hong Kong Island by land or by sea to the waters off the Airport and Kowloon Bay for dumping as an interim measure, as such a move will prepare that area for the future reclamation work on the one hand and allow more time for the public to study the policies relating to the Green Island reclamation on the other?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, the Territory Development Department has commissioned a feasibility study on the proposed future development of Kowloon Bay and the current Hong Kong International Airport. The study will examine, among other things, the possible sources of fill material, including construction waste, suitable for the proposed reclamation at Kowloon Bay. Findings of the study will help the Government in considering the viability of public dumping at Kowloon Bay and/ or the Airport. The study is scheduled to be completed in mid-1997. No decision will be made before the Government has examined the findings thoroughly.

Oxygen Content in Air

18. DR SAMUEL WONG asked: The proportion of oxygen in the air in some urban districts is sometimes found to be as low as 10%, although the normal oxygen content in the air is about 20%. In such circumstances, people will have to inhale more air, and hence more pollutants, than normal in order to get the oxygen required. In this connection, will the Government inform this Council whether:

  1. the Government will consider releasing the multiplication factor of pollution intake in each district due to lower oxygen content along with the pollution indices now published daily by the Environmental Protection Department; and
  2. if the answer to (a) above is in the negative, whether the Government will consider taking such factor into account in determining the pollution indices?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, the Air Pollution Index is designed to reflect the quality of outdoor air, of which the oxygen content is constantly at the normal level of 20%. In the outdoor environment, the carbon dioxide level in Hong Kong is well below 0.5% and variations around this level of concentration will not affect the oxygen content of the air. The issue of low oxygen in outdoor air is only relevant to locations at altitudes above 10 000 feet; but this is not relevant to Hong Kong. It is therefore not necessary for the Air Pollution Index to take into account the oxygen content. Hence, the answers to both (a) and (b) are in the negative.

Monitoring of H Share Companies

19. DR HUANG CHEN-YA asked (in Chinese): Will the Government inform this Council whether:

  1. the Securities and Futures Commission (SFC) will make a comparison between the profits predicted in the prospectuses of H share companies and the performance of these companies as published after the first year;
  2. the SFC has carried out investigations into companies which have recorded marked discrepancies between the predicted and actual profits; if so, what are the findings; and
  3. there are statutory provisions requiring merchant banks to be responsible for the accuracy of the information contained in prospectuses; if so, what are the liabilities of the merchant banks in the event that the particulars in the prospectuses are found to be incorrect, and what penalties will be imposed on them; if not, whether the Government will require merchant banks to assume responsibility, so as to reduce the chance of investors being misled?

SECRETARY FOR FINANCIAL SERVICES: Mr President,

(a) and (b)

    The Stock Exchange of Hong Kong (SEHK) is the frontline regulator responsible for the supervision of listed companies and the administration of all related matters. The SFC oversees the SEHK but is not directly involved in such matters.

    The SEHK reviews the performance of all newly listed companies, including H share companies, for the first accounting year after their listings, and compares that with the projected profits stated in the respective prospectus of the companies.

    All listed companies are required to sign a Listing Agreement and to abide by the SEHK Listing Rules. Under the Listing Agreement, a listed company is obliged to notify shareholders promptly of the occurrence of any event which could cause the forecast assumptions to be materially different from those stated in the prospectus and to indicate the likely impact of such event on the projected profits. The Listing Agreement also requires a company in such circumstances to include an explanation for such material difference in its directors' report and accounts.

    The SEHK monitors compliance with the Listing Rules and carries out inquiries where necessary. During the past three years, the SEHK has found two cases (one of which involves an H share company) where the actual results published in the directors* report and accounts differed materially from the projected profits stated in the relevant prospectus. In both cases, the company involved has issued a clarification statement to the public in accordance with the relevant Listing Rules.

  1. There are no statutory provisions which expressly impose special responsibilities on merchant banks for the accuracy of prospectuses. However, there are statutory provisions under which merchant banks could be exposed to criminal and civil liabilities in respect of untrue statements in prospectuses. Such liability is imposed on every person who has authorized the issue of the prospectus containing untrue statements. Coming within the wide class of persons who authorize the issue of the prospectus can be brokers, merchant banks, solicitors and others associated with the prospectus.
    Civil liability is created by section 40 of the Companies Ordinance (the Ordinance) in respect of Hong Kong companies, and section 342E of the Ordinance in respect of companies incorporated outside Hong Kong. The liability is to persons who subscribe for securities on the faith of a prospectus and sustain loss or damage by reason of any untrue statement contained therein.

    Criminal liability is created by section 40A of the Ordinance in respect of Hong Kong companies and section 342F of the Ordinance in respect of companies incorporated outside Hong Kong. If a prospectus contains a false statement, any person who authorized its issue will be guilty of an offence unless he can establish certain specific defences.

    The penalty for breaching section 40A or section 342F of the Ordinance is a fine of $500,000 or imprisonment for three years on indictment, and a fine of $100,000 and imprisonment of 12 months on summary charge.

    If a merchant bank acts as a sponsor in relation to a listing, it also has to comply with the Model Code for Sponsors of the Listing Rules. The Code requires that the sponsor should be closely involved in the preparation of the listing document and in ensuring that all material statements therein have been verified and that it complies with the Listing Rules and all relevant legislation. Failure by a sponsor to meet its obligations under the Listing Rules without reasonable excuse may render that person unacceptable to the SEHK for performing the role of a sponsor in the future.

ADDRESS

Ocean Park Corporation Annual Report 1994-95

MR RONALD ARCULLI

: Mr President, tabled before the Council today is the 1994-95 annual report of the Ocean Park Corporation.

In the financial year that ended on 30 June 1995, the Ocean Park enjoyed another year of record attendance with 3.3 million visitors to the Park, an increase of 5% on last year's record of 3.2 million.

The Ocean Park's revenue grew by 6% to HK$324 million. Operating income was HK$319 million. The net operating surplus for the financial year was HK$23 million, which compared with a net operating surplus of HK$53 million in the 1993-1994 financial year.

These results are most satisfactory given the difficulties encountered during the year. The higher attendance figure was pleasing given that Hong Kong experienced a series of severe tropical storms during the year which necessitated partial closure of the Park.

The number of overseas visitors to the Park fell by 9% mainly due to the drop in the number of tourists from China and Taiwan. Fortunately, more local residents visited the Park. The record number of visitors was largely due to improvements in the Ocean Park and new attractions which opened during the year.

Three new attractions costing a total of HK$58 million were opened in time for the Christmas-New Year holidays. On the Headland, we opened the 100-foot tall Ferris Wheel which provides spectacular views 400 feet above the South China Sea. We also opened the Eagle Ride which proved extremely popular. However, it is currently closed while modifications are made and tested. We plan to have the ride fully operational early next year. On the Lowland, we opened the Dinosaur Discovery Trail which, with its lifelike models and animatronic robots, proved an instant success with the public.

The largest influx of visitors came during the spring in response to the re-opening of the Atoll Reef. The Atoll Reef has traditionally been the Park's most popular attraction. The Reef has undergone a HK$65 million refurbishment and is now the largest reef aquarium in the world.

During its first full year of operation, the Ocean Park Conservation Foundation announced a five-year plan involving 16 whale and dolphin projects which include identification of conservation problems, development and executive of action plans, and long-term research to direct and support future marine mammal conservation efforts in the region.

The Foundation also convened the first meeting of the Asian River Dolphin Committee. Scientists from nine countries, including China, and representatives of the IUCN Cetaccan Specialist Group and The Whale and Dolphin Conservation Society met to discuss strategies for protecting threatened marine mammals.

The Ocean Park has an on-going commitment to improve access to the Park's facilities for Hong Kong's disabled residents. This year, new facilities for the disabled included contour models for mechanical rides, tactile maps and guide books for the visually impaired, improved access for wheelchair-bound visitors and the installation of a special gondola for disabled visitors on the new Ferris Wheel.

While the recent difficulties experienced at the Park fall outside this financial year, it would be remiss of me not to congratulate the management and staff on the way they handled the consequences of the tragic Aberdeen landslide.

Through their work, the comfort and safety of both visitors and of the Park's marine mammals, fish and animals were assured, and the Park was able to return to normal operations in a speedy manner. Above all, we owe special thanks also to the Government Flying Service, the Fire Services Department and the Electrical and Mechanical Services Department.

Looking to the future, our long-term development plan is to continue to expand and to better serve the needs of all age groups and interests within the community. In the next year, we expect to have further improvements and add new attractions including the opening of a Mine Train roller coaster and a high-tech simulator ride.

After a year that was both rewarding and eventful, the Ocean Park will continue to work to fulfill its mission to provide a balanced mix of recreation, education and conservation. I believe the Ocean Park is well set to achieve even higher levels of popularity and success.

Thank you, Mr President.

MOTIONS

EMPLOYEES' COMPENSATION ORDINANCE

THE SECRETARY FOR EDUCATION AND MANPOWER to move the following motion:

    "That, with effect from 1 January 1996, the Employees' Compensation Ordinance be amended as follows -
  1. in section 6 -
    1. in subsection (1)(a), (b) and (c), by repealing "$15,000" and substituting "$18,000";
    2. in subsection (2), by repealing "$219,000" and substituting "$262,000";
    3. in subsection (5), by repealing "$12,000" and substituting "$14,000";
  2. in section 7 -
    1. in subsection (1)(a), (b) and (c), by repealing "$15,000" and substituting "$18,000";
    2. in subsection (2), by repealing "$248,000" and substituting "$297,000";
  3. in section 8(1)(a) and (b), by repealing "$297,000" and substituting "$356,000";
  4. in section 11(5), by repealing "2,250" where it twice appears and substituting "2,450";
  5. in section 16A(10) -
    1. in paragraph (a), by repealing "$350" and substituting "$420";
    2. in paragraph (b), by repealing "$700" and substituting "$840";
  6. in section 17A(1) -
    1. in paragraph (a), by repealing "$350" and substituting "$420";
    2. in paragraph (b), by repealing "$700" and substituting "$840";
  7. in section 36C, by repealing "$24,000" and substituting "$28,000";
  8. in section 36J, by repealing "$74,000" and substituting "$86,000";
    1. in paragraphs 1(b), 2(b) and 3 of the Third Schedule, by repealing "$120" and substituting "$160"."

He said (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

The purpose of this resolution is to revise the levels of compensation and certain compensation-related items under the Employees' Compensation Ordinance. The Ordinance provides for payment of compensation by employers to employees who are injured or killed as a result of employment-related accidents. Our policy since 1978 has been to review the levels of compensation every two years to take account of wage movements, inflation and other changes. The existing levels of compensation have been in force since 1 January 1994 and are now due for revision. We propose that the revised rates should take effect as from 1 January 1996.

We propose to increase the ceiling for monthly earnings from $15,000 to $18,000. This figure is the basis on which the maximum amounts of compensation for permanent total incapacity and for death are calculated under the Ordinance. We also propose to increase the minimum levels of compensation for death from $219,000 to $262,000, and for permanent total incapacity from $248,000 to $297,000. In addition, we propose that the maximum amount of compensation for the costs of care required by another person be revised from $297,000 to $356,000. For late payment of compensation, we propose to increase the minimum amount of surcharge imposed upon expiry of the payment period from $350 to $420 and the minimum additional surcharge imposed three months after expiry of payment period from $700 to $840. Each of these six proposed revisions represents an increase of about 19.7% over the existing levels, which is in line with the increase in nominal wages during the past two years.

The ceilings on three other forms of compensation are to be adjusted to take account of inflation since their last revision in 1994. The proposed changes include increasing the maximum amount for burial expenses from $12,000 to $14,000, and increasing the maximum payments to be made by an employer towards the costs of supplying and fitting a prosthesis or a surgical appliance from $24,000 and $74,000 respectively to $28,000 and $86,000 respectively.

We also propose to raise the maximum daily rate of reimbursement of medical expenses from $120 to $160 to take account of the increase in fees charges by public hospitals and clinics since 1994.

Finally, we propose to revise the amount that is deemed to be the minimum earnings per month for the purpose of calculating compensation from $2,250 to $2,450. This proposed increase serves to keep the deemed minimum earnings of an injured employee broadly in line with the existing rate of payment to a singleton under the Comprehensive Social Security Assistance Scheme.

These proposals have been endorsed by the Labour Advisory Board and I recommend them to this Council for approval.

Mr President, I beg to move.

Question on the motion proposed.

MR LAU CHIN-SHEK (in Cantonese): Mr President, I certainly support today's motion which seeks to increase the rate of compensation for workers who were injured or even killed in the course of their work. However, I would also like to take this opportunity to state again what I think are the shortcomings of the present Employees' Compensation Ordinance, hoping that the Government will review the whole system of workers' compensation as soon as possible.

The legislation currently in force has stipulated various ceilings for calculating the rate of compensation for workers who have permanently lost the ability to work in the course of their work and has made it impossible for workers to obtain the compensation that they deserve. First, concerning the calculation of the monthly wage ceiling. Although today's motion seeks to increase the monthly wage ceiling from $15,000 to $18,000, that is still an unreasonable restriction, especially in the construction sector in which workers suffer serious injuries. For the many steel fixers, scaffold erectors and the majority of other professionals who may be earning a monthly wage exceeding $18,000, the present legislation has undoubtedly deprived them of the compensation that they deserve. Therefore the Government should consider abolishing the monthly wage ceiling. In fact, the present monthly wage ceiling for the calculation of severance pay and long service payment has already been increased to $22,500, but that for the calculation of workers' compensation is only to be increased to $18,000. This is obviously an unfair treatment to workers claiming workers' compensation.

Second, concerning the upper limit of the amount of compensation. According to the Employees' Compensation Ordinance, the maximum amount of compensation which workers can claim of the basis of injury or death sustained in the course of work is equivalent to seven years or eight years of their total income respectively. These ceilings, which have been set without and objective criteria, are particularly unfair to young workers seeking workers' compensation. For instance, a 17-year-old summer job worker was killed in an accident involving a hoist in North Point in June 1993. According to the law, he could only obtain compensation equivalent to eight years of his total wage and deductions had to be made according to the family's reliance on him. As a result, this worker's family could only obtain compensation amounting to $100,000 plus. Do you think that is fair? Human life is invaluable and the law which has imposed various restrictions on workers' compensation should absolutely be reviewed and improved. The Government may think that workers claiming workers' compensation can try to obtain more by suing their employers for negligence through civil proceedings. However, legal proceedings not only involve many problems of evidence, they are also very time-consuming; and a law suit will normally drag on for three to five years. That is undoubtedly unfair to the injured workers and their families. Therefore, I think a comprehensive review on the Employees' Compensation Ordinance should be conducted without delay so as to strengthen the protection given to workers claiming workers' compensation. Of course, what is more important is to improve industrial safety in Hong Kong so as to prevent the occurrence of accidents.

Mr President, with these remarks, I hope the Secretary for Education and Manpower can clearly respond to my demands in his concluding speech later on. Thank you.

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, I would like to thank the Honourable LAU Chin-shek for his speech as well as his support for this motion. I have listened very carefully to the views expressed by Mr LAU on some items. The Government will consider these views in detail in the next review. There is no doubt that we will fully consider the views of both the employers and employees with regard to this Ordinance in every review.

Thank you, Mr President.

Question on the motion put and agreed to.

PNEUMOCONIOSIS (COMPENSATION) ORDINANCE

THE SECRETARY FOR EDUCATION AND MANPOWER to move the following motion:

    "That, with effect from 1 January 1996, the Pneumoconiosis (Compensation) Ordinance be amended as follows -
  1. in the First Schedule -
    1. in paragraph 1 of Part II, by repealing "$2,100" and substituting "$2,570";
    2. in Part IV, by repealing "$3,500" and substituting "$4,050";
    3. in Part VI, by repealing "$12,000" and substituting "$14,000";
  2. in the Second Schedule, in paragraphs 1(b), 2(b) and 3 of Part I, by repealing "$120" and substituting $160".

He said (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

The purpose of this resolution is to revise the levels of compensation and certain compensation-related items under the Pneumoconiosis (Compensation) Ordinance. The Ordinance provides for payment of compensation for persons who were diagnosed after 1 January 1981 to be suffering from pneumoconiosis. We propose that the revised rates should take effect as from 1 January 1996.

We propose to raise the ceilings in respect of two items of compensation under the Ordinance to take account of inflation and wage movements since July 1993. First, we propose to increase the amount for calculating the monthly compensation for total incapacity, from $2,100 to $2,570. In this respect, it should be noted that under the Pneumoconiosis (Compensation) (Amendment) Bill which was introduced into this Council on 6 December 1995 (that is last Wednesday), the amount of $2,100 was proposed to be made a separate compensation item for pain, suffering and loss of amenities which would be paid to all eligible pneumoconiotics regardless of their degree of incapacity. Therefore, if this proposed revision is approved, we will move a Committee Stage Amendment to the Bill to revise the amount to $2,570. Secondly, we prepare to increase the amount of compensation for care and attention from $3,500 to $4,050.

OFFICIAL RECORD OF PROCEEDINGS
Wednesday, 13 December 1995
The Council met at half-past Two o'clock

MEMBERS PRESENT

THE PRESIDENT
THE HONOURABLE ANDREW WONG WANG-FAT, O.B.E., 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 MARTIN LEE CHU-MING, Q.C., J.P.

DR THE HONOURABLE DAVID LI KWOK-PO, O.B.E., LL.D. (CANTAB), J.P.

THE HONOURABLE NGAI SHIU-KIT, O.B.E., J.P.

THE HONOURABLE SZETO WAH

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

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

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

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

DR THE HONOURABLE EDWARD LEONG CHE-HUNG, O.B.E., J.P.

THE HONOURABLE ALBERT CHAN WAI-YIP

THE HONOURABLE CHEUNG MAN-KWONG

THE HONOURABLE CHIM PUI-CHUNG

THE HONOURABLE FREDERICK FUNG KIN-KEE

THE HONOURABLE MICHAEL HO MUN-KA

DR THE HONOURABLE HUANG CHEN-YA, M.B.E.

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 HENRY TANG YING-YEN, J.P.

THE HONOURABLE JAMES TO KUN-SUN

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

DR THE HONOURABLE PHILIP WONG YU-HONG

DR THE HONOURABLE YEUNG SUM

THE HONOURABLE HOWARD YOUNG, J.P.

THE HONOURABLE ZACHARY WONG WAI-YIN

THE HONOURABLE CHRISTINE LOH KUNG-WAI

THE HONOURABLE JAMES TIEN PEI-CHUN, O.B.E., J.P.

THE HONOURABLE LEE CHEUK-YAN

THE HONOURABLE CHAN KAM-LAM

THE HONOURABLE CHAN WING-CHAN

THE HONOURABLE CHAN YUEN-HAN

THE HONOURABLE ANDREW CHENG KAR-FOO

THE HONOURABLE PAUL CHENG MING-FUN

THE HONOURABLE CHENG YIU-TONG

THE HONOURABLE ANTHONY CHEUNG BING-LEUNG

THE HONOURABLE CHEUNG HON-CHUNG

THE HONOURABLE CHOY KAN-PUI, J.P.

THE HONOURABLE DAVID CHU YU-LIN

THE HONOURABLE ALBERT HO CHUN-YAN

THE HONOURABLE IP KWOK-HIM

THE HONOURABLE LAU CHIN-SHEK

THE HONOURABLE AMBROSE LAU HON-CHUEN, J.P.

DR THE HONOURABLE LAW CHEUNG-KWOK

THE HONOURABLE LAW CHI-KWONG

THE HONOURABLE LEE KAI-MING

THE HONOURABLE LEUNG YIU-CHUNG

THE HONOURABLE BRUCE LIU SING-LEE

THE HONOURABLE LO SUK-CHING

THE HONOURABLE MOK YING-FAN

THE HONOURABLE MARGARET NG

THE HONOURABLE NGAN KAM-CHUEN

THE HONOURABLE SIN CHUNG-KAI

THE HONOURABLE TSANG KIN-SHING

DR THE HONOURABLE JOHN TSE WING-LING

THE HONOURABLE MRS ELIZABETH WONG CHIEN CHI-LIEN, C.B.E., I.S.O., J.P.

THE HONOURABLE LAWRENCE YUM SIN-LING

PUBLIC OFFICERS ATTENDING

THE HONOURABLE DONALD TSANG YAM-KUEN, O.B.E., J.P. FINANCIAL SECRETARY

THE HONOURABLE JEREMY FELL MATHEWS, C.M.G., J.P. ATTORNEY GENERAL

MR CHAU TAK-HAY, C.B.E., J.P. SECRETARY FOR RECREATION AND CULTURE

MR NICHOLAS NG WING-FUI, J.P. SECRETARY FOR CONSTITUTIONAL AFFAIRS

MRS KATHERINE FOK LO SHIU-CHING, O.B.E., J.P. SECRETARY FOR HEALTH AND WELFARE

MR JOSEPH WONG WING-PING, J.P. SECRETARY FOR EDUCATION AND MANPOWER

MR BOWEN LEUNG PO-WING, J.P. SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS

MR KWONG KI-CHI, J.P. SECRETARY FOR THE TREASURY

MR FUNG TUNG, O.B.E., J.P. SECRETARY FOR HOUSING

CLERKS IN ATTENDANCE

MR RICKY FUNG CHOI-CHEUNG, SECRETARY GENERAL

MR LAW KAM-SANG, DEPUTY SECRETARY GENERAL

MISS PAULINE NG MAN-WAH, ASSISTANT SECRETARY GENERAL

MR RAY CHAN YUM-MOU, ASSISTANT SECRETARY GENERAL

PAPERS

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

Subject

Subsidiary LegislationL.N. No.

Road Traffic (Public Service Vehicles) (Amendment) (No. 5) Regulation 1995 562/95

Hong Kong Airport (Restricted Areas and Tenant Restricted Areas) Order563/95
Road Traffic (Breath Analysing Instruments and Screening Devices) Notice564/95
Toys and Children's Products Safety (Safety Standards) Notice565/95
Official Languages (Authentic Chinese Text) (Road Tunnels (Government) Ordinance) Order(C) 118/95
Official Languages (Authentic Chinese Text) (Tate's Cairn Tunnel Ordinance) Order (C) 119/95

Sessional Papers 1995-96

No. 37─The Prince Philip Dental Hospital Hong Kong Report by the Board of Governors for the period 1 April 1994 - 31 March 1995
No. 38─Ocean Park Corporation Annual Report 1994-95
No. 39─Emergency Relief Fund Annual Report by the Trustee for the year ending on 31 March 1995
No. 40─ Social Work Training Fund Thirty-fourth Annual Report by the Trustee for the year ending on 31 March 1995
No. 41─ Chinese Temples Fund Income and Expenditure Account with Balance Sheet and Certificate of the Director of Audit for the year ended 31 March 1995
No. 42─ General Chinese Charities Fund Income and Expenditure Account with Balance Sheet and Certificate of the Director of Audit for the year ended 31 March 1995
No. 43─ Report of the Brewin Trust Fund Committee on the Administration of the Fund for the year ended 30 June 1995
No. 44─ Grantham Scholarships Fund Income and Expenditure Account with Balance Sheet and Certificate of the Director of Audit for the year ended 31 August 1995
No. 45─ Queen Elizabeth Foundation for the Mentally Handicapped Report and Accounts 1994-95
No. 46─ The Accounts of the Lotteries Fund 1994-95
No. 47─ Hong Kong Housing Authority 1994-95 Annual Report
No. 48─ Hong Kong Housing Authority Annual Accounts for the year ended 31 March 1995 and Balance Sheet as at that date

ORAL ANSWERS TO QUESTIONS

Mother Tongue as Medium of Instruction in Secondary Schools

1.MR IP KWOK-HIMasked (in Cantonese): Mr President, according to the findings of a research conducted by the Education Department, it is more appropriate for about 70% of Form One students to receive education in their mother tongue, but there are only 100 secondary schools (accounting for less than 20% of all the secondary schools in the territory) which have adopted the mother tongue as the medium of teaching. In this connection, will the Government inform this Council:

  1. whether it has promoted the importance of mother-tongue teaching to parents of secondary school students; if so, what are the details, and what achievement it has made in this regard; and
  2. what plans does the Government have to make more schools accept and adopt mother tongue teaching?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, the Government's policy is to encourage secondary schools to adopt Chinese as the medium of instruction, to allow individual schools to exercise discretion in the choice of their medium of instruction after taking into consideration whether their students can learn effectively in Chinese or English, and to strongly discourage the use of mixed code in schools. This policy is based on the following considerations:

  1. that teaching and learning are generally more effective through the mother tongue; and
  2. that while students can learn more effectively in their mother tongue, those who have the ability to learn effectively in English should be given the opportunity to do so if they so wish.

Since 1994, parents of Primary six students have been provided with information on their children's language ability in Chinese and English. Schools have since been categorized into three groups as follows:

  1. schools which should use Chinese as the medium of instruction;
  2. schools which may use either Chinese or English as the medium of instruction; and
  3. schools which may use Chinese or English for some classes and should use Chinese only for other classes as the medium of instruction.

At the same time, the Education Department has been vigorously promoting the benefits of mother tongue teaching by:

  1. publicizing the results of research studies undertaken by the Education Department in conjunction with the University of Hong Kong and the Chinese University of Hong Kong between 1987 and 1994 on using the mother tongue as the medium of instruction. These studies indicated that students generally learned and performed better with their mother tongue adopted as the medium of instruction, particularly in language-loaded subjects. Abstracts of these results have been distributed to all kindergartens, and primary and secondary schools. The Education Department has also produced video tapes on the basis of the information concerned. Starting from 1995, such information is also given, in the form of pamphlets, to all parents of Primary six students who will have to choose a secondary school for their children;
  2. producing posters for schools to display on parents' days;
  3. holding roving exhibitions to explain the Government's policy on medium of instruction and the findings of the relevant research studies; and
  4. organizing seminars for secondary school headmasters on how to effectively implement mother tongue teaching.

As a result of these efforts, the number of schools adopting Chinese as the medium of instruction for all subjects except English has increased from 52 in 1994 to 69 this year. In fact, some 280 secondary schools or 70% of all the secondary schools use Chinese as the medium of instruction to varying degrees. Of these, some 150 schools use Chinese for most of the subjects.

To encourage more schools to use Chinese as the medium of instruction in the coming years, the Education Department will continue to adopt preferential measures which include -

  1. providing additional teachers of English, movable partitions, wirefree induction loop systems as well as one-off library grants to enhance English teaching and learning;
  2. providing training courses to prepare teachers to teach in Chinese;
  3. providing incentives for publishers to produce good quality Chinese textbooks in various subjects ─ the Finance Committee of this Council has recently approved $54 million for implementing phase four of the incentive scheme; and
  4. compiling glossaries of technical terms in both Chinese and English for major subjects.

In addition, the Education Department is currently conducting a three-year longitudinal study starting in 1994 to gauge the effects of different modes of medium of instruction on the academic achievement and learning process of Form One to Form Three students. Based on these findings, we will formulate and issue to schools clear-cut guidelines in 1997 on the appropriate medium of instruction to be adopted from September 1998 onwards.

These efforts will be reinforced by the following publicity activities to be launched by the Department in this fiscal year of 1995-96:

  1. To organize eight seminars on the benefits of mother tongue teaching for primary school teachers in the hope that they will pass the message on to pupils and parents;
  2. To produce television programmes and Announcements of Public Interest (API) on radio, targeting specially on parents;
  3. To put up posters at MTR stations;
  4. To prepare and distribute new pamphlets to parents of Primary Four to Primary Six students; and
  5. To publicize, through the mass media, successful examples of schools adopting mother-tongue teaching, particularly the outstanding achievements of their students with a view to promote mother-tongue teaching.

The total cost of these activities is estimated at $2.6 million.

MR IP KWOK-HIM (in Cantonese): Mr President, I would like to know more about the three-year longitudinal study which commenced in 1994 that the Secretary for Education and Manpower has mentioned earlier. He said that this study sought to assess different modes of medium of instruction. I would very much like to know clearly the content of this study. Can the Secretary provide more detailed information? What specific measures can the Administration take subsequent to the completion of the study to render mother-tongue teaching more acceptable to parents?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, this study which began in 1994 and which has mainly used 60 schools as samples, seeks to examine the progress of learning of students from Form One to Form Three who are taught in different modes of medium of instruction. The main purpose of this is that we would very much like to see the findings of this study match our previous studies, thus proving that the academic achievements of students learning through their mother tongue in this period (from Form One to Form Three) are better than students being taught under the so-called mixed code teaching approach. We will subsequently implement the guidelines which have already been issued to schools on the basis of the findings. Under the guidelines which we have issued to schools, as I have explained in the main reply, it is stated that some schools should use Chinese as the medium of instruction, some may use either Chinese or English while some should use Chinese only for some classes and use English or Chinese for other classes for better results. We very much hope that the findings of the study will further boost the confidence of schools and particularly parents in the effectiveness of mother-tongue teaching so that we can issue in 1997 a set of clear-cut guidelines as I have mentioned in the main reply, advising all schools to observe the guidelines of the Education Department and formally implement the policy of mother-tongue teaching across the board from the 1998 school year onwards.

PRESIDENT: I have four more names on my list and I draw a line there.

MR CHEUNG MAN-KWONG (in Cantonese): Mr President, it is mentioned in the main reply that the Government plans to issue a clear-cut guideline in 1998 to schools which are suitable only for mother-tongue teaching, asking these schools to adopt mother-tongue teaching for the benefits of their students. Can the Government inform this Council whether this clear-cut guideline is binding or is it just a "toothless tiger"? If these schools do not comply with this guideline of the Education Department, what measures will the Government take to ensure compliance?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, the guidelines will be issued in 1997, which is, in other words, two years away. We very much hope that in the next two years, through the series of measures and promotional campaigns that I have discussed in the main reply, an increasing number of schools will follow our guidelines by adopting the kind of language that we suggest to them as the medium of instruction. In consideration of the point that the Honourable CHEUNG Man-kwong raised just now, I will look into the need to draw up certain rules when the guidelines are issued in 1997. Of course, I can say that where secondary schools in Hong Kong are concerned, public secondary schools in particular, some of them are government schools and some are subsidized by the public fund. If we need to make the guidelines binding in implementation, even though the guidelines are not legally binding, there will certainly be other alternatives that we can consider to achieve this end. However, I do not wish to make a decision now regarding to what extent the guidelines are binding because I very much hope that through our on-going efforts, more and more schools will accept the guidelines that we have already issued to them.

MR LEUNG YIU-CHUNG (in Cantonese): Mr President, I would like to follow up part (b) of the question. At present, secondary schools or secondary school teachers have found it rather difficult to accept mother-tongue teaching. The reason for that, I believe, relates to the medium of instruction at our universities because at present, as the Secretary for Education and Manpower has mentioned, it is not compulsory for our universities to adopt a particular kind of language as their medium of instruction. This has puzzled secondary school teachers who are at a loss as to how the medium of instruction used in secondary schools can be linked up to that used at our universities. There are difficulties in the convergence of the medium of instruction particularly in subjects such as science, mathematics or natural science. May I ask the Secretary this: while secondary school teachers and secondary schools are being talked into adopting mother-tongue teaching in their schools, how can the Administration convince them that the difficulties faced by their students in respect of the medium of instruction used at our universities will be eliminated?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, from what I understand as the main point of Mr LEUNG's question, he is, perhaps, worried that students who study in Chinese-medium secondary schools may face certain difficulties when they go to university. I, however, do not quite agree with him. It is because basically, we have conducted a lot of studies and we have been telling parents since 1994 that in actual fact, some 33% of students in the territory can learn through either Chinese or English while a majority of the rest of the students should learn through their mother tongue, namely Chinese, in secondary schools. For students who learn through Chinese, I think they would not have problems in other disciplines when they study at university because there are such reference books as bilingual glossaries of technical terms. I have to stress that the mother-tongue teaching approach that I have presented just now does not mean that the subject of English must also be taught in Chinese. The subject of English can be taught in English. Therefore, the point I am making is that learning through the mother tongue does not necessarily mean a lowering of the English standard. Besides, as I have mentioned in the main reply, the Government will provide plenty of support to Chinese-medium schools, which includes additional teachers of English.

MRS SELINA CHOW (in Cantonese): Mr President, as the Secretary for Education and Manpower has mentioned just now that while suggestions have been made to schools, very few schools seem to have adopted mother-tongue teaching of their own accord. There are a mere 69 schools which have adopted such approach so far while 70% of the schools have not yet accepted this approach. While that clear-cut guideline is to be issued only in 1998, can it be put across to schools earlier, telling them that this policy will definitely be implemented in 1998 so that they can make a choice earlier and actively change their language policy?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, as a matter of fact, all secondary schools know well and have received from the Education Department instructions as to which language, be it Chinese or English, should be adopted as the medium of instruction. Therefore, all schools are already aware of the guidelines. But why do we have to issue a set of guidelines in more explicit terms in 1997? As I have stated in the main reply, it is because a three-year longitudinal study was launched in 1994, seeking to collect data that are objective and which should be more convincing to both schools and parents to prove that learning through the mother tongue is effective indeed. Given that the study which started in 1994 will take three years, we can only have the findings in 1997. Such being the case, I hope to issue the clear-cut guidelines only in 1997 to dovetail with the findings of this three-year study. Yet, it does not mean that we are going to stop the measures in the interim. We will, as I have mentioned in the main reply, continue with the promotional and supportive measures concerned in order to encourage more schools to observe our guidelines.

MR ANTHONY CHEUNG (in Cantonese): Mr President, although the Secretary for Education and Manpower has mentioned in his reply just now that some research studies showed that students who are taught in their mother tongue have demonstrated better performance in learning and that the Government has provided additional resources to support mother-tongue teaching in schools, the reality is that a great majority of secondary schools are reluctant to fully adopt the mother tongue as the medium of instruction. What are the reasons for this? Is it due to resistance from parents who are reluctant to let their children learn in their mother tongue? Are they worried that their children may face difficulties when they go to university; or is it because of reservations on the part of employers? Has the Government formulated any plans before, or does it have any at present, to conduct substantial studies in an effort to solicit the opinions of the community, including those of employers, universities or parents on mother-tongue teaching?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, the question raised by Mr CHEUNG consists of several parts. First, he asked why many schools remain unwilling to observe the guidelines of the Education Department and adopt mother-tongue teaching. This is due to a number of reasons. Of course, on the one hand it is because of the attitude of parents, many of whom tend to feel that English-medium teaching will help improve their children's proficiency in English and this will be advantageous to their children in further studies and in seeking future employment. Another reason, which correlates with the above, is that some schools believe that if they switch from English-medium to Chinese-medium teaching, they might end up having to accept students with a lower academic standard owing to the attitude of parents in choosing schools for their children.

As to how we are going to allay their anxieties, first of all, as I have mentioned in the main reply, we will on the one hand publicize the effectiveness of mother-tongue teaching through promotional campaigns and on the other hand, as we have already mentioned, there is the three-year longitudinal study. We hope that more convincing and objective information will be obtained to prove the effectiveness of mother-tongue teaching. In the meantime, I also have to emphasize that we will continue to convey the message to parents that mother-tongue teaching will not in the least lower the students' English standard because the lowering of English standard may be due to a diversity of factors. Moreover, despite mother-tongue teaching, the subject of English can still be taught through the medium of English. In this connection, we will reinforce this message to parents.

Hospital Authority Merit Payments to Senior Staff

2. MR CHAN WING-CHANasked (in Cantonese): Mr President, will the Government inform this Council:

  1. whether merit payments are granted to senior executives of the Hospital Authority; if so, what are the criteria for granting such payments, which types of executives are eligible for receiving such payments, and what is the basis for determining the amount granted; and
  2. of the annual amount appropriated for such payments by the Hospital Authority over the past three years?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, the Chief Executive and Hospital Chief Executives are senior executives of the Hospital Authority whose remuneration contains a performance related element. Such payments are determined by assessment panels set up to evaluate the overall performance of individual executives in discharging their management duties and achieving agreed service targets.

In the case of Hospital Chief Executives, the assessment panel comprises members of the Hospital Authority Board as well as the respective Hospital Governing Committees, and the payment ranges from 0% to 15% of pay. In the case of the Chief Executive, the assessment panel comprises Hospital Authority Board members, and the payment ranges from 0% to 30% of pay.

The amounts of performance related payments granted by the Hospital Authority in 1992-93, 1993-94 and 1994-95 were in the order of $0.6 million, $4 million and $7 million respectively.

MR CHAN WING-CHAN (in Cantonese): May I ask the Government if it is appropriate to set up this merit payment scheme for the Hospital Authority? If the Government considers this merit payment scheme appropriate, why is it that only a small handful of people in the higher echelons are eligible for this payment? Does the Hospital Authority think that other than this small handful of people, the efforts of other members of staff are not worthy of commendation and reward?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, this merit payment seeks to provide a mechanism to ensure that the performance of senior executives is up to a certain standard. In this connection, it is necessary to establish an administrative framework and set certain targets. This is a scheme drawn up by the Hospital Authority with the approval of the Government. Under the circumstances, it is an internal administrative decision of the Hospital Authority that such payment is made to senior executives and not to be granted to other members of staff.

PRESIDENT: I have four more names on my list and I draw a line there. May I again remind Members to keep their supplementary single-barrelled and keep the preambles very, very short indeed.

MR CHAN KAM-LAM (in Cantonese): Mr President, at present, a great majority of the Government's appropriation to the Hospital Authority and the main revenue of hospitals is spent on expenses relating to manpower and staffing matters. Under this system, how can the Government prevent individual executives who seek to procure a higher merit payment from deliberately suppressing departmental expenditures so that the money will go into the pockets of these executives?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, the performance related payment is meant to reward those members of staff who can meet the targets of improving the services. This payment is drawn from the money set aside for remuneration at a designated rate. Therefore, no extra expenses will be incurred. Nor will it have any impact on the expenditure required for the provision of services to patients. The Hospital Authority has a mechanism in place to determine the eligibility of their staff for this merit payment. As I said in the main reply, in the case of the Chief Executive, an assessment panel under the Hospital Authority Board is set up and in the case of Hospital Chief Executives, a panel comprising members of the Hospital Authority Board and the respective Hospital Governing Committees is set up to assess their eligibility. Therefore, I believe there is adequate information provided for the assessment and this payment will not jeopardize the services to patients.

MISS CHAN YUEN-HAN (in Cantonese): Mr President, I am not challenging the management system of the Hospital Authority. However, the fact is that rumours are spreading in the community. From the figures just presented to us by the Government, the granting of this payment alone in 1994-95 already amounted to $7 million. If we calculate on the basis of the data that the Government has provided us earlier which indicate that there are 40 executives in the senior management level, 40 people sharing this $7 million will mean over $170,000 for each person. Given that the Hospital Authority is a non-profit-making institution, does the Government consider this merit payment scheme appropriate? I have to stress that at a time particularly when we are discussing inadequate expenditure on medical services, is it a right thing to do to adopt such a scheme?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, I think what the Honourable Miss CHAN Yuen-han has said may just be her personal opinion. But I can explain to Members that this payment has increased annually on a progressive basis because the newly introduced administrative framework is only implemented gradually. It was not commenced in full in 1992. It was only in 1994-95 that all Hospital Chief Executives required were recruited and this explains the annual increase in the payment. As for the question of appropriateness and whether this payment should be granted, the Hospital Authority can make its own decisions on the remuneration for their staff.

DR LEONG CHE-HUNG (in Cantonese): The Secretary for Health and Welfare revealed in her reply just now that the annual amount of merit payment is on the rise progressively. Does this mean that there are more and more senior executives, or that the executives are doing their jobs better and better?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): I have in fact answered half of the question. First, there has been an increase in the number of executives between 1992 and 1995. Secondly, the executives have more opportunities each year to show good performance. Thirdly, I have to point out that not all the executives will definitely be granted this payment.

MR CHOY KAN-PUI (in Cantonese): Mr President, is the morale of staff in the lower ranks affected by the merit payment and bonus scheme for senior executives of the Hospital Authority? How will the administration and operation of the Hospital Authority be affected without this scheme? In view of the concept of linking up charges with the cost, will patients be made to pay higher medical fees as a result of a rise in the cost due to this bonus system?

PRESIDENT: I think there were three questions.

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, first of all, I have to stress that the payment is not a bonus. It is a payment determined by performance and it is clearly set out in the letters of appointment that such payment is granted only on the ground of good performance. It is part of the income, not a bonus, and the Hospital Authority is, as Members have pointed out just now, a non-profit-making institution. As to the question of whether there is any impact on the morale of other members of staff, as far as I know and from the information provided to me by the Hospital Authority, the morale is not affected. The granting of this payment and the charges for medical services are two entirely different matters, which are not in the least related.

Chief Executive (Designate) and Team Designate 3.

MR LEE WING-TAT asked (in Cantonese): Mr President, as the Chief Executive (Designate) and Principal Officials (Designate) the Team Designate will be appointed in 1996, will the Government inform this Council:

  1. what is the composition of the Team Designate as the Government understands it;
  2. whether, in regard to providing assistance to the Special Administrative Region (SAR) Government (Designate) in its work during the transition, the Government will provide assistance to the Principal Officials (Designate), Executive Councillors (Designate) or the Team Designate as a whole in addition to providing assistance to the SAR Chief Executive (Designate);
  3. in what ways will such assistance be given; and
  4. whether the Government will urge the British Government to request the Chinese Government to state clearly that the secretariat consisting of a few hundred staff proposed to be set up by a member of the Preliminary Working Committee (PWC) to provide assistance to the Chief Executive (Designate) will not result in the existence of a "shadow government", and whether the Government will request the British Government to clarify if the PWC's proposal contravenes Section four of the Sino-British Joint Declaration?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, it is not for the Hong Kong Government to define for the Chinese side what the term "Team Designate" stands for. The only occasion that this term had been explained to us was in the context of discussions on the Court of Final Appeal. On that occasion, the Chinese side told us that the Team Designate would be led by the Chief Executive (Designate) and would include the Principal Officials (Designate) and others qualified to take part in the establishment of the Court of Final Appeal.

It is obviously in Hong Kong's interests to ensure that the transition will be as smooth as possible. It is, therefore, essential that we render assistance to the Chief Executive (Designate). In the Governor's policy address, we have already undertaken to do so. The details and the form of such assistance will need to be discussed with the Chinese side.

Under the Joint Declaration, the administration of Hong Kong before 1997 will remain a British responsibility. We have made it clear that we will maintain effective administration of the territory and will not accept any parallel or shadow government. We have noted from recent press reports that the Chinese side have affirmed their support for this principle and that there should not be an alternative centre of power before 30 June 1997.

MR LEE WING-TAT (in Cantonese): By this time next year, there will be many organizations relating to the transition of the Hong Kong Government emerging, including the Preparatory Committee. The Chief Executive (Designate) will be known; and the Executive Councillors (Designate) and Principal Officials (Designate) after 1997 may be appointed in parallel with the existing Administration. How can the Secretary for Constitutional Affairs assure us that the discussions of these many organizations and the views they openly express will not interfere with the operation of the Hong Kong Government and will not affect the effectiveness and the authority of the existing Government in governing Hong Kong, as consistently emphasized by the Chief Secretary?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, I would like to reiterate and stress again the provision in the Joint Declaration. It provides very specifically and very clearly that the administration of this place would be the responsibility of the British Government before 1 July 1997. So there is no question of us abdicating; there is no question of us being confused or confounded by discussions or happenings elsewhere. We would continue to maintain a very effective administration of this place before l July 1997.

PRESIDENT: I have four more names on my list, and I will draw a line there.

DR YEUNG SUM (in Cantonese): Mr President, since the Government will establish a liaison office to maintain co-operation with the Team Designate, can the Government inform this Council how such liaison office will report to Members of the Legislative Council? Will it consult Members before any important decision is made?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, as I have explained to Members of the Constitutional Affairs Panel on a number of occasions and as the Governor has indeed also explained in his previous Question and Answer session, our assistance to the Preparatory Committee and in future the Chief Executive (Designate) will be on the principle of openness and transparency and we certainly would keep the Legislative Council fully in the picture of the Hong Kong Government's activities in relation to co-operating with the Preparatory Committee. Of course, it is not the Hong Kong Government's responsibility to explain on behalf of the Preparatory Committee what it does, how it operates and why it operates in a particular fashion. But insofar as the Hong Kong Government's co-operation with the Preparatory Committee is concerned, we would certainly keep Legislative Council Members and the community at large generally informed of our activities. And I would like to also remind Members that our co-operation with the Team Designate, the Preparatory Committee and the Chief Executive (Designate) will be on the three important principles. Firstly, we would not do anything that would be against the Joint Declaration and the Basic Law. We would not do anything that would compromise the Hong Kong Government's commitment to governing this place effectively before 1 July 1997, and we certainly would not do anything that would put civil servants into a position of double or conflicting loyalties.

PRESIDENT: Are you claiming your question has not been answered, Dr YEUNG?

DR YEUNG SUM (in Cantonese): Yes, I am, Mr President. It is because I have also asked the Secretary whether Members of the Legislative Council will be consulted before any important decision is made.

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, I do not quite understand what Dr YEUNG means by "before any important decision is made". Certainly, any decision made by the Preparatory Committee is not a responsibility of the Hong Kong Government. But insofar as how we co-operate, how we help the Preparatory Committee, we have made a commitment that we will certainly keep the community at large, including the Legislative Council, informed of developments. So there is no question of us making a decision on a particular subject. The general mode of co-operation, the general method of co-operation, the general system of co-operation obviously is something that we would let the Council and community know about, and our activities would be fully transparent and fully open. So it is not a question of us doing anything secretly.

MR CHIM PUI-CHUNG (in Cantonese): Mr President, under the existing system of the British Government, the ruling Conservative Party invariably forms its cabinet. The opposition party, namely the Labour Party, also has its shadow cabinet. This should be particularly the case for Hong Kong, which is now in a transition period in the run-up to 1997. In this connection, does the Government consider the establishment of a shadow government or cabinet reasonable and necessary so long as these organizations do not influence the operation of the existing Hong Kong Government?

PRESIDENT: Mr CHIM, are you seeking an opinion from the Secretary, or are you asking for the Government's position on the existence of a Preparatory Committee?

MR CHIM PUI-CHUNG (in Cantonese): Mr President, I raised this question mainly because of the strong resistance of the Government to a shadow cabinet or government. But if these organizations do not affect the operation of the Government, it should be unnecessary to put up any resistance to them. So what is the attitude of the Government towards a shadow government or cabinet which does not affect the operation of the Government?

PRESIDENT: Are you prepared to rephrase your question along my lines?

MR CHIM PUI-CHUNG (in Cantonese): Mr President, most importantly, ......

PRESIDENT: Mr CHIM, you have to rephrase your question.

MR CHIM PUI-CHUNG (in Cantonese): All right, Mr President. Let me re-organize my question. I am saying that ......

PRESIDENT: I am sorry, you have stated your view twice. You are not asking a question, you are seeking Mr NG's personal view on a term called "shadow government".

MR CHIM PUI-CHUNG (in Cantonese): Mr President, my question is this. The Secretary for Constitutional Affairs stated in paragraph three of his reply that the existence of a shadow government will not be accepted. If the so-called shadow government does not affect the operation of the Government, how will the Government deal with this issue? I would not mind if you rule that it is inappropriate for the Secretary to answer this question.

PRESIDENT: Secretary, the Government position, not your personal view please.

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, with your tolerance, I will try to answer the points raised by Mr CHIM.

We have obviously undertaken to provide the Chief Executive (Designate) with the necessary assistance to help him to prepare for the formation of the SAR Government, but the thing to remember is that prior to 1 July 1997, the administration of this place rests in the hands of the Hong Kong Government, through the British Government's responsibility and therefore any planning or preparation by the Chief Executive (Designate) and his supporting team should not undermine the authority of the current Administration and we just fail to see how the question of shadow government comes into the debate. We would be responsible for running this place before 1 July 1997, and indeed Mr CHIM should note, as mentioned in my principal answer, that the Chinese senior officials, and only last week, at least two or three of them, have recently clearly indicated that there would not be any question of a second power centre or a shadow government existing in Hong Kong before 1 July 1997.

MISS EMILY LAU (in Cantonese): Mr President, the Government said in the reply that the details and the form of assistance to be rendered to the Team Designate will need to be discussed with the Chinese side. However, neither do I believe nor accept that the Government, at this point in time, does not have any initial proposal in this regard. I have already put this question to the Chief Secretary when she was here last week. It is my hope that the Government can reveal more information to Members today. As the Government has frequently stressed the high transparency in the future operation of the Government, but if the Government refuses to tell the people of Hong Kong anything right from the start, I think nobody would believe that the Government would, in actual reality, let us know more. Therefore, Mr President, I hope that the Government can tell us right away how does the Government plan to deal with the Chinese Government and what sort of questions will be raised for discussion in an effort to provide assistance?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, I am really surprised to hear Miss LAU saying that we have not said anything about how we are going to help or co-operate with the Preparatory Committee. I will leave the Chief Executive (Designate) for the moment because obviously the Chief Executive (Designate) would have at least another year to go, or at least a long while to go before we would need to face that scenario. But insofar as co-operating with the Preparatory Committee is concerned, if Miss LAU would care to refer to the 1995 Governor's policy address, paragraphs 133 to 137, we did set out the broad framework of how we were to co-operate. We suggested that we would establish a liaison office as a focal point of contact within the Hong Kong Government, as a focal point of liaison, as a focal point of provision of information to the Preparatory Committee. Now the actual size of the liaison office and the actual detailed operation as to how many meetings we hold, are obviously some of the details that we would need to discuss and would need to unfold depending on how the Preparatory Committee would operate in detail or in actual reality. But the framework is clearly set out and the principles of that co-operation are again very clearly set out in the 1995 policy address. With those principles and within that framework, we will be able to co-operate in an effective way with the Preparatory Committee and I can assure Miss LAU that if there are major departures from that framework, from those principles, the Legislative Council will be the first organization to hear about them.

MR HOWARD YOUNG: Mr President, the Secretary for Constitutional Affairs refers in his second paragraph that the details and form of such assistance will need to be discussed with the Chinese side. I would like to know whether this is inferring that the Government plans to have the details and anything to do with assistance only discussed with the Chinese side, which I take it to mean through diplomatic channels, or will it be feasible also that once the Chief Executive (Designate) is known, then surely he should be able to directly discuss with the Hong Kong Government rather than him having to talk to Beijing, Beijing to talk to London, London to talk to Hong Kong, in a very roundabout way? Could the Secretary please clarify this point?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, we certainly do not close our mind to any possible avenues of communication with the Chinese side, on any matter affecting the transition, including of course, how we co-operate with the Preparatory Committee and the Chief Executive (Designate). Mr YOUNG is quite right in pointing out that apart from the established diplomatic channels, there are other opportunities, there are other occasions, there are other well-established avenues where we can communicate with the Chinese side, and as for his reference to when the Chief Executive (Designate) is around, that will be another avenue for us to communicate directly and more conveniently in dealing with the Chinese. It is obviously something we would bear in mind.

PRESIDENT: I will allow one more supplementary as I had overlooked the fact that Mr CHAN Kam-lam had pressed the request to speak button much earlier on.

MR CHAN KAM-LAM (in Cantonese): Mr President, the Secretary for Constitutional Affairs stated in his main reply that it is obviously in Hong Kong's interests to ensure that the transition will be as smooth as possible and it is, therefore, essential that we render assistance to the Chief Executive (Designate). Given that the officials (designate) will be appointed in 1996, may I ask the Government if it should provide the Chinese Government with information of our government officials as soon as practicable so that the Chinese side and the Chief Executive (Designate) will be able to start the work relating to the appointment of officials?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, obviously we would provide any information that is necessary or useful to help the Chief Executive (Designate) in the establishment of a new government. But I would not like, at this stage, to speculate as to what exactly would be the type of information that would be required by the Chief Executive (Designate). Our general commitment is to help him as far as we can, but against the three principles, the three broad principles that we have set out. So we would not do anything that would be against any of the three principles.

First-time Home Ownership

4.MR ERIC LI asked (in Cantonese): Since June 1994, the Government has implemented administrative measures to regulate property transactions and a curb property prices in order to enable families in need of a home to have the opportunity to purchase homes for the first time at relatively reasonable prices. In this connection, will the Government inform this Council:

  1. of the number of new residential flats completed between June 1994 and October this year;
  2. what is the number of flats for which transactions have been concluded during the above-mentioned period; whether there is information to show how many of the transactions are in respect of flats purchased by first-time home-buyers; and what is the average vacancy rate during the period in question; and
  3. whether the number of first-time home-buyers and the number of new residential flats referred to in the above-mentioned period have shown an increase when compared with the corresponding figures in each of the three years immediately before the implementation of the measures to regulate property transactions; if not, what are the reasons?

SECRETARY FOR HOUSING (in Cantonese): Mr President, since the introduction of the anti-speculation measures in June 1994,

  1. the number of new residential flats completed up to October 1995 is 76 107 units, including all private and public housing flats;
  2. the number of transactions concluded during the same period is 128 738. No separate statistics are kept on the number of transactions involving first-time home-buyers. The vacancy rate for private domestic flats, which is compiled on an annual basis, was 4.7% in 1994;
  3. the number of new residential flats competed has increased by 4%, 8% and 23% when compared with those in the past three years respectively immediately before the introduction of the new measures.

MR ERIC LI (in Cantonese): Mr President, I think my question is clear enough. It is about the supply of private housing units and their transactions. However, I am disappointed that the reply is incongruous with the question in that it has mixed up the issue with public housing. I am still unable to get a full picture of the outcome reflected by the measures taken. First of all, I hope the Administration would supply us with correct information so that the public may not be misled. The second point, though less obvious, is whether these measures have enabled families in need of a home to purchase homes for the first time. I am sure that such information is what we in this Council want to know. It has now become obvious that these measures have not only lowered the prices of private properties but also reduced their speculation activities. At the same time, the supply of medium-and long-term housing has also decreased. There are less and less suitable private residential flats to attract purchasers, resulting in the presence of many "flats without occupancy". Now, 17 months after the introduction of these measures, the Administration has the audacity to tell us that it still does not know whether or not these measures have enabled those in need of a home to purchase their own homes.

PRESIDENT: What is your question, Mr LI?

MR ERIC LI (in Cantonese): The Administration is even unable to supply us with statistics. Will the Administration assure us when it will carry out a review of the misguided policies so as to let us know, firstly, whether it will increase the supply of medium- and long-term private housing, not just land supply (unless it is the intention of the Administration that the people should sleep on streets) and secondly, whether it can supply us with correct figures to show if families in need of a home have the opportunity to purchase their own homes?

SECRETARY FOR HOUSING (in Cantonese): Mr President, the Honourable Eric LI has accused me of giving him a confused reply, but I have replied in accordance with the question asked. With your permission, I would like to provide additional information about private property transactions of the past three years or so. The numbers of transactions of private properties were 86 219 in 1992-93, 111 108 in 1993-94 and 111 832 in 1994-95.

As to providing middle-income families with the opportunity to purchase their own homes, I think the SECRETARY FOR HOUSING has on a number of occasions pointed out that there are at present various programmes to help such families to purchase their own homes. In fact, Members have already been provided with so much information on public housing that they may probably not want to hear any more about it. As to private housing, we are of the opinion that there should be enough supply of land to encourage more residential flats to be built. The Government now envisages that 195 000 private residential flats will be built by 2001, hoping that this will help families in need of a home to purchase their own homes. As to programmes to encourage families to purchase their own homes, the Government has, as you all know, gone a long way towards helping the sandwiched class, that is, the middle-income families to achieve this goal. We hope to build at least some of the residential flats for them to purchase. With the increase in the number of public and private housing units during the next few years, I am sure that families wishing to purchase their own homes will have the opportunity to do so.

PRESIDENT: Mr LI, I have to allow time for other Members. I will have to draw a line there.

MR ERIC LI (in Cantonese): Mr President, the Secretary has failed to answer my question which is very simple. We all know that the Housing Branch has many programmes on hand, but what I have asked is: When will the Administration really have a review of the relevant policies carried out? The Administration has never mentioned this point. My second point is about figures. When on earth will the Administration provide us with the figures required? These are the two major points which the Secretary has failed to respond to.

SECRETARY FOR HOUSING (in Cantonese): Mr President, the review report has already been submitted to the Housing Branch. As the relevant figures are still under study, I am unable to provide you today with the exact figures required. Generally speaking, there should not be much difference between the figures of the review and the target figures set by the Government.

DR LAW CHEUNG-KWOK (in Cantonese): Mr President, many people are of the opinion that the slump in the second-hand property market is mainly due to the fact that the Administration has gone too far in interferring with the property market. What factors will the Administration consider in deciding whether or not to relax regulation of the property market?

SECRETARY FOR HOUSING (in Cantonese): Mr President, it would seem that the second-hand property market has somewhat revived during the last month, as can seen from newspaper reports. The programmes introduced by the Government last year have now achieved the expected results. As to private property transactions, we can all see that the market has begun to revive and therefore I think there is no need at the moment to interfere with it or to provide it with any assistance.

MR JAMES TIEN (in Cantonese): Mr President, will the Administration supply this Council with information to indicate how many private building plans have been approved this year, that is, in 1995? I ask this question because, based on the number of building plans approved this year, we can forecast how many buildings will actually be completed in three years. We can thus tell if the number of buildings completed will greatly decrease, as pointed out by the Honourable Eric LI.

SECRETARY FOR HOUSING (in Cantonese): I am sorry, Mr President. I do not have such information off hand, and so I cannot answer this question.

PRESIDENT: Could that figure be supplied in writing subsequently, Secretary?

SECRETARY FOR HOUSING: Yes, Mr President. (Annex I)

MR LEE WING-TAT (in Cantonese): Mr President, everybody knows that the most important way to regulate or to stabilize property prices is to have a steady supply of a large number of private properties. However, there are three unfavourable factors which have worried me a great deal. First, according to the information provided by the Rating and Valuation Department, the production of private properties in 1993 and 1994 was lower than expected. Secondly, there have been fewer redevelopment sites in urban areas. Thirdly, the record vacancy rate of 4.7% means that about 50 000 private domestic flats are vacant. Will the Secretary for Housing ascertain whether these three unfavourable factors will in the long run cause considerable obstruction to the target of providing sufficient private domestic flats for the public? If so, what are the solutions?

SECRETARY FOR HOUSING (in Cantonese): Mr President, the Government has set up a Housing Project Action Team to look into the matter of land supply. As long as the number of flat units exceeds 500, the Team will try its best to help the responsible organization, be it the Housing Authority, the Housing Society or even a private organization, to solve the problem of land supply, or take whatever action to co-operate with the organization concerned. The Team is chaired by the Secretary for Housing. As regards the vacancy rate of 4.7% which means about 50 000 housing units are vacant, I think the vacancy rate has remained at more or less the same level recently. There is no indication that this year's figure is particularly high or particularly low. It has remained at this level during the past few years.

PRESIDENT: Mr LEE, not fully answered?

MR LEE WING-TAT (in Cantonese): I would like to clarify one point. The Secretary for Housing has mentioned that during the past few years, the vacancy rate has remained at 4.7%, which means some 50 000 housing units are vacant. Will the Secretary for Housing inform us of the private housing vacancy rates of the years from 1991 till now? As far as I can remember, the lowest rate is 3.9% and the highest, 4.7%.

SECRETARY FOR HOUSING (in Cantonese): Perhaps I will provide a written reply. (Annex II)

Broadcasting Bill

5.MR ANDREW CHENG asked (in Cantonese): Mr President, the Government indicated to this Council on 2 November 1995 that it would seek the views of interested parties and consult the Chinese side on the Broadcasting Bill (the Bill). In this connection, will the Government inform this Council:

  1. how it will go about seeking such views; whether it will conduct public consultations on major issues arising from the Bill, such as the restrictions on "cross media ownership" and the regulation of "interactive multimedia services", and
  2. what progress has been made to date in its consultation with the Chinese side on the Bill; and what are the specific details of the consultation?

SECRETARY FOR RECREATION AND CULTURE (in Cantonese): Mr President, as drafting of the Bill is still underway, we have not yet decided precisely how the consultation should be conducted, and neither have we initiated consultations with the Chinese side. However, I can say that it is our intention that all interested parties will have an opportunity to comment on all matters in the Bill, and that all comments received will be considered carefully before the Bill is finalized for approval by this Council.

MR ANDREW CHENG (in Cantonese): The Government told this Council in the last Session that it would submit the Bill for deliberation by this Council. We, however, find it very disappointing that the Government did not honour its undertaking. Now the Government is saying again that it would table the Bill at this Council in this Session. Yet, the basic details of the consultation exercise have not been decided while the Chinese side still needs to be consulted. We all know that if the Chinese side is to be consulted on bills which are closely related to the freedom of speech ......

PRESIDENT: Please come to the question, Mr CHENG.

MR ANDREW CHENG (in Cantonese): ...... there will certainly be many people who wish to know more about the Bill. However, the Government has not started consulting the Chinese side and its reply to this Council was extraordinarily brief. For this reason, I deliberately speak at greater length to show my dissatisfaction. May I ask the Government how it can convince the public that the Government would proceed with the drafting of the Broadcasting Bill in this Session? If the Government is not going to proceed with this task, it should say so honestly and should not deceive us.

SECRETARY FOR RECREATION AND CULTURE (in Cantonese): The Honourable Andrew CHENG was disappointed because my reply was too brief. In fact, I painstakingly did so with good intentions. It is because Members have been spending more and more time on the question session so I hope my words can be succinct and to the point by saying only what is needed and leaving out things which are deemed redundant.

I absolutely disagree with Mr CHENG's allegation that we have been deceiving the Legislative Council or members of the public. Mr CHENG can criticize me for being incompetent, brainless or even mediocre. I can stand the most scathing criticizms of all sorts but I have never deceived anybody. We are making an on-going effort in drafting the Bill and we hope we could submit the Bill as early as possible for Member's deliberation.

MRS ELIZABETH WONG: Mr President, I think the Secretary has given a perfect answer to justify negativity and also prolonged delay. I do not think any other civil servant can emulate his perfection. I have heard previously of baking a chestnut cake. I think it is a hard nut to crack. We are still cracking the chestnut.

Will the Secretary inform this Council of the approximate timetable when he is likely to submit his Bill to this Council?

SECRETARY FOR RECREATION AND CULTURE (in Cantonese): Mr President, I am grateful to the Honourable Mrs Elizabeth WONG for thinking so highly of me. I think not many officials here can give a reply which is commended by Members as perfect and I think I deserve it. I can assure Members that it is definitely not a chestnut cake that is being taken out from the oven because chestnut cake would always be the last thing I choose to eat. In response to the question raised by Mrs Elizabeth WONG, I can only recapitulate that at present, the drafting of the Bill is still underway and we hope we could submit the Bill for Members' deliberation as early as possible. Besides, I can only reiterate, as the Acting Secretary for Recreation and Culture said in the written reply to a question on 2 November 1995, that it has always been the plan of the Government to submit the Bill for Members' deliberation in this Session. However, as to the question of when exactly the Bill will be tabled, it will depend on the progress of the drafting work and the time required for consultation with interested parties.

WRITTEN ANSWERS TO QUESTIONS

New Posts in the Political Adviser's Office

6.MISS EMILY LAU asked (in Chinese): It is learnt that three new posts have been created in the Office of the Political Adviser. In this connection, with the Government inform this Council

  1. of the reasons for the creation of these new posts;
  2. of the salary scale and area of responsibilities of each of the posts; and
  3. from which departments the officials presently holding these posts were transferred and what posts did they hold in the departments concerned?

CHIEF SECRETARY: Mr President, the Political Adviser's Office has recently been reorganized, on a trial basis, to bring together those functions of the Hong Kong Government which derive directly from the United Kingdom sovereignty and which will cease in June 1997 when the office will be wound up. This has involved the transfer of certain responsibilities and loan of posts from other Secretariat Branches. The answers to the specific questions are as follows:

  1. No new posts have been created on the establishment of the Political Adviser's Office. However as a result of the reorganization, there are now three additional officers designated as Deputy Political Advisers. Two of these posts are on loan from other Secretariat Branches; the third is an officer filling an existing post which has been retitled;
  2. All these officers are filling existing AOSGC posts at the D2 level. The Deputy Political Adviser (Security) post deals with certain security issues related to the United Kingdom sovereignty. The Deputy Political Adviser (General) post is responsible for contributing to the China advice function and supporting the Political Adviser as a member of the Joint Liaison Group;
  3. The Deputy Political Adviser (Security) is filling the post of Principal Assistant Secretary (Security) D currently on loan from Security Branch. The Deputy Political Adviser (Personnel) is holding the post of Principal Assistant Secretary (Civil Service) Development on loan from Civil Service Branch. The third post, Deputy Political Adviser (General) is an existing AOSGC directorate post in the Political Adviser's Office which has been retitled.

Educational Needs of New Immigrant Children

7. MR EDWARD HO asked (in Chinese): Since the middle of this year, the number of Chinese immigrants arriving daily in the territory for permanent residence has increased from 105 to 150 and many of these immigrants are school-age children. In this connection, will the Government inform this Council:

  1. whether, in the light of the increasing number of children (aged six to 12) from mainland China settling in the territory, the Education Department (ED) has made any assessment and co-ordination of their educational needs at various levels of schooling in the next five to 10 years; if so, what are the details of the assessment and co-ordination plan; if not, why not; and
  2. whether the ED has set up any task force to provide assistance and counselling to such children and their parents to cope with the difficulties the children may encounter in their studies?

SECRETARY FOR EDUCATION AND MANPOWER: Mr President,

  1. To meet the demand for primary school places from an increasing number of Chinese immigrant children who are aged between six and 12 over the next few years, we are committed to building five additional primary schools for completion in 1997-98. In the interim, we are making use of the existing vacancies in primary and secondary schools resultant from an overall decline in our school population to accommodate these children. We shall conduct a review of the longer-term requirements for school places at different levels, including secondary schools, as well as the various support services in 1996.
  2. There is close co-ordination among various sections in the Education Department in the provision of services to immigrant children and their parents. These services include school placement, tailor-made induction programme, remedial teaching, and guidance and counselling service.

On guidance and counselling, student guidance officers/student guidance teachers are stationed in primary schools to assist in:

  1. promoting pupils' positive behaviour, strengthening their motivation towards learning and enhancing their self-esteem;
  2. training on study or social skills so as to enable the pupils to cope with their learning, adjustment or behavioural problems; and
  3. providing individual guidance to help them deal with more complicated adjustment, social or family problems.

Regarding parents, the Education Department has provided subvention to 14 non-government organizations in the 1995-96 school year to run short adaptation courses for adult immigrants. The course contents include the technique to help them cope with the difficulties their children encounter in studies.

The Home Affairs Department has been tasked to monitor and assess the services provided for new arrivals from China to ease the process of integration, to identify groups who are specially at risk, and to recommend the most suitable approach for responding to the practical problems as they emerge.

Reconstruction of Roads in the New Territories

8. MR CHOY KAN-PUI asked (in Chinese): At present, there are still a number of roads in the New Territories which were constructed by the Government many years ago and which have all the time been managed by the Government. These roads, which include Fan Kam Road, the Yuen Long Section of Lam Kam Road and Kam Tin Road, can no longer meet the current standards for highways nor can they cater for the needs of the rapid developments in the New Territories. In view of this, will the Government inform this Council:

  1. of the total number of such roads in the New Territories at present, together with their names and locations; and
  2. whether the Government has formulated a timetable for the reconstruction of these roads to meet the current road standards so as to ensure the safety of road users; if so, what are the respective dates for the commencement and completion of the reconstruction work; if not, why not?

SECRETARY FOR TRANSPORT: Mr President, the road network in the New Territories has developed over the past 50 years. At the time individual roads were constructed, they all fully met the then prevailing standards. Higher standards have evolved over the years resulting in better and more modern roads. However, this does not mean that the other roads are either unsafe or of an unacceptable standard.

It is fully recognized that with the pace of development in the New Territories, some existing roads may not be able to cope with increased levels of traffic. These roads need to be improved. The Lam Kam Road (Yuen Long Section) and Kam Tin Road fall into this category.

The improvements currently proposed cover:

  1. the widening of Kam Tin Road in two stages from the existing single carriageway to dual-two carriageway. The first stage from Au Tau to Kam Tin will start in early 1998 and is scheduled for completion in early 2000. The second stage from Kam Tin to Lam Kam Road will start in 2002 and is scheduled for completion in 2005; and
  2. the widening of Lam Kam Road from Kam Tin Road to Kadoorie Farm from the existing single carriageway to possible dual-two carriageway. This is scheduled to start in 2002 for completion in 2005.

A reconstruction and maintenance programme for Fan Kam Road, Kam Sheung Road, Yuen Long Section of Castle Peak Road and Route Twisk is also in hand and will be completed over the next five years. Improvement measures will include the provision of proper footpaths and drainage.

As regards minor roads, traffic management measures are implemented to maintain safe and efficient movement of traffic. For example, where necessary, speed limits are imposed or certain categories of vehicles are prohibited.

We shall continue to upgrade the road network to keep pace with traffic demand.

Servicing "999" Calls

9. MRS SELINA CHOW asked (in Chinese): It was reported that a member of the public recently had dialed "999" to report a bank robbery but only to receive the recorded reply "the line is busy". In view of this, will the Government inform this Council:

  1. of the average number of police communication personnel responsible for answering "999" calls and the average number of calls they have to handle per shift at present, and how do these figures compare with the corresponding figures in each of the past three years;
  2. of the total number of calls made to "999" to report crime which received the recorded reply "the line is busy" this year;
  3. of the average time currently taken for a call to "999" to be answered by the staff manning the number, and how does this figure compare with those of the past three years?

SECRETARY FOR SECURITY: Mr President, the answers to the three parts of the question are as follows:

  1. There are 18 Police Communications Officers and three Senior Police Communications Officers manning the "999" Consoles per shift in the three Police Regional Command and Control Centres in Hong Kong Island, Kowloon and New Territories. The number of staff deployed for such duties is the same for the past three years. In the first 10 months of this year, each shift handles an average of 445 calls. The average figures for 1992, 1993 and 1994 are 328, 338 and 401 respectively.
  2. The pre-recorded bilingual broadcast message was introduced in September 1994. Our computer system does not capture statistics on the number of calls answered by the message. However, the pre-recorded message invariably asks the caller not to hang up in order that the call could be dealt with as soon as possible.
  3. While we do not have statistics on the average time taken to answer a "999" call in the past three years, the findings of a recent snap-shot survey conducted by the police show that on an average a "999" call is answered within six seconds. It is possible that a caller may need to wait longer than six seconds to get through when a major incident takes place. However, this does not affect the response time of the police because such cases are often reported by more than one caller. For example, in the case referred to in the question, the police received two other reports of the same case at the time of the bank robbery. It should be noted that the first police officer arrived at the scene six minutes from the receipt of the calls.

Implementation of Matrimonial Causes (Amendment) Ordinance 1995

10. MRS MIRIAM LAU asked: The Matrimonial Causes (Amendment) Ordinance 1995 was passed by this Council on 17 May 1995 but it shall come into operation on a day to be appointed by the Secretary for Home Affairs by notice in the Gazette. Will the Government inform this Council of the reasons why, after a lapse of six months since its passage, the Ordinance has still not come into operation; and when it is expected that a notice will be published in the Gazette to bring the Ordinance into operation?

SECRETARY FOR HOME AFFAIRS: Mr President, I share the Honourable Member's wish for the Matrimonial Causes (Amendment) Ordinance (the Amendment Ordinance) to be brought into operation as soon as possible. However, before this can be done, it is necessary for the Matrimonial Causes Rules (the Rules) to be amended to bring court procedures in relation to matrimonial proceedings in line with its provisions. Amendments to the Rules are made by the Chief Justice. The Home Affairs Branch has been co-ordinating the preparation of the necessary amendments to the Rules. The relevant professional bodies are currently being consulted on an advanced draft. We expect to be able to finalize the amendments to the Rules and submit them to the Chief Justice for consideration within the next few weeks.

The Amendment Ordinance will be brought into force at the same time the amendments to the Rules to be made by the Chief Justice come into effect.

Misleading Advertisements

11. MR SIN CHUNG-KAI asked (in Chinese): As certain advertisements broadcast on television and radio, or carried in newspapers and magazines, contain incorrect or exaggerated information which mislead the consumers, will the Government inform this Council:

  1. which government department is responsible for dealing with complaints about advertisements containing incorrect information and how such complaints are handled;
  2. of the number of complaints about advertisements containing incorrect information received by the department concerned, as well as the number of companies which have been prosecuted as a result of such complaints in the past three years; and
  3. what regulatory measures have the Government put in place to ensure that advertisements released through the mass media contain no misleading or incorrect information?

SECRETARY FOR RECREATION AND CULTURE: Mr President, the Broadcasting Authority (BA) issues Codes of Practice in respect of advertising on radio and television. Broadcasters are required under their licence conditions to adhere to these Codes, and to exercise reasonable care and diligence to ensure that the factual claims made in advertisements are correct. Through its executive arm, the Television and Entertainment Licensing Authority (TELA), the BA monitors broadcasts to check for compliance and also acts on public complaints. The BA may warn broadcasters who contravene the Codes, or impose a financial penalty up to a maximum of $250,000. During the last three years, TELA received 110 complaints alleging incorrect information in advertisements broadcast on television and radio. After investigation, 80 of these complaints were found not to have contravened the Codes. Of the remainder, warnings were issued in 27 cases, and three cases have yet to be considered by the BA.

There is no overall control of advertising in the print media, although a variety of Ordinances governs specific types of advertisements. The Undesirable Medical Advertisements Ordinance (Cap. 231) regulates advertisements promoting medical treatments, and is administered by the Department of Health. That Department regularly screens newspapers and warns those who publish undesirable advertisements (or cause them to be published). Where warnings do not suffice, the cases are referred to the police. Over the past three years, 220 warnings have been issued, and six prosecutions taken out.

Under the Protection of Investors Ordinance (Cap. 335), the authorization of the Securities and Futures Commission ("SFC") is required for all advertisements which contain a public offer of securities or investment arrangements, unless otherwise exempted. The SFC authorization vets such advertisements prior to issue for, among other things, incorrect, exaggerated or misleading information. In addition, the SFC also monitors the local papers for unauthorized advertisements and acts on complaints. Over the past three years, it has acted on 15 complaints, mostly by requiring the offending advertisements to be amended or withdrawn. Eight prosecutions have been mounted in recent years.

The Consumer Council also assists consumers to obtain remedies when they complain of incorrect or exaggerated information in advertisements, although it has no powers of prosecution. If appropriate, the Council may refer the case to the Customs and Excise Department for further examination under the Trade Descriptions Ordinance (Cap. 362). Statistics on the number of complaints about advertisements in the print media received by the Consumer Council are not readily available as complaints are entered by product or service specific categories.

Safety Standards for Glassware Products

12. MR CHAN KAM-LAM asked (in Chinese): Will the Government inform this Council:

  1. of the number of accidents involving industrial and household glassware products and installations in the past three years; and
  2. whether it will consider introducing regulations to stipulate the safety standards for glassware products and to require manufacturers to specify on their products the types of glass used and the level of durability measured in an impact-test?

SECRETARY FOR TRADE AND INDUSTRY: Mr President,

  1. We do not have statistics on the number of accidents involving industrial and household glassware products and installations. Industrial accident statistics are analyzed by cause and by industry. There is no breakdown by either the material or the equipment involved in industrial accidents. The Hospital Authority compiles patient statistics according to international classification of diseases. It does not have separate figures on the number of accidents involving use or installation of glassware products.
  2. The safety of glassware products for private use or consumption is already covered by the Consumer Goods Safety Ordinance, which came into force in October this year. This Ordinance imposes a statutory duty on manufacturers, importers and suppliers of consumer goods (including glassware products) to ensure that the goods they supply in Hong Kong are safe. Section 4 of the Ordinance further requires that consumer goods (including glassware products) supplied in Hong Kong must comply with a general safety requirement which includes, inter alia, the adoption of reasonable safety standards published by a standards institute. Any supplier who fails to comply with the requirement under the Ordinance commits an offence. The Commissioner of Customs and Excise will monitor the situation and take enforcement action as appropriate.
    Accordingly, we do not see the need to introduce specific regulations to stipulate the safety standards for household glassware products and to require manufacturers to specify on their products the types of glass used and the level of durability measured in an impact test.

Relocation of Methadone Clinic to Tsui Ping Estate

13. MR FRED LI asked (in Chinese): The 10-year redevelopment programme for Kwun Tong Town Centre proposed by the Land Development Corporation includes the relocation of the methadone clinic at the Town Centre to Tsui Ping Estate nearby. As methadone clinics often bring nuisance to the community in which they are located, will the Government inform this Council:

  1. whether it will consult local community groups and residents in this regard; if so, what are the details; if not, why not;
  2. whether the Government will make alternative arrangements to set up the methadone clinic further away from Tsui Ping Estate in view of the worsening drug abuse problem in that Estate; and
  3. what long-term and interim measures the Government has adopted to tackle the drug abuse problem in the neighbourhood of Tsui Ping Estate?

SECRETARY FOR SECURITY: Mr President,

  1. The Kwun Tong Town Centre Redevelopment Scheme proposed by the Land Development Corporation (LDC) is still being considered by the Corporation and the Administration. If the Scheme is to be implemented, the Kwun Tong District Board, and other relevant local bodies, where appropriate, will be consulted in advance on any proposal to relocate the methadone clinic.
  2. No decision has been made on whether and where the methadone clinic in Kwun Tong should be relocated. The Government is open-minded about the location of methadone clinics. An important consideration is the accessibility of the clinic, as the objective of the methadone programme is to offer a readily accessible out-patient service for those drug abusers who seek treatment but, for various reasons, would not be able to take part in residential treatment programmes.
  3. The drug abuse problem in the neighbourhood of Tsui Ping Estate is being tackled at source by stepped-up law enforcement action, and preventive education and publicity.
    Police enforcement action against drug activities in Tsui Ping Estate has been stepped up. This can be seen from the number of arrests for serious narcotics offences in Tsui Ping Estate, which has increased from 46 in 1994 to 80 in the first nine months of 1995. At the street level, enhanced enforcement actions are taken on a daily basis against drug sellers and users. Information and intelligence on drug activities, with particular emphasis against drug sellers, are collected, collated and acted upon by the Kwun Tong District Special Duties Squad to target known drug sellers.
    The police also contributes to anti-drug education by organizing school visits and seminars with school headmasters and discipline masters, focussing on the prevention of drug abuse by students.
    Extra efforts have been put in preventive educational and publicity measures to arouse awareness among Kwun Tong residents on the drug problem. Emphasis has been laid on enhancing parents' understanding on the prevention and early detection of their children's involvement in drugs. In 1995-96, a total of seven programmes involving 10 000 participants have been/will be implemented by the social welfare service units in the district. Existing counselling services of family service centres and probation offices in the district have also been strengthened to help young people with drug problems and their families.
    The District Social Welfare Office (DSWO) in Kwun Tong has formed a Working Group on "District-wide publicity campaign in combating illicit use of drugs among young people in Kwun Tong District" in April*1995, to promote co-ordination and co-operation among government departments and local organizations to tackle the drug problem. A "Drug Ambassador Scheme" is now being launched by the Working Group, with the aim of publicizing widely anti-drug messages among young people through a signature campaign. So far over 7 000 participants from more than 30 local organizations have been enrolled. The Working Group also compiles leaflets on district beat-drug activities on a regular basis to encourage participation of local residents.
    In the longer term, the DSWO in Kwun Tong will continue to take active part in the Kwun Tong District Fight Crime Committee to plan and co-ordinate anti-drug strategies at the district level. Group work units in the district, particularly the Group Work Unit of the Kwun Tong Community Centre (which is located in Tsui Ping Estate) will organize regular activities to educate young people to stay away from drugs. Services from the "Against Substance Abuse Scheme" provided by the team of specially trained social workers newly set up by the Social Welfare Department would also be tapped whenever necessary.
    A paper on "Illicit use of drugs in Kwun Tong District" was discussed at the Kwun Tong District Fight Crime Committee meeting in May*1995 to co-ordinate district efforts in tackling the problem. Local non-government organizations will be encouraged to organize anti-drug activities through various channels such as the Kwun Tong District Committee on Family Life Education, the Kwun Tong District Group and Community Work Service Co-ordinating Committee. Social workers of the Society for the Aid and Rehabilitation of Drug Abusers working in the methadone clinic in the district will continue to provide casework services to drug abusers to facilitate their social rehabilitation.

Air Services to Taiwan

14. MR LAW CHEUNG-KWOK asked (in Chinese): Will the Government inform this Council:

  1. whether, in order to be eligible to apply for a licence to operate air services between Hong Kong and Taiwan, the China National Aviation Corporation (CNAC) has made a formal application to become an airline whose principal operation is based in the territory; if so, what factors the Government will take into consideration in determining whether a licence will be granted to CNAC to operate the route; if not, whether it will consider inviting CNAC to make such an application; and
  2. what share of the market does the Cathay Pacific Airways (CPA) have in providing air services between Hong Kong and Taiwan, and whether CPA has adopted any policy which is not in the interest of the consumers?

SECRETARY FOR ECONOMIC SERVICES: Mr President,

  1. The China National Aviation Corporation (Hong Kong) Limited (CNAC(HK)) submitted an application for an Air Operator's Certificate (AOC) to the Civil Aviation Department (CAD) on 29 March 1995. Securing an AOC is a necessary prerequisite to operate Hong Kong registered aircraft for the purpose of public transport. An AOC may be granted if the Governor is satisfied that the applicant is competent, having regard in particular to his previous conduct and experience, his equipment, organization, staffing, maintenance and other arrangements to secure the safe operation of aircraft of the types specified in the certificate. CNAC(HK) has not yet submitted any documents in support of its application. CAD will give due consideration to the application when such documents are received.
    An application for an AOC is the first of several steps which a company has to go through before it will be able to mount scheduled air services with Hong Kong registered aircraft. In addition, the company will also have to apply for registration of its aircraft, obtain a licence for a specific route from the Air Transport Licensing Authority and seek designation by the Government for the route concerned. It is not government policy to invite any particular airline to make an application for any route; the airline concerned would have to apply and fulfill all the necessary requirements before it will be permitted to operate.
  2. At present, scheduled air services between Hong Kong and Taiwan are operated between Hong Kong and two cities in Taiwan, namely, Taipei and Kaohsiung. On the Hong Kong - Taipei route, the Cathay Pacific Airway's (CPA's) market share was 51.1% in the 12 months up to August 1995. On the Hong Kong - Kaohsiung route, CPA's market share was 53.8% in the same period.
    On both of the routes between Hong Kong and Taiwan, there is a choice for consumers. On the Hong Kong * Taipei route (which constitutes 82% of the total traffic between Hong Kong and Taiwan), six other airlines, apart from CPA, operate on the route. They are British Asia Airways, China Airlines, Japan Asia Airways, Singapore Airlines, Garuda Indonesia Airways, and Thai Airways International. On the Hong Kong * Kaohsiung route where traffic is only about 18% of the total traffic between Hong Kong and Taiwan, China Airlines operate on the route in addition to CPA.

Application and Approval of Search Warrants

15. MR CHIM PUI-CHUNG asked (in Chinese): In regard to applications for search warrants by government departments, will the Government inform this Council:

  1. of the criteria on which the court's approval of an application for search warrant file by a government department is based and whether there is any system to keep this power in check;
  2. whether the court or the department which files the application will be held responsible in the event that the application is subsequently proved to be at fault or ultra vires;
  3. of the time normally taken for obtaining a search warrant; and
  4. if members of the public have objections to be contents of an application for search warrant, to which department should they go to in order to raise their objection prior to the grant of the search warrant?

CHIEF SECRETARY: Mr President,

  1. In granting applications for search warrants, the court acts in accordance with the provisions in the relevant legislation under which the applications are made. The magistrate responsible will make sufficient enquiry to satisfy himself that there is reasonable cause to suspect that the items in respect of which the warrant is sought are on the premises to be searched. Such enquiry could include questioning the police officer requesting the search warrant under oath or affirmation or requiring the information in support of the warrant to be more precise.
    The power to grant warrants is discretionary. Therefore, a magistrate is not required to accede to an application for a search warrant even where the statutory requirements have been met. This together with the fact that a magistrate must refuse to grant a warrant if he is not satisfied that there is reasonable cause to suspect that the items in respect of which the warrant is sought are on the premises to be searched, serves to keep searches by government departments in check.
  2. Whether the court or the department which filed the application would be held responsible in the event that the application is subsequently proved to be at fault or ultra vires depends upon the circumstances in which the search warrant was issued. In general terms, a court could only be held responsible where it was established that it was acting maliciously and without reasonable and probable cause; and a government department could only be held responsible where it was established that it was acting maliciously.
  3. A department can normally obtain a search warrant from the court on the same day it files an application.
  4. An application for a search warrant is made ex parte, that is, only the party making the application is present. To inform the owner of the premises to be searched of the application would defeat the purpose of the search.

Air-tickets for Civil Servants on Duty Visits

16. MR CHEUNG MAN-KWONG asked (in Chinese): With regard to the purchase of air-tickets by the Government for civil servants on overseas duty visits and training, will the Government inform this Council:

  1. of its policy on purchasing such air-tickets;
  2. whether agreements have been made with any airlines for the purchase of air-tickets; if so, what are the details and why such agreements have been made;
  3. of the expenditure involved in purchasing such air-tickets during the past two years, together with a breakdown of the number of civil servants involved and their destinations;
  4. whether the Government has information to show that the adoption of its present policy on the purchase of such air-tickets, as compared with purchases made through travel agents or by other means, will result in a higher expenditure of public funds; if so, what are the reasons for continuing with the present policy; and
  5. whether consideration has been given to reviewing the present policy on the purchase of such air-tickets; if so, what are the details; if not, whether the Government will consider adopting other arrangements to purchase such air-tickets, such as placing orders with the airline purchase such air-tickets, such as placing orders with the airline charging the lowest fares or introducing other forms of competition?

SECRETARY FOR THE CIVIL SERVICE: Mr President, the answers to the questions raised are:

  1. The Government has an agreement with the British Airways (BA) and Cathay Pacific Airways (CPA) under which air-tickets (from any airlines) for civil servants on overseas duty visits have to be purchased through Jardine Airways (BA's general agent) or CPA. Air-tickets for civil servants on overseas training are not covered by the agreement, and can be purchased through any travel agent which accepts direct payment by the Treasury.
  2. The passage agreement with BA and CPA basically covers the Government's duty and school passages, but the Government may also make use of the contract fares for other passages to and from the United Kingdom. The main features of the agreement are:

    1. BA and CPA provide air-tickets at reduced fares on the Hong Kong - United Kingdom direct route (the United Kingdom route); and
    2. air-tickets on non-United Kingdom routes (from any airlines) have to be purchased through Jardine Airways or CAP.
      The Government entered into an agreement with the two airlines because the service required by the Government was and remains mainly passages on the Hong Kong - United Kingdom direct route ─ the bulk of which relate to school passages. Until 1994 only BA and CPA provided direct-route service to the United Kingdom. With the exception of Virgin Atlantic Airways (VAA) which started operating on the Hong Kong - United Kingdom direct route in 1994, the other airlines do not provide direct-flight service on the this route and therefore are unable to participate. We are discussing with BA and CPA the possibility of including the service of VAA in the current agreement.
    3. The expenditure involved in purchasing air-tickets for civil servants' overseas duty visits and training in 1993-94 and 1994-95 is $85.4 million, involving a total of 5 956 return passages. We have not kept specific records on the destinations of these passages.
    4. On the whole, we are getting a reasonable deal out of the agreement with BA and CPA as the Government is able to benefit from the reduced fares on the Hong Kong - United Kingdom direct flights with guaranteed bookings in both peak and off-peak seasons. The current arrangement for the purchase of air-tickets for civil servants' overseas duty visits and training, even if considered on its own, does not incur a much higher public expenditure, since the costs of published-fare air-tickets are roughly the same irrespective of from which agent they are bought. We are using published fares because the lower-fare air-tickets available in the market are very often special or promotional-fare tickets with usage restrictions attached, which would frequently not meet the operational requirements of these duty visits.
    5. With a view to achieving further savings, we are discussing with BA and CPA the possibility of including the service of VAA in the current agreement. We are also reviewing the scope of our being able to make use of the cheaper air fares available in the market for civil servants' overseas duty visits and training.

Green Island Public Dump Scheme

17. MR AMBROSE LAU asked (in Chinese): Now that the Government is consulting the public on the feasibility of the Green Island Public Dump Scheme and that the removal of Hong Kong International Airport has been scheduled for 1998, will the Government inform this Council whether consideration will be given to transporting construction waste on Hong Kong Island by land or by sea to the waters off the Airport and Kowloon Bay for dumping as an interim measure, as such a move will prepare that area for the future reclamation work on the one hand and allow more time for the public to study the policies relating to the Green Island reclamation on the other?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, the Territory Development Department has commissioned a feasibility study on the proposed future development of Kowloon Bay and the current Hong Kong International Airport. The study will examine, among other things, the possible sources of fill material, including construction waste, suitable for the proposed reclamation at Kowloon Bay. Findings of the study will help the Government in considering the viability of public dumping at Kowloon Bay and/ or the Airport. The study is scheduled to be completed in mid-1997. No decision will be made before the Government has examined the findings thoroughly.

Oxygen Content in Air

18. DR SAMUEL WONG asked: The proportion of oxygen in the air in some urban districts is sometimes found to be as low as 10%, although the normal oxygen content in the air is about 20%. In such circumstances, people will have to inhale more air, and hence more pollutants, than normal in order to get the oxygen required. In this connection, will the Government inform this Council whether:

  1. the Government will consider releasing the multiplication factor of pollution intake in each district due to lower oxygen content along with the pollution indices now published daily by the Environmental Protection Department; and
  2. if the answer to (a) above is in the negative, whether the Government will consider taking such factor into account in determining the pollution indices?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, the Air Pollution Index is designed to reflect the quality of outdoor air, of which the oxygen content is constantly at the normal level of 20%. In the outdoor environment, the carbon dioxide level in Hong Kong is well below 0.5% and variations around this level of concentration will not affect the oxygen content of the air. The issue of low oxygen in outdoor air is only relevant to locations at altitudes above 10 000 feet; but this is not relevant to Hong Kong. It is therefore not necessary for the Air Pollution Index to take into account the oxygen content. Hence, the answers to both (a) and (b) are in the negative.

Monitoring of H Share Companies

19. DR HUANG CHEN-YA asked (in Chinese): Will the Government inform this Council whether:

  1. the Securities and Futures Commission (SFC) will make a comparison between the profits predicted in the prospectuses of H share companies and the performance of these companies as published after the first year;
  2. the SFC has carried out investigations into companies which have recorded marked discrepancies between the predicted and actual profits; if so, what are the findings; and
  3. there are statutory provisions requiring merchant banks to be responsible for the accuracy of the information contained in prospectuses; if so, what are the liabilities of the merchant banks in the event that the particulars in the prospectuses are found to be incorrect, and what penalties will be imposed on them; if not, whether the Government will require merchant banks to assume responsibility, so as to reduce the chance of investors being misled?

SECRETARY FOR FINANCIAL SERVICES: Mr President,

(a) and (b)

    The Stock Exchange of Hong Kong (SEHK) is the frontline regulator responsible for the supervision of listed companies and the administration of all related matters. The SFC oversees the SEHK but is not directly involved in such matters.

    The SEHK reviews the performance of all newly listed companies, including H share companies, for the first accounting year after their listings, and compares that with the projected profits stated in the respective prospectus of the companies.

    All listed companies are required to sign a Listing Agreement and to abide by the SEHK Listing Rules. Under the Listing Agreement, a listed company is obliged to notify shareholders promptly of the occurrence of any event which could cause the forecast assumptions to be materially different from those stated in the prospectus and to indicate the likely impact of such event on the projected profits. The Listing Agreement also requires a company in such circumstances to include an explanation for such material difference in its directors' report and accounts.

    The SEHK monitors compliance with the Listing Rules and carries out inquiries where necessary. During the past three years, the SEHK has found two cases (one of which involves an H share company) where the actual results published in the directors* report and accounts differed materially from the projected profits stated in the relevant prospectus. In both cases, the company involved has issued a clarification statement to the public in accordance with the relevant Listing Rules.

  1. There are no statutory provisions which expressly impose special responsibilities on merchant banks for the accuracy of prospectuses. However, there are statutory provisions under which merchant banks could be exposed to criminal and civil liabilities in respect of untrue statements in prospectuses. Such liability is imposed on every person who has authorized the issue of the prospectus containing untrue statements. Coming within the wide class of persons who authorize the issue of the prospectus can be brokers, merchant banks, solicitors and others associated with the prospectus.
    Civil liability is created by section 40 of the Companies Ordinance (the Ordinance) in respect of Hong Kong companies, and section 342E of the Ordinance in respect of companies incorporated outside Hong Kong. The liability is to persons who subscribe for securities on the faith of a prospectus and sustain loss or damage by reason of any untrue statement contained therein.

    Criminal liability is created by section 40A of the Ordinance in respect of Hong Kong companies and section 342F of the Ordinance in respect of companies incorporated outside Hong Kong. If a prospectus contains a false statement, any person who authorized its issue will be guilty of an offence unless he can establish certain specific defences.

    The penalty for breaching section 40A or section 342F of the Ordinance is a fine of $500,000 or imprisonment for three years on indictment, and a fine of $100,000 and imprisonment of 12 months on summary charge.

    If a merchant bank acts as a sponsor in relation to a listing, it also has to comply with the Model Code for Sponsors of the Listing Rules. The Code requires that the sponsor should be closely involved in the preparation of the listing document and in ensuring that all material statements therein have been verified and that it complies with the Listing Rules and all relevant legislation. Failure by a sponsor to meet its obligations under the Listing Rules without reasonable excuse may render that person unacceptable to the SEHK for performing the role of a sponsor in the future.

ADDRESS

Ocean Park Corporation Annual Report 1994-95

MR RONALD ARCULLI

: Mr President, tabled before the Council today is the 1994-95 annual report of the Ocean Park Corporation.

In the financial year that ended on 30 June 1995, the Ocean Park enjoyed another year of record attendance with 3.3 million visitors to the Park, an increase of 5% on last year's record of 3.2 million.

The Ocean Park's revenue grew by 6% to HK$324 million. Operating income was HK$319 million. The net operating surplus for the financial year was HK$23 million, which compared with a net operating surplus of HK$53 million in the 1993-1994 financial year.

These results are most satisfactory given the difficulties encountered during the year. The higher attendance figure was pleasing given that Hong Kong experienced a series of severe tropical storms during the year which necessitated partial closure of the Park.

The number of overseas visitors to the Park fell by 9% mainly due to the drop in the number of tourists from China and Taiwan. Fortunately, more local residents visited the Park. The record number of visitors was largely due to improvements in the Ocean Park and new attractions which opened during the year.

Three new attractions costing a total of HK$58 million were opened in time for the Christmas-New Year holidays. On the Headland, we opened the 100-foot tall Ferris Wheel which provides spectacular views 400 feet above the South China Sea. We also opened the Eagle Ride which proved extremely popular. However, it is currently closed while modifications are made and tested. We plan to have the ride fully operational early next year. On the Lowland, we opened the Dinosaur Discovery Trail which, with its lifelike models and animatronic robots, proved an instant success with the public.

The largest influx of visitors came during the spring in response to the re-opening of the Atoll Reef. The Atoll Reef has traditionally been the Park's most popular attraction. The Reef has undergone a HK$65 million refurbishment and is now the largest reef aquarium in the world.

During its first full year of operation, the Ocean Park Conservation Foundation announced a five-year plan involving 16 whale and dolphin projects which include identification of conservation problems, development and executive of action plans, and long-term research to direct and support future marine mammal conservation efforts in the region.

The Foundation also convened the first meeting of the Asian River Dolphin Committee. Scientists from nine countries, including China, and representatives of the IUCN Cetaccan Specialist Group and The Whale and Dolphin Conservation Society met to discuss strategies for protecting threatened marine mammals.

The Ocean Park has an on-going commitment to improve access to the Park's facilities for Hong Kong's disabled residents. This year, new facilities for the disabled included contour models for mechanical rides, tactile maps and guide books for the visually impaired, improved access for wheelchair-bound visitors and the installation of a special gondola for disabled visitors on the new Ferris Wheel.

While the recent difficulties experienced at the Park fall outside this financial year, it would be remiss of me not to congratulate the management and staff on the way they handled the consequences of the tragic Aberdeen landslide.

Through their work, the comfort and safety of both visitors and of the Park's marine mammals, fish and animals were assured, and the Park was able to return to normal operations in a speedy manner. Above all, we owe special thanks also to the Government Flying Service, the Fire Services Department and the Electrical and Mechanical Services Department.

Looking to the future, our long-term development plan is to continue to expand and to better serve the needs of all age groups and interests within the community. In the next year, we expect to have further improvements and add new attractions including the opening of a Mine Train roller coaster and a high-tech simulator ride.

After a year that was both rewarding and eventful, the Ocean Park will continue to work to fulfill its mission to provide a balanced mix of recreation, education and conservation. I believe the Ocean Park is well set to achieve even higher levels of popularity and success.

Thank you, Mr President.

MOTIONS

EMPLOYEES' COMPENSATION ORDINANCE

THE SECRETARY FOR EDUCATION AND MANPOWER to move the following motion:

    "That, with effect from 1 January 1996, the Employees' Compensation Ordinance be amended as follows -
  1. in section 6 -
    1. in subsection (1)(a), (b) and (c), by repealing "$15,000" and substituting "$18,000";
    2. in subsection (2), by repealing "$219,000" and substituting "$262,000";
    3. in subsection (5), by repealing "$12,000" and substituting "$14,000";
  2. in section 7 -
    1. in subsection (1)(a), (b) and (c), by repealing "$15,000" and substituting "$18,000";
    2. in subsection (2), by repealing "$248,000" and substituting "$297,000";
  3. in section 8(1)(a) and (b), by repealing "$297,000" and substituting "$356,000";
  4. in section 11(5), by repealing "2,250" where it twice appears and substituting "2,450";
  5. in section 16A(10) -
    1. in paragraph (a), by repealing "$350" and substituting "$420";
    2. in paragraph (b), by repealing "$700" and substituting "$840";
  6. in section 17A(1) -
    1. in paragraph (a), by repealing "$350" and substituting "$420";
    2. in paragraph (b), by repealing "$700" and substituting "$840";
  7. in section 36C, by repealing "$24,000" and substituting "$28,000";
  8. in section 36J, by repealing "$74,000" and substituting "$86,000";
    1. in paragraphs 1(b), 2(b) and 3 of the Third Schedule, by repealing "$120" and substituting "$160"."

He said (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

The purpose of this resolution is to revise the levels of compensation and certain compensation-related items under the Employees' Compensation Ordinance. The Ordinance provides for payment of compensation by employers to employees who are injured or killed as a result of employment-related accidents. Our policy since 1978 has been to review the levels of compensation every two years to take account of wage movements, inflation and other changes. The existing levels of compensation have been in force since 1 January 1994 and are now due for revision. We propose that the revised rates should take effect as from 1 January 1996.

We propose to increase the ceiling for monthly earnings from $15,000 to $18,000. This figure is the basis on which the maximum amounts of compensation for permanent total incapacity and for death are calculated under the Ordinance. We also propose to increase the minimum levels of compensation for death from $219,000 to $262,000, and for permanent total incapacity from $248,000 to $297,000. In addition, we propose that the maximum amount of compensation for the costs of care required by another person be revised from $297,000 to $356,000. For late payment of compensation, we propose to increase the minimum amount of surcharge imposed upon expiry of the payment period from $350 to $420 and the minimum additional surcharge imposed three months after expiry of payment period from $700 to $840. Each of these six proposed revisions represents an increase of about 19.7% over the existing levels, which is in line with the increase in nominal wages during the past two years.

The ceilings on three other forms of compensation are to be adjusted to take account of inflation since their last revision in 1994. The proposed changes include increasing the maximum amount for burial expenses from $12,000 to $14,000, and increasing the maximum payments to be made by an employer towards the costs of supplying and fitting a prosthesis or a surgical appliance from $24,000 and $74,000 respectively to $28,000 and $86,000 respectively.

We also propose to raise the maximum daily rate of reimbursement of medical expenses from $120 to $160 to take account of the increase in fees charges by public hospitals and clinics since 1994.

Finally, we propose to revise the amount that is deemed to be the minimum earnings per month for the purpose of calculating compensation from $2,250 to $2,450. This proposed increase serves to keep the deemed minimum earnings of an injured employee broadly in line with the existing rate of payment to a singleton under the Comprehensive Social Security Assistance Scheme.

These proposals have been endorsed by the Labour Advisory Board and I recommend them to this Council for approval.

Mr President, I beg to move.

Question on the motion proposed.

MR LAU CHIN-SHEK (in Cantonese): Mr President, I certainly support today's motion which seeks to increase the rate of compensation for workers who were injured or even killed in the course of their work. However, I would also like to take this opportunity to state again what I think are the shortcomings of the present Employees' Compensation Ordinance, hoping that the Government will review the whole system of workers' compensation as soon as possible.

The legislation currently in force has stipulated various ceilings for calculating the rate of compensation for workers who have permanently lost the ability to work in the course of their work and has made it impossible for workers to obtain the compensation that they deserve. First, concerning the calculation of the monthly wage ceiling. Although today's motion seeks to increase the monthly wage ceiling from $15,000 to $18,000, that is still an unreasonable restriction, especially in the construction sector in which workers suffer serious injuries. For the many steel fixers, scaffold erectors and the majority of other professionals who may be earning a monthly wage exceeding $18,000, the present legislation has undoubtedly deprived them of the compensation that they deserve. Therefore the Government should consider abolishing the monthly wage ceiling. In fact, the present monthly wage ceiling for the calculation of severance pay and long service payment has already been increased to $22,500, but that for the calculation of workers' compensation is only to be increased to $18,000. This is obviously an unfair treatment to workers claiming workers' compensation.

Second, concerning the upper limit of the amount of compensation. According to the Employees' Compensation Ordinance, the maximum amount of compensation which workers can claim of the basis of injury or death sustained in the course of work is equivalent to seven years or eight years of their total income respectively. These ceilings, which have been set without and objective criteria, are particularly unfair to young workers seeking workers' compensation. For instance, a 17-year-old summer job worker was killed in an accident involving a hoist in North Point in June 1993. According to the law, he could only obtain compensation equivalent to eight years of his total wage and deductions had to be made according to the family's reliance on him. As a result, this worker's family could only obtain compensation amounting to $100,000 plus. Do you think that is fair? Human life is invaluable and the law which has imposed various restrictions on workers' compensation should absolutely be reviewed and improved. The Government may think that workers claiming workers' compensation can try to obtain more by suing their employers for negligence through civil proceedings. However, legal proceedings not only involve many problems of evidence, they are also very time-consuming; and a law suit will normally drag on for three to five years. That is undoubtedly unfair to the injured workers and their families. Therefore, I think a comprehensive review on the Employees' Compensation Ordinance should be conducted without delay so as to strengthen the protection given to workers claiming workers' compensation. Of course, what is more important is to improve industrial safety in Hong Kong so as to prevent the occurrence of accidents.

Mr President, with these remarks, I hope the Secretary for Education and Manpower can clearly respond to my demands in his concluding speech later on. Thank you.

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, I would like to thank the Honourable LAU Chin-shek for his speech as well as his support for this motion. I have listened very carefully to the views expressed by Mr LAU on some items. The Government will consider these views in detail in the next review. There is no doubt that we will fully consider the views of both the employers and employees with regard to this Ordinance in every review.

Thank you, Mr President.

Question on the motion put and agreed to.

PNEUMOCONIOSIS (COMPENSATION) ORDINANCE

THE SECRETARY FOR EDUCATION AND MANPOWER to move the following motion:

    "That, with effect from 1 January 1996, the Pneumoconiosis (Compensation) Ordinance be amended as follows -
  1. in the First Schedule -
    1. in paragraph 1 of Part II, by repealing "$2,100" and substituting "$2,570";
    2. in Part IV, by repealing "$3,500" and substituting "$4,050";
    3. in Part VI, by repealing "$12,000" and substituting "$14,000";
  2. in the Second Schedule, in paragraphs 1(b), 2(b) and 3 of Part I, by repealing "$120" and substituting $160".

He said (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

The purpose of this resolution is to revise the levels of compensation and certain compensation-related items under the Pneumoconiosis (Compensation) Ordinance. The Ordinance provides for payment of compensation for persons who were diagnosed after 1 January 1981 to be suffering from pneumoconiosis. We propose that the revised rates should take effect as from 1 January 1996.

We propose to raise the ceilings in respect of two items of compensation under the Ordinance to take account of inflation and wage movements since July 1993. First, we propose to increase the amount for calculating the monthly compensation for total incapacity, from $2,100 to $2,570. In this respect, it should be noted that under the Pneumoconiosis (Compensation) (Amendment) Bill which was introduced into this Council on 6 December 1995 (that is last Wednesday), the amount of $2,100 was proposed to be made a separate compensation item for pain, suffering and loss of amenities which would be paid to all eligible pneumoconiotics regardless of their degree of incapacity. Therefore, if this proposed revision is approved, we will move a Committee Stage Amendment to the Bill to revise the amount to $2,570. Secondly, we prepare to increase the amount of compensation for care and attention from $3,500 to $4,050.

Separately, we also propose to revise the rates of funeral expenses and medical expenses payable under the Ordinance which have always been identical to those specified in the Employees' Compensation Ordinance. As the rates of such expenses under the Employees' Compensation Ordinance have just been raised by a resolution of this Council, I propose that the levels of these two items be similarly revised.

The proposed have been endorsed by the Labour Advisory board and I recommend them to this Council for approval.

Mr President, I beg to move.

Question on the motion proposed, put and agreed to.

STAMP DUTY ORDINANCE

THE SECRETARY FOR THE TREASURY to move the following motion:

    "That section 29I(1) of the Stamp Duty Ordinance be amended by repealing "31 December 1995" and substituting "31 December 1997"."

He said (in Cantonese): Mr President, I move the resolution standing in my name on the Order Paper.

I would like to first outline the background. In January 1992, Members approved amendments to the Stamp Duty Ordinance (Cap. 117). Among other things, these amendments required stamp duty to be paid on all agreements for sale of residential property. By contrast, stamp duty was previously only payable on the assignment of the property.

This measure was one of a series of actions to curb speculation in residential property. It is a disincentive to those who speculate on property in the period between the conclusion of a sale agreement and the assignment. Apart from the additional stamp duty a speculator has to pay for each sale before assignment, the speculator also has a potential profits tax liability. The information on sale agreements provided to the Commissioner of Inland Revenue under the measure enables him to identify property transactions which may be liable to profits tax. This ensures that the speculators pay a fair share of profits tax. The cost of speculation has therefore been significantly increased. Genuine home-buyers are not affected by this measure except insofar as they have to pay stamp duty slightly earlier.

Under the terms of the original amendments, the measure would have expired at midnight on 31 December 1993. The intention was to allow both the administration and Members the opportunity to examine all relevant factors before deciding whether the measure should be extended. On 15 December 1993, Members approved a resolution to extended the measure for two years until 31 December 1995.

The residential property market has gradually softened. The problem of speculation has now been largely contained. This is the combined effect of measures proposed by the Inter-departmental Task Force on Land Supply and Property Prices, mortgage lending policy of banks, changes in interest rates, as well as the increased cost of speculation as a result of the stamp duty measure. It is therefore important that the stamp duty measure be extended. Otherwise, it would send a wrong signal to the market that the Government no longer wished to curb speculation in residential property. There would also be a significant risk that speculation may be rekindled to the detriment of genuine home-buyers.

The motion before Members today seeks the extension of the measure by a further period of two years beyond 31 December 1995. I am grateful that the Legislative Council Subcommittee formed to study the motion supports the extension of the measure in principle though I understand that there are different views in respect of the period of extension, that is whether the measure should be extended for one year or two years.

It is clear that the measure is effective in containing speculation. It does not affect genuine home-buyers. It has been in place for nearly four years and is well established and accepted by the public. I therefore do not see any reason why we should deviate from our previous practice of extending the measure for two years which may otherwise give a wrong signal to the market in respect of this Council's determination in containing speculation. In fact, we have also informed the Subcommittee that it is our plan to seek the views of Members later on in this session with a view to introducing an amendment to the Stamp Duty Ordinance to make the measure permanent. This will eliminate unnecessary speculation which may otherwise occur each time the expiry date of the measure approaches. The proposed two-year extension would allow Members sufficient time to study the permanent arrangement proposal. However, if the measure were to be extended for one year only and the amendment to the Stamp Duty Ordinance to make the measure permanent could not be processed in time, we might have to seek an extension again before the end of next year, thereby adding an unnecessary burden to the heavy agenda of this Council. I therefore strongly recommend to Members that the two-year extension should be supported.

Finally, I am also grateful to the Members of the Subcommittee for their views on how we should revise the stamp duty system in order to alleviate the financial burden of genuine home-buyers and to safeguard against abuse. I can assure Members that we will examine these views carefully before we submit the permanent arrangement proposal to this Council.

Mr President, I beg to move.

Question on the motion proposed.

PRESIDENT: Mr Ronald ARCULLI has given notice to move an amendment to the motion. His amendment has been printed on the Order Paper and circularized to Members. I propose to call on him to speak and to move his amendment now so that Members may debate the motion and the amendment together.

MR RONALD ARCULLI's amendment to the SECRETARY FOR THE TREASURY's motion:

    "To delete "31 December 1997" and to substitute "31 December 1996"."

MR RONALD ARCULLI:Mr President, I move that the Secretary for the Treasury's motion be amended as set out under my name in the Order Paper. A Subcommittee of 12 Members was formed on 20 October 1995 to study the resolution. I was elected Chairman of the Subcommittee. The Subcommittee held two meetings with the Administration, and I shall highlight two issues which were of concern to the Subcommittee.

The first concern was about the effectiveness of the stamp duty measure and its continued usefulness. While some Members of the Subcommittee agreed with the Administration that the measure could help stabilize the residential price, other Members were not as certain and pointed out that the price of other properties had also been stabilized even though they were not the subject of the same measure. Some Members also cast doubts on the continued usefulness of this measure in the light of the already softened property market and the need to stimulate the local economy.

The second concern was whether the ultimate objective of the measure was to raise revenue or to curb speculation on the residential property market. The Administration told the Subcommittee that the measure had been introduced with the principal aim of helping to curb speculation, although it had also achieved two other equitable results, which were the stamp duty payable on the sale and purchase agreement and that the Commissioner of Inland Revenue could more readily identify property transactions liable to profits tax.

The Administration acknowledged that at the time of introducing the measure, anti-speculation had been the prime factor, but in seeking its extension in the present exercise both factors were important and it was not possible to say which had a greater weight. On this particular point, my own view is that the Administration has in fact changed the stamp duty system, which has since the very beginning charged stamp duty on assignments of residential property. I cannot accept such change for the reasons of raising revenue.

The majority view of the Subcommittee was to support the Administration in seeking an extension of time on the stamp duty measure in principal, yet Members indicated they would have to make an assessment about the impact of the stamp duty measure on the local economic climate before they could decide whether the extension should be for one year, to cover until 31 December 1996, or two years until 31 December 1997.

On 6 December 1995, Mr President, I submitted an amendment to the Administration's resolution, the effect of which is to extend the operation of the relevant section to 31 December 1996 rather than 31 December 1997. I shall set out my reasons for moving such an amendment. Property speculation in the current economic climate is virtually non-existent. Indeed, it can be said that the stamp duty and other measures have achieved their objective some time ago. It must be clear to all of us that steps need to be taken to stimulate the economy and one such step would be the removal of the stamp duty measure. At the very least, the situation should be reviewed after a shorter interval than that proposed by the Administration.

It has often been said that the Hang Seng Index and the property market act as a barometer of our confidence in Hong Kong, and we know that both are substantially below their peaks. Therefore, it cannot be objectionable to extend the stamp duty measure for one year only. I doubt very much whether the Administration will find it necessary to extend its operation for another year, but if it is, the Administration will of course be at liberty to table another resolution at the appropriate time. For now, however, I urge Members to support my amendment so that the existing measure will only be extended until 31 December 1996.

In conclusion, Mr President, I urge Members to give serious consideration to the Administration's stated desire to continue receiving the extra revenue from this so-called anti-speculation measure. The Administration does not need this Council's help to raise surplus revenue. Ultimately, the cost of any extra stamp duty will find its way into the pockets of end-users who will pay for it.

When the Secretary for the Treasury, Mr President, mentioned the two-year extension, the thought just dawned on me as to how many of us will be here in two years' time, so I would urge Members to support my motion so that the control of this measure will remain with Members of this Council.

Mr President, with these remarks, I move that the Secretary for the Treasury's motion be amended as set out in the Order Paper.

Question on the amendment proposed.

MR LEE WING-TAT (in Cantonese): Mr President, the Democratic Party believes that collecting stamp duty on sale and purchase agreements of residential property is an effective measure to curb speculation. That is because suppose two or more sale and purchase agreements have been entered into before the actual assignment of a residential property, stamp duty will be payable for each and every agreement. This measure will increase the costs of speculators without affecting the real users.

At present, property prices have fallen by about 30% compared with those in April 1994 and October 1995, but they are still not affordable by the general public. According to information contained in the Government's written reply given to me last week, in 1985, an ordinary Hong Kong citizen could buy a flat of 500 sq ft in the urban area with only an amount equivalent to 120 times the median monthly wage. Now in 1995, however, the same worker will have to pay an amount equivalent to 190 times the median monthly wage to buy the same flat. Therefore, Mr President, although property prices have apparently fallen, it is only a slight fall from a very high peak and they are still not affordable by the general public, especially the grassroots. In October 1995, about 10% of all property assignments were still short-term assignments. This percentage is only slightly lower than that of what we call the peak which is 22%. Therefore, speculation has not completely disappeared, it has only dampened slightly. Short-term assignments amounting to 22% is certainly an indicator of a lot of speculation at the time, but 10% is still a significant figure.

If anti-speculation measures are immediately relaxed just when there is a fall in property prices, suppressed speculative activities will easily become active again and the ultimate victims will be the real users. Moreover, now that property prices have only fallen slightly, property developers are already feeling anxious and, with the help of our Financial Secretary, they have spread the news that property prices have hit the bottom and promoted the opinion that they will rise again very soon. Many associations of property developers have continuously lobbied the Government to relax the mortgage restrictions. Therefore, now that property prices have fallen, we have to take steps to stabilize the situation. If not, there will be an upsurge of property prices once the anti-speculation measures are relaxed.

If we extend measure to collect stamp duty on sale and purchase agreements of residential property for only a year, then a year later, before the falling trend of property prices has stabilized, speculators will have the chance to enter the market and there will be a revival of speculation. In addition, there will still be a shortage of private housing units in the next two years and less land will be available for urban redevelopment. Relaxing the anti-speculation measure in the face of reduced supply will only lead to an upsurge in property prices.

Therefore, Mr President, we do not agree with the Honourable Ronald ARCULLI's amendment and we will support the Government's motion. Thank you, Mr President.

MR CHAN KAM-LAM (in Cantonese): Mr President, up till now, the Stamp Duty Ordinance has really been effective in curbing property speculation and, therefore, the Democratic Alliance for the Betterment of Hong Kong supports the Secretary for the Treasury's motion to extend the measure to 31 December 1997. Besides, we would also urge the Government to review the present system of stamp duty as soon as possible so that, with the extra revenue obtained under the present system, tax concessions can be given to the real users in the community and the public can be encouraged to own their homes. Thank you, Mr President.

MR EDWARD HO (in Cantonese): Mr President, I remember that in the year in which the stamp duty measure was passed into law, I was Chairman of the Select Committee concerned. At that time, the Government made it clear that the measure was intended to curb property speculation. However, it seems that it has now become one of the Government's ways to grab revenue. Why do I say that?

The Honourable LEE Wing-tat talked about the question of property prices. The present level of property prices is certainly higher than that of 1985 and it is very much higher than that of 1967. There is no need for us to argue what is the level which we would consider it wrong to allow property prices to reach. However, we should be clear that it would not be possible to speculate on new flats at all. That is because with the implementation of the new measure, a flat cannot be sold earlier than nine months before the occupation permit is due to be issued and, after purchase, it cannot be assigned until the occupation permit has been obtained. Therefore, it would not be possible to speculate on new flats. Now, the subject for discussion is the speculation of old domestic units. Would it be possible to speculate on old domestic units? What does "speculation" mean? Speculation means trying to make a profit by means of assignment with very little money, that is, before all the money and costs have been paid. However, to purchase an old domestic unit, the price has to be paid in full, which means it would not be possible to speculate and we also know clearly that there are no speculative activities on property in the market. If we support the Government's motion to extend the measure for two years, we would be supporting the Government to grab revenue by using this method. It is not a question of curbing speculation. Thank you, Mr President.

MR JAMES TO (in Cantonese): Mr President, I would like to briefly respond to the Honourable Edward HO's viewpoints. In fact, I agree that it would not be possible to speculate on new flats. If there are restrictions forbidding any assignment of uncompleted flats before the occupation permit is issued, the question of how many times a new flat can be assigned between the time that a purchase agreement has been signed and the final stage when the assignment is entered into simply does not exit. Here the question is: Would it be possible to speculate on old domestic units.

When purchasing an old domestic unit, one does not necessarily have to pay the price in full because theoretically, the deposit can be set, for instance, at 10% or 20% of the price and then the agreement can be signed. If no stamp duty is payable at this stage, the purchaser and the vendor can decide on a transaction date in the more distant future. Experience shows that speculation does occur in this interim period and a unit can be assigned several times before occupation or before the assignment is entered into.

This measure will not affect the real users adversely. I believe we will agree that this is true if we really want to help the real users, no matter to which political party we belong; unless my honourable colleagues can provide any evidence that this measure will affect the real users adversely, then that will be a different matter. In fact, whether tax concessions and deductions of mortgage interests payable should be allowed and whether the amount and percentage of mortgage loan should be increased will be practical and useful measures for us to discuss now. I believe this measure will not be used to grab revenue, but even if it will, it will only be used to grab revenue from the property speculators and potential speculators, not from the users. Actually, even if this measure does not exist, stamp duty is payable anyway at the final stage when the assignment is entered into.

MRS SELINA CHOW (in Cantonese): Mr President, earlier on, I heard the Honourable James TO mention "theoretically" and, very often, we hear colleagues from the Democratic Party say "theoretically"; I think that is not the way we should consider problems.

In fact, it is not easy to differentiate clearly who are the buyers and who are the users. We have to consider clearly not only the effect of a measure on the buyers, the users or the speculators, but also the effect on the property market as a whole. Earlier on, we heard the Honourable LEE Wing-tat's speech and there is nothing much to it. Basically, he thinks that the property prices at present are not low enough; they should fall even lower and it would be best if they were reduced by half or even more. He only cares for those who want to buy their own flat, but neglects those who have already done so and have lost a fortune because they may have used up all their assets to pay for the deposit.

I believe we are not relaxing the measure. The question is: the Government said that this measure was introduced because there was a problem and that this was a temporary measure to cool off the over-heated property market. If it is temporary, then it should not be extended arbitrarily for two years, for two more years and yet two more years so that it would become a permanent measure to intervene in the market until the price reaches a level which is considered to be acceptable by some. This is not the way in which this measure should work. I am only hoping that we can understand that we are actually intervening in the market. Do we want to adopt this approach as a long-term policy? Alternatively, we can continue to give the market the message that this is actually a temporary measure: when there is a serious problem, certain measures have to be adopted; when the problem is less serious, we do not wish to intervene.

Thank you, Mr President.

MR ALBERT HO (in Cantonese): Mr President, I would like to make only a very short response. First, what is "property speculation"? To put it very simply, it means purchasing a property with a very small outlay and trying to assign it within a certain period of time after a wait-and-see period (there is already an intention of assignment at the time of purchase).

What is the method commonly used? Earlier on, the Honourable James TO has said that after the purchasers have paid the deposit, they would speculate on property by means of assignment. That was the case with the purchase of uncompleted flats in the past and that is still the method used in the speculation of old domestic units. That is not a theoretical situation. As a solicitor who has practised for more than 10 years, I have seen many people doing it. Now, with the introduction of the stamp duty measure, the assignee has to pay the stamp duty for every assignment. I think this is an effective measure to curb speculation and its effectiveness has also been generally acknowledged. Although this measure is still inadequate, the question, as the Honourable Mrs Selina CHOW suggested, is : What will be the result if this measure is cancelled?

Earlier on, Mrs CHOW has mentioned that many people have lost a lot of money as a result of the suppression of property prices and it is hoped that property prices will rise again. I hope that is not what Mrs CHOW meant. I really hope that that is not what she meant. However, we have to be very clear that this is only a temporary measure, though I do not think it will cause any unfairness. We have to emphasize time and again that at present, it is the assignee who has to pay the stamp duty. In fact, it is only fair that stamp duty is payable on every assignment of property rights. Therefore, when the Secretary for the Treasury said that a long-term review has to be carried out, I think that is a good thing. However, in the meantime, we have to spend time to review the situation and we must not give people a wrong message. We will certainly not agree should this be a measure to intervene in the market; but this is in fact a measure to increase the costs of property speculators and a way to obtain money and revenue for the Inland Revenue Department through what we think is a reasonable approach. I do not see any disadvantage and it has not created an unfair situation.

Mr President, I would like to emphasize one last point. Relying on the levy of stamp duty to curb property speculation and to stabilize property prices is not enough, good co-ordination and continued efforts by the Government are also necessary. We certainly do not agree to take any steps at this stage which would give other people a wrong message that the Government intends to relax the measure. Mr President, we support the Government's motion today in the hope that a review can be completed in two years' time so that we will know what steps should be taken in the long run. I therefore oppose the Honourable Ronald ARCULLI's amendment. Thank you.

MR ALLEN LEE (in Cantonese): Mr President, I would only like to point out that perhaps the Honourable Albert HO might have got it wrong; he used the word "cancel" just now but the Honourable Ronald ARCULLI has proposed to review, and not to cancel the measure, after a year. The use of the word "cancel" may mislead Members of this Council.

SECRETARY FOR THE TREASURY (in Cantonese): Mr President, although speculative activities in the property market have now slowed down, this does not mean that we can lower our guard. We must do our best to avoid sending any message which may make the market think that we would gradually relax or even cancel the measure related to stamp duty. In fact, with respect to property transactions which occur before or shortly after the signing of deeds of assignment, this is, cases of property re-sale, although the number has dropped from 16 023 cases in 1993 to 15 184 cases in 1994-95, 5 000 such cases were still recorded in the first six months of 1995-96. For that reason, we believe that there is a great need for the continued implementation of this particular measure. I do not accept the argument that cancelling the measure related to stamp duty can boost the economy. I believe that as far as property speculation is concerned, this will only reduce ......

PRESIDENT: Mr Allen LEE, do you have a point of order? Are you seeking elucidation?

MR ALLEN LEE: Yes.

PRESIDENT: Are you prepared to yield, Secretary for Treasury?

MR ALLEN LEE: The Secretary kept mentioning about cancelling. But Mr ARCULLI is not proposing cancelling. It is an extension to one year. So he has used the word three times already.

SECRETARY FOR THE TREASURY (in Cantonese): Mr President, perhaps the Member could not hear clearly what I just said. I said we should avoid giving any message that would make the market think there would be gradual relaxation or cancellation of this measure. I was only referring to the giving of a message. Allow me to continue with my speech.

I do not agree with the point that cancellation of the stamp duty measure can stimulate the economy. I think this will only cut the cost of the property speculators and indirectly encourage speculation activities on the property market. I have to emphasize that the measure on stamp duty is working well and it does not affect the genuine home buyers. The Honourable LEE Wing-tat has just explained the reason for this. In fact, if there are more speculation activities because of the cancellation of this measure, the cost of the genuine home buyers will be increased. Therefore, I hope Members will support the proposal to extend the stamp duty measure for two years.

Question on the amendment put.

Voice votes taken.

THE PRESIDENT said he thought the "Noes" had it.

Mr Ronald ARCULLI claimed a division.

PRESIDENT: Council shall proceed to a division.

PRESIDENT: I would like to remind Members that they are called upon to vote on the question that the amendment moved by Mr Ronald ARCULLI be made to the Secretary for the Treasury's motion.

PRESIDENT: Will Members please register their presence by pressing the top button in the voting units on their respective desks and then proceed to vote by selecting one of the three buttons below?

PRESIDENT: Before I declare the results, Members may wish to check their votes. Are there any queries? The result will now be displayed.

Mr Allen LEE, Mrs Selina CHOW, Mr NGAI Shiu-kit, Mr LAU Wong-fat, Mr Edward HO, Mr Ronald ARCULLI, Mrs Miriam LAU, Dr LEONG Che-hung, Mr CHIM Pui-chung, Mr Frederick FUNG, Mr Eric LI, Mr Howard YOUNG, Mr James TIEN, Mr Paul CHENG, Mr CHOY Kan-pui, Mr David CHU, Mr Ambrose LAU, Dr LAW Cheung-kwok, Mr Bruce LIU, Mr MOK Ying-fan and Miss Margaret NG voted for the amendment.

Mr Martin LEE, Mr SZETO Wah, Mr CHEUNG Man-kwong, Mr Michael HO, Dr HUANG Chen-ya, Miss Emily LAU, Mr LEE Wing-tat, Mr Fred LI, Mr James TO, Dr Samuel WONG, Dr Philip WONG, Dr YEUNG Sum, Mr WONG Wai-yin, Miss Christine LOH, Mr LEE Cheuk-yan, Mr CHAN Kam-lam, Miss CHAN Yuen-han, Mr Andrew CHENG, Mr CHENG Yiu-tong, Mr Anthony CHEUNG, Mr CHEUNG Hon-chung, Mr Albert HO, Mr IP Kwok-him, Mr LAU Chin-shek, Mr LAW Chi-kwong, Mr LEE Kai-ming, Mr LEUNG Yiu-chung, Mr NGAN Kam-chuen, Mr SIN Chung-kai, Mr TSANG Kin-shing, Dr John TSE, Mrs Elizabeth WONG and Mr YUM Sin-ling voted against the amendment.

THE PRESIDENT announced that there were 21 votes in favour of the amendment and 33 votes against it. He therefore declared that the amendment was negatived.

Question on the original motion put and agreed to.

MEMBER'S MOTIONS

INTERPRETATION AND GENERAL CLAUSES ORDINANCE

DR LEONG CHE-HUNG to move the following motion:

    "That in relation to the -
  1. Civil Aviation (Aircraft Noise) Ordinance (Amendment of Schedule) Notice 1995 published as Legal Notice No. 539 of 1995;
  2. Airport Authority Ordinance (71 of 1995) (Commencement) Notice 1995 published as Legal Notice No. 540 of 1995;
  3. Import (Radiation) (Prohibition) (Amendment) Regulation 1995 published as Legal Notice No. 541 of 1995;
  4. Import and Export (General) (Amendment) Regulation 1995 published as Legal Notice No. 542 of 1995;
  5. Import and Export (Fees) (Amendment) (No. 2) Regulation 1995 published as Legal Notice No. 543 of 1995;
  6. Import and Export (Registration) (Amendment) Regulation 1995 published as Legal Notice No. 544 of 1995;
  7. Ferry Services (Hongkong and Yaumati Ferry Company, Limited) (Determination of Fares) (Amendment) Ordinance 1995 published as Legal Notice No. 545 of 1995;
  8. Leveraged Foreign Exchange Trading (Calls) (Amendment) Rules 1995 published as Legal Notice No. 555 of 1995;
  9. Tax Reserve Certificates (Fourth Series) (Amendment) Rules 1995 published as Legal Notice No. 556 of 1995;
  10. Tax Reserve Certificates (Rate of Interest) Notice 1995 published as Legal Notice No. 557 of 1995;
  11. Prisoners' Education Trust Fund Ordinance (19 of 1995) (Commencement) Notice 1995 published as Legal Notice No. 558 of 1995;
  12. Official Languages (Amendment) Ordinance 1995 (51 of 1995) (Commencement) (No. 2) Notice 1995 published as Legal Notice No. 559 of 1995;
  13. Tax Reserve Certificates (Amendment) Ordinance 1995 (99 of 1995) (Commencement) Notice 1995 published as Legal Notice No. 560 of 1995;
  14. Official Languages (Authentic Chinese Text) (The Hongkong and Shanghai Banking Corporation Limited Ordinance) Order published as Legal Notice No. (C) 115 of 1995;
  15. Official Languages (Authentic Chinese Text) (Tramway Ordinance) Order published as Legal Notice No. (C) 116 of 1995; and
  16. Official Languages (Authentic Chinese Text) (Peak Tramway Ordinance) Order published as Legal Notice No. (C) 117 of 1995,

and laid on the table of the Legislative Council on 6 December 1995, the period referred to in section 34(2) of the Interpretation and General Clauses Ordinance for amending subsidiary legislation be extended under section 34(4) of that Ordinance until 10 January 1996."

DR LEONG CHE-HUNG: Mr President, I move the motion standing in my name on the Order Paper on behalf of the House. The motion seeks to extend the scrutiny period for the 16 items of subsidiary legislation tabled in the Council on 6 December 1995. As there is no sitting of the Legislative Council between 13 December 1995 to 10 January 1996, the deadline for Legislative Council intervention for these items of subsidiary legislation will fall on 3 January 1996 when there is no sitting.

In order to preserve Members' rights to amend any of these items, it is necessary to move an extension resolution to extend the period for intervention until 10 January 1996.

Mr President, I beg to move.

Question on the motion proposed, put and agreed to.

LEGISLATIVE COUNCIL (POWERS AND PRIVILEGES) ORDINANCE

MR LAU CHIN-SHEK

to move the following motion:

    "That for the purposes of enquiring into the circumstances surrounding the recent labour disputes involving imported workers under the Special Labour Importation Scheme for the Airport Core Programme Projects and related issues, the Legislative Council Panel on Manpower be authorized under section 9(2) of the Legislative Council (Powers and Privileges) Ordinance (Cap. 382) to exercise the powers conferred by section 9(1) of that Ordinance."

MR LAU CHIN-SHEK (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

Recently, labour disputes involving foreign workers of the airport projects have aroused much public concern, especially in relation to accusations of wage deductions and payment delays. In order to have an in-depth discussion of the matter, the Legislative Council Panel on Manpower held a special meeting on 5 December this year. Upon hearing the Administration's report on the labour disputes, the Panel was greatly shocked and disturbed about the unfair treatments received by the foreign workers. Although the Labour Department has stepped up its monitoring and enforcement efforts, the result is still disappointing. The Panel thinks that in order to assess the effectiveness of the new steps that have been taken or will be taken by the Government to protect the interests of foreign workers, it is necessary to understand the various arrangements for the importation of foreign labour, the role of the labour affairs companies and the extent of the contractors' responsibility. While the Government may conduct inquiries into individual cases on other aspects, the Panel thinks that it is necessary to conduct an in-depth inquiry in order to achieve the following aims:

  1. To understand the present procedures for the importation of labour and the circumstances under which wages are deducted and payments delayed;
  2. To assess whether the legislation enacted and the administrative measures adopted with a view to implementing and monitoring the Labour Importation Scheme are effective or not;
  3. To assess whether the new measures proposed by the Administration to control unlawful acts are effective or not;
  4. To put forth feasible means to strengthen the supervision, especially that of the Labour Importation Scheme; and
  5. To identify persons responsible for any unlawful acts.

In conducting this inquiry, the Panel on Manpower has to ask the parties concerned to provide evidence and relevant documents, but such parties may refuse to attend the inquiry or invoke the Legislation (Powers and Privileges) Ordinance for protection. In the circumstances, we have to ask this Council that the Panel be authorized under section 9(2) of the Legislative Council (Powers and Privileges) Ordinance to exercise the powers conferred by section 9(1) of the Ordinance. The Panel on Manpower, having submitted a report to the House Committee and obtained its support on 8 December, proposes the motion in this Council today. Now, I shall formally move the motion that the Legislative Council Panel on Manpower be authorized under section 9(2) of the Legislative Council (Powers and Privileges) Ordinance to exercise the powers conferred by section 9(1) of that Ordinance.

Mr President, with these remarks, I move the motion. Thank you.

Question on the motion proposed.

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, the recent outbreak of labour disputes on Airport Core Programme (ACP) work sites is a matter of serious concern to the Government. I should like to assure Members that a thorough investigation into each of the cases is being conducted. Hong Kong is a civilized society where the rule of law is paramount. We will not tolerate abuse of imported workers and will instigate prosecutions against those who may have breached the laws of Hong Kong. We fully appreciate Members' understandable concern about such cases and their desire to get to the truth to find out what went wrong and who is responsible. We share these sentiments entirely. However, it is not necessary nor appropriate for the Council to confer on the Manpower Panel the power under section 9 of the Legislative Council (Powers and Privileges) Ordinance to conduct an enquiry into the circumstances surrounding the labour disputes for the following reasons.

First, these labour disputes are already under investigation by the law enforcement agencies. The Labour Department has been making good progress in its investigations. In some of these cases, the investigations are at an advanced stage. Prosecutions relating to breaches under the Employment Ordinance are being considered in most of the disputes and hearings for the contractors and subcontractors involved have been arranged for this purpose. These hearings are an integral part of the due process which must be observed before taking a final decision on whether or not to lay charges. These investigation procedures are likely to be affected if the Manpower Panel of this Council is to conduct a parallel inquiry into the disputes. The use of the Legislative Council (Powers and Privileges) Ordinance whether to summon persons involved in the dispute or to ask for documents relating to the disputes will run the serious risk of delaying or jeopardizing our inquiries. I am sure Members would not wish to see this happen.

The Immigration Department is investigating into the various dispute cases to see if there are any offences under the Immigration Ordinance. The police are also at present investigating six constructions sites in connection with the recent labour disputes to ascertain whether any person has breached the law. Before these investigations are completed, any action taken by the Legislative Council to invoke the powers under the Legislative Council (Powers and Privileges) Ordinance to enquire into the circumstances of the cases may prejudice the outcome of such investigations. Any discrepancies in the statements and testimony of the same witnesses called by the police, the Immigration Department and the Panel, and the premature release of documents or evidence in connection with the cases possessed by the law enforcement agencies may impede the progress of our investigations and may adversely affect the chance of subsequent prosecutions.

Secondly, we have been in contact with the New China News Agency and are working with the relevant Chinese authorities with a view to improving communication and co-operation particularly in respect of the operation of and the legal charges imposed by the Chinese labour service companies to ensure that imported workers from PRC are aware of their rights and benefits, and to safeguard them from being exploited. I understand that the Chinese authorities have already set up a special team to investigate at their end the complaints about wage deductions. There is therefore no urgent need for this Council or the Manpower Panel to carry out an enquiry at this stage. Indeed, Members should await the outcome of the efforts by both Governments before deciding whether any further action is warranted.

As an open and accountable Government, we fully acknowledge that the public has the right to know more about the causes of and the results of our investigations into the current labour disputes. We have no intention of hiding the truth from members of the public. I intend to present to this Council in about three months' time a detailed report on the results of all our investigation efforts. This report will not only set out the outcome of investigations in Hong Kong, but will also include information about the role of the labour service companies and the result of our liaison efforts with the Chinese authorities. This will enable both Members and the general public to have a full picture of the problems involved, their causes, the effect of the various remedial measures we have recently taken and any further recommendations we may put forward to enhance the integrity of the system. Members will be given ample opportunity to discuss and raise questions on this report.

I personally led the team of officials and senior representatives of the Airport Authority (AA) and MTRC to answer questions on the ACP labour disputes at the Special Manpower Panel Meeting on 5 December 1995. My colleagues and I, including the authorities concerned, AA and MTRC, are very much prepared to continue to co-operate fully with the Manpower Panel without prejudice to our investigations. The exercise of the Legislative Council powers and privileges, if targeted at the Administration and the other institutions mentioned above, is absolutely unnecessary.

We have already provided information to the Manpower Panel on the nature of the recent labour disputes. I do not wish to repeat here. However I would like to reiterate that we have already added new conditions to strengthen our monitoring system to minimize the possibility of abuse of the scheme. With effect from 1 November 1995, employers are required to: (1) give a copy of employment contract to his imported workers; (2) provide them with details of their monthly earnings; (3) provide them with a monthly statement showing all transactions of their bank accounts. Within eight weeks upon the arrival of an imported worker in Hong Kong, the employer is required to grant him paid leave to enable him to attend briefings on his statutory rights as an employee under Hong Kong labour laws and his contractual rights under the employment contract. On top of these measures which are already in force, we intend to require employers to give an undertaking to the Labour Department that the imported workers have received a copy of the employment contract specifying the post and amount of wages before they come to Hong Kong. Officers of the Immigration Department will ask the imported worker to present his employment contract for inspection purpose shortly upon their arrival in Hong Kong.

I would like to assure this Council once again that we do not and will not tolerate any abuse of imported workers. We are committed to upholding the integrity of the ACP Labour Importation Scheme. Malpractices by a few threaten the good name of other law-abiding employers and the good name of Hong Kong. We are fully committed to do everything within our power to combat abuses and malpractices. Labour Inspectors of the Labour Department conduct regular inspections to the places of work of imported workers to check whether provisions under the Employment Ordinance and the Employees' Compensation Ordinance have been complied with and to guard against other abuses which constitute breaches of the conditions under the Scheme.

I would also like to make clear, once again, that without prejudice to any prosecutions under the laws of Hong Kong, employers who are found to have contravened conditions of the scheme will be liable to: (1) withdrawal of quotas in hand; (2) refusal of application for extension of stay of the employee upon expiry of visa; and (3) refusal of application to import labour under the ACP scheme in future.

To conclude, I would assure Members again that we have been proceeding with our investigations into the labour disputes and related problems as a priority task. We are making every effort to improve the effectiveness of the various controls and safeguards under the ACP Scheme. The whole process of our work is open and transparent. We will work closely with concerned Members of this Council, the Manpower Panel and other interested parties during this process. We are open and receptive to any suggestions and advice on how we can improve the operational and monitoring system of the Scheme.

We do not see a need at this stage for this Council to empower the Manpower Panel under section 9 of the Legislative Council (Powers and Privileges) Ordinance to conduct hearings and enquiries into these labour disputes. We are very concerned that this will run the risk of prejudicing the Government's investigation efforts and thus will not be in the interest of the workers or the community as a whole. I would therefore ask Members to consider this motion in the light of my comments and vote against it. In the event this motion is passed, I will urge Members of the Council and the Manpower Panel to await and examine the Administration's detailed investigation report which we will, I repeat, submit in about three months' time before considering whether or not to invoke the Legislative Council (Powers and Privileges) Ordinance to conduct hearings and enquiries.

Thank you.

SECRETARY FOR TRADE AND INDUSTRY: Mr President,

  1. We do not have statistics on the number of accidents involving industrial and household glassware products and installations. Industrial accident statistics are analyzed by cause and by industry. There is no breakdown by either the material or the equipment involved in industrial accidents. The Hospital Authority compiles patient statistics according to international classification of diseases. It does not have separate figures on the number of accidents involving use or installation of glassware products.
  2. The safety of glassware products for private use or consumption is already covered by the Consumer Goods Safety Ordinance, which came into force in October this year. This Ordinance imposes a statutory duty on manufacturers, importers and suppliers of consumer goods (including glassware products) to ensure that the goods they supply in Hong Kong are safe. Section 4 of the Ordinance further requires that consumer goods (including glassware products) supplied in Hong Kong must comply with a general safety requirement which includes, inter alia, the adoption of reasonable safety standards published by a standards institute. Any supplier who fails to comply with the requirement under the Ordinance commits an offence. The Commissioner of Customs and Excise will monitor the situation and take enforcement action as appropriate.
    Accordingly, we do not see the need to introduce specific regulations to stipulate the safety standards for household glassware products and to require manufacturers to specify on their products the types of glass used and the level of durability measured in an impact test.

Relocation of Methadone Clinic to Tsui Ping Estate

13. MR FRED LI asked (in Chinese): The 10-year redevelopment programme for Kwun Tong Town Centre proposed by the Land Development Corporation includes the relocation of the methadone clinic at the Town Centre to Tsui Ping Estate nearby. As methadone clinics often bring nuisance to the community in which they are located, will the Government inform this Council:

  1. whether it will consult local community groups and residents in this regard; if so, what are the details; if not, why not;
  2. whether the Government will make alternative arrangements to set up the methadone clinic further away from Tsui Ping Estate in view of the worsening drug abuse problem in that Estate; and
  3. what long-term and interim measures the Government has adopted to tackle the drug abuse problem in the neighbourhood of Tsui Ping Estate?

SECRETARY FOR SECURITY: Mr President,

  1. The Kwun Tong Town Centre Redevelopment Scheme proposed by the Land Development Corporation (LDC) is still being considered by the Corporation and the Administration. If the Scheme is to be implemented, the Kwun Tong District Board, and other relevant local bodies, where appropriate, will be consulted in advance on any proposal to relocate the methadone clinic.
  2. No decision has been made on whether and where the methadone clinic in Kwun Tong should be relocated. The Government is open-minded about the location of methadone clinics. An important consideration is the accessibility of the clinic, as the objective of the methadone programme is to offer a readily accessible out-patient service for those drug abusers who seek treatment but, for various reasons, would not be able to take part in residential treatment programmes.
  3. The drug abuse problem in the neighbourhood of Tsui Ping Estate is being tackled at source by stepped-up law enforcement action, and preventive education and publicity.
    Police enforcement action against drug activities in Tsui Ping Estate has been stepped up. This can be seen from the number of arrests for serious narcotics offences in Tsui Ping Estate, which has increased from 46 in 1994 to 80 in the first nine months of 1995. At the street level, enhanced enforcement actions are taken on a daily basis against drug sellers and users. Information and intelligence on drug activities, with particular emphasis against drug sellers, are collected, collated and acted upon by the Kwun Tong District Special Duties Squad to target known drug sellers.
    The police also contributes to anti-drug education by organizing school visits and seminars with school headmasters and discipline masters, focussing on the prevention of drug abuse by students.
    Extra efforts have been put in preventive educational and publicity measures to arouse awareness among Kwun Tong residents on the drug problem. Emphasis has been laid on enhancing parents' understanding on the prevention and early detection of their children's involvement in drugs. In 1995-96, a total of seven programmes involving 10 000 participants have been/will be implemented by the social welfare service units in the district. Existing counselling services of family service centres and probation offices in the district have also been strengthened to help young people with drug problems and their families.
    The District Social Welfare Office (DSWO) in Kwun Tong has formed a Working Group on "District-wide publicity campaign in combating illicit use of drugs among young people in Kwun Tong District" in April*1995, to promote co-ordination and co-operation among government departments and local organizations to tackle the drug problem. A "Drug Ambassador Scheme" is now being launched by the Working Group, with the aim of publicizing widely anti-drug messages among young people through a signature campaign. So far over 7 000 participants from more than 30 local organizations have been enrolled. The Working Group also compiles leaflets on district beat-drug activities on a regular basis to encourage participation of local residents.
    In the longer term, the DSWO in Kwun Tong will continue to take active part in the Kwun Tong District Fight Crime Committee to plan and co-ordinate anti-drug strategies at the district level. Group work units in the district, particularly the Group Work Unit of the Kwun Tong Community Centre (which is located in Tsui Ping Estate) will organize regular activities to educate young people to stay away from drugs. Services from the "Against Substance Abuse Scheme" provided by the team of specially trained social workers newly set up by the Social Welfare Department would also be tapped whenever necessary.
    A paper on "Illicit use of drugs in Kwun Tong District" was discussed at the Kwun Tong District Fight Crime Committee meeting in May*1995 to co-ordinate district efforts in tackling the problem. Local non-government organizations will be encouraged to organize anti-drug activities through various channels such as the Kwun Tong District Committee on Family Life Education, the Kwun Tong District Group and Community Work Service Co-ordinating Committee. Social workers of the Society for the Aid and Rehabilitation of Drug Abusers working in the methadone clinic in the district will continue to provide casework services to drug abusers to facilitate their social rehabilitation.

Air Services to Taiwan

14. MR LAW CHEUNG-KWOK asked (in Chinese): Will the Government inform this Council:

  1. whether, in order to be eligible to apply for a licence to operate air services between Hong Kong and Taiwan, the China National Aviation Corporation (CNAC) has made a formal application to become an airline whose principal operation is based in the territory; if so, what factors the Government will take into consideration in determining whether a licence will be granted to CNAC to operate the route; if not, whether it will consider inviting CNAC to make such an application; and
  2. what share of the market does the Cathay Pacific Airways (CPA) have in providing air services between Hong Kong and Taiwan, and whether CPA has adopted any policy which is not in the interest of the consumers?

SECRETARY FOR ECONOMIC SERVICES: Mr President,

  1. The China National Aviation Corporation (Hong Kong) Limited (CNAC(HK)) submitted an application for an Air Operator's Certificate (AOC) to the Civil Aviation Department (CAD) on 29 March 1995. Securing an AOC is a necessary prerequisite to operate Hong Kong registered aircraft for the purpose of public transport. An AOC may be granted if the Governor is satisfied that the applicant is competent, having regard in particular to his previous conduct and experience, his equipment, organization, staffing, maintenance and other arrangements to secure the safe operation of aircraft of the types specified in the certificate. CNAC(HK) has not yet submitted any documents in support of its application. CAD will give due consideration to the application when such documents are received.
    An application for an AOC is the first of several steps which a company has to go through before it will be able to mount scheduled air services with Hong Kong registered aircraft. In addition, the company will also have to apply for registration of its aircraft, obtain a licence for a specific route from the Air Transport Licensing Authority and seek designation by the Government for the route concerned. It is not government policy to invite any particular airline to make an application for any route; the airline concerned would have to apply and fulfill all the necessary requirements before it will be permitted to operate.
  2. At present, scheduled air services between Hong Kong and Taiwan are operated between Hong Kong and two cities in Taiwan, namely, Taipei and Kaohsiung. On the Hong Kong - Taipei route, the Cathay Pacific Airway's (CPA's) market share was 51.1% in the 12 months up to August 1995. On the Hong Kong - Kaohsiung route, CPA's market share was 53.8% in the same period.
    On both of the routes between Hong Kong and Taiwan, there is a choice for consumers. On the Hong Kong * Taipei route (which constitutes 82% of the total traffic between Hong Kong and Taiwan), six other airlines, apart from CPA, operate on the route. They are British Asia Airways, China Airlines, Japan Asia Airways, Singapore Airlines, Garuda Indonesia Airways, and Thai Airways International. On the Hong Kong * Kaohsiung route where traffic is only about 18% of the total traffic between Hong Kong and Taiwan, China Airlines operate on the route in addition to CPA.

Application and Approval of Search Warrants

15. MR CHIM PUI-CHUNG asked (in Chinese): In regard to applications for search warrants by government departments, will the Government inform this Council:

  1. of the criteria on which the court's approval of an application for search warrant file by a government department is based and whether there is any system to keep this power in check;
  2. whether the court or the department which files the application will be held responsible in the event that the application is subsequently proved to be at fault or ultra vires;
  3. of the time normally taken for obtaining a search warrant; and
  4. if members of the public have objections to be contents of an application for search warrant, to which department should they go to in order to raise their objection prior to the grant of the search warrant?

CHIEF SECRETARY: Mr President,

  1. In granting applications for search warrants, the court acts in accordance with the provisions in the relevant legislation under which the applications are made. The magistrate responsible will make sufficient enquiry to satisfy himself that there is reasonable cause to suspect that the items in respect of which the warrant is sought are on the premises to be searched. Such enquiry could include questioning the police officer requesting the search warrant under oath or affirmation or requiring the information in support of the warrant to be more precise.
    The power to grant warrants is discretionary. Therefore, a magistrate is not required to accede to an application for a search warrant even where the statutory requirements have been met. This together with the fact that a magistrate must refuse to grant a warrant if he is not satisfied that there is reasonable cause to suspect that the items in respect of which the warrant is sought are on the premises to be searched, serves to keep searches by government departments in check.
  2. Whether the court or the department which filed the application would be held responsible in the event that the application is subsequently proved to be at fault or ultra vires depends upon the circumstances in which the search warrant was issued. In general terms, a court could only be held responsible where it was established that it was acting maliciously and without reasonable and probable cause; and a government department could only be held responsible where it was established that it was acting maliciously.
  3. A department can normally obtain a search warrant from the court on the same day it files an application.
  4. An application for a search warrant is made ex parte, that is, only the party making the application is present. To inform the owner of the premises to be searched of the application would defeat the purpose of the search.

Air-tickets for Civil Servants on Duty Visits

16. MR CHEUNG MAN-KWONG asked (in Chinese): With regard to the purchase of air-tickets by the Government for civil servants on overseas duty visits and training, will the Government inform this Council:

  1. of its policy on purchasing such air-tickets;
  2. whether agreements have been made with any airlines for the purchase of air-tickets; if so, what are the details and why such agreements have been made;
  3. of the expenditure involved in purchasing such air-tickets during the past two years, together with a breakdown of the number of civil servants involved and their destinations;
  4. whether the Government has information to show that the adoption of its present policy on the purchase of such air-tickets, as compared with purchases made through travel agents or by other means, will result in a higher expenditure of public funds; if so, what are the reasons for continuing with the present policy; and
  5. whether consideration has been given to reviewing the present policy on the purchase of such air-tickets; if so, what are the details; if not, whether the Government will consider adopting other arrangements to purchase such air-tickets, such as placing orders with the airline purchase such air-tickets, such as placing orders with the airline charging the lowest fares or introducing other forms of competition?

SECRETARY FOR THE CIVIL SERVICE: Mr President, the answers to the questions raised are:

  1. The Government has an agreement with the British Airways (BA) and Cathay Pacific Airways (CPA) under which air-tickets (from any airlines) for civil servants on overseas duty visits have to be purchased through Jardine Airways (BA's general agent) or CPA. Air-tickets for civil servants on overseas training are not covered by the agreement, and can be purchased through any travel agent which accepts direct payment by the Treasury.
  2. The passage agreement with BA and CPA basically covers the Government's duty and school passages, but the Government may also make use of the contract fares for other passages to and from the United Kingdom. The main features of the agreement are:

    1. BA and CPA provide air-tickets at reduced fares on the Hong Kong - United Kingdom direct route (the United Kingdom route); and
    2. air-tickets on non-United Kingdom routes (from any airlines) have to be purchased through Jardine Airways or CAP.
      The Government entered into an agreement with the two airlines because the service required by the Government was and remains mainly passages on the Hong Kong - United Kingdom direct route ─ the bulk of which relate to school passages. Until 1994 only BA and CPA provided direct-route service to the United Kingdom. With the exception of Virgin Atlantic Airways (VAA) which started operating on the Hong Kong - United Kingdom direct route in 1994, the other airlines do not provide direct-flight service on the this route and therefore are unable to participate. We are discussing with BA and CPA the possibility of including the service of VAA in the current agreement.
    3. The expenditure involved in purchasing air-tickets for civil servants' overseas duty visits and training in 1993-94 and 1994-95 is $85.4 million, involving a total of 5 956 return passages. We have not kept specific records on the destinations of these passages.
    4. On the whole, we are getting a reasonable deal out of the agreement with BA and CPA as the Government is able to benefit from the reduced fares on the Hong Kong - United Kingdom direct flights with guaranteed bookings in both peak and off-peak seasons. The current arrangement for the purchase of air-tickets for civil servants' overseas duty visits and training, even if considered on its own, does not incur a much higher public expenditure, since the costs of published-fare air-tickets are roughly the same irrespective of from which agent they are bought. We are using published fares because the lower-fare air-tickets available in the market are very often special or promotional-fare tickets with usage restrictions attached, which would frequently not meet the operational requirements of these duty visits.
    5. With a view to achieving further savings, we are discussing with BA and CPA the possibility of including the service of VAA in the current agreement. We are also reviewing the scope of our being able to make use of the cheaper air fares available in the market for civil servants' overseas duty visits and training.

Green Island Public Dump Scheme

17. MR AMBROSE LAU asked (in Chinese): Now that the Government is consulting the public on the feasibility of the Green Island Public Dump Scheme and that the removal of Hong Kong International Airport has been scheduled for 1998, will the Government inform this Council whether consideration will be given to transporting construction waste on Hong Kong Island by land or by sea to the waters off the Airport and Kowloon Bay for dumping as an interim measure, as such a move will prepare that area for the future reclamation work on the one hand and allow more time for the public to study the policies relating to the Green Island reclamation on the other?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, the Territory Development Department has commissioned a feasibility study on the proposed future development of Kowloon Bay and the current Hong Kong International Airport. The study will examine, among other things, the possible sources of fill material, including construction waste, suitable for the proposed reclamation at Kowloon Bay. Findings of the study will help the Government in considering the viability of public dumping at Kowloon Bay and/ or the Airport. The study is scheduled to be completed in mid-1997. No decision will be made before the Government has examined the findings thoroughly.

Oxygen Content in Air

18. DR SAMUEL WONG asked: The proportion of oxygen in the air in some urban districts is sometimes found to be as low as 10%, although the normal oxygen content in the air is about 20%. In such circumstances, people will have to inhale more air, and hence more pollutants, than normal in order to get the oxygen required. In this connection, will the Government inform this Council whether:

  1. the Government will consider releasing the multiplication factor of pollution intake in each district due to lower oxygen content along with the pollution indices now published daily by the Environmental Protection Department; and
  2. if the answer to (a) above is in the negative, whether the Government will consider taking such factor into account in determining the pollution indices?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, the Air Pollution Index is designed to reflect the quality of outdoor air, of which the oxygen content is constantly at the normal level of 20%. In the outdoor environment, the carbon dioxide level in Hong Kong is well below 0.5% and variations around this level of concentration will not affect the oxygen content of the air. The issue of low oxygen in outdoor air is only relevant to locations at altitudes above 10 000 feet; but this is not relevant to Hong Kong. It is therefore not necessary for the Air Pollution Index to take into account the oxygen content. Hence, the answers to both (a) and (b) are in the negative.

Monitoring of H Share Companies

19. DR HUANG CHEN-YA asked (in Chinese): Will the Government inform this Council whether:

  1. the Securities and Futures Commission (SFC) will make a comparison between the profits predicted in the prospectuses of H share companies and the performance of these companies as published after the first year;
  2. the SFC has carried out investigations into companies which have recorded marked discrepancies between the predicted and actual profits; if so, what are the findings; and
  3. there are statutory provisions requiring merchant banks to be responsible for the accuracy of the information contained in prospectuses; if so, what are the liabilities of the merchant banks in the event that the particulars in the prospectuses are found to be incorrect, and what penalties will be imposed on them; if not, whether the Government will require merchant banks to assume responsibility, so as to reduce the chance of investors being misled?

SECRETARY FOR FINANCIAL SERVICES: Mr President,

(a) and (b)

    The Stock Exchange of Hong Kong (SEHK) is the frontline regulator responsible for the supervision of listed companies and the administration of all related matters. The SFC oversees the SEHK but is not directly involved in such matters.

    The SEHK reviews the performance of all newly listed companies, including H share companies, for the first accounting year after their listings, and compares that with the projected profits stated in the respective prospectus of the companies.

    All listed companies are required to sign a Listing Agreement and to abide by the SEHK Listing Rules. Under the Listing Agreement, a listed company is obliged to notify shareholders promptly of the occurrence of any event which could cause the forecast assumptions to be materially different from those stated in the prospectus and to indicate the likely impact of such event on the projected profits. The Listing Agreement also requires a company in such circumstances to include an explanation for such material difference in its directors' report and accounts.

    The SEHK monitors compliance with the Listing Rules and carries out inquiries where necessary. During the past three years, the SEHK has found two cases (one of which involves an H share company) where the actual results published in the directors* report and accounts differed materially from the projected profits stated in the relevant prospectus. In both cases, the company involved has issued a clarification statement to the public in accordance with the relevant Listing Rules.

  1. There are no statutory provisions which expressly impose special responsibilities on merchant banks for the accuracy of prospectuses. However, there are statutory provisions under which merchant banks could be exposed to criminal and civil liabilities in respect of untrue statements in prospectuses. Such liability is imposed on every person who has authorized the issue of the prospectus containing untrue statements. Coming within the wide class of persons who authorize the issue of the prospectus can be brokers, merchant banks, solicitors and others associated with the prospectus.
    Civil liability is created by section 40 of the Companies Ordinance (the Ordinance) in respect of Hong Kong companies, and section 342E of the Ordinance in respect of companies incorporated outside Hong Kong. The liability is to persons who subscribe for securities on the faith of a prospectus and sustain loss or damage by reason of any untrue statement contained therein.

    Criminal liability is created by section 40A of the Ordinance in respect of Hong Kong companies and section 342F of the Ordinance in respect of companies incorporated outside Hong Kong. If a prospectus contains a false statement, any person who authorized its issue will be guilty of an offence unless he can establish certain specific defences.

    The penalty for breaching section 40A or section 342F of the Ordinance is a fine of $500,000 or imprisonment for three years on indictment, and a fine of $100,000 and imprisonment of 12 months on summary charge.

    If a merchant bank acts as a sponsor in relation to a listing, it also has to comply with the Model Code for Sponsors of the Listing Rules. The Code requires that the sponsor should be closely involved in the preparation of the listing document and in ensuring that all material statements therein have been verified and that it complies with the Listing Rules and all relevant legislation. Failure by a sponsor to meet its obligations under the Listing Rules without reasonable excuse may render that person unacceptable to the SEHK for performing the role of a sponsor in the future.

ADDRESS

Ocean Park Corporation Annual Report 1994-95

MR RONALD ARCULLI

: Mr President, tabled before the Council today is the 1994-95 annual report of the Ocean Park Corporation.

In the financial year that ended on 30 June 1995, the Ocean Park enjoyed another year of record attendance with 3.3 million visitors to the Park, an increase of 5% on last year's record of 3.2 million.

The Ocean Park's revenue grew by 6% to HK$324 million. Operating income was HK$319 million. The net operating surplus for the financial year was HK$23 million, which compared with a net operating surplus of HK$53 million in the 1993-1994 financial year.

These results are most satisfactory given the difficulties encountered during the year. The higher attendance figure was pleasing given that Hong Kong experienced a series of severe tropical storms during the year which necessitated partial closure of the Park.

The number of overseas visitors to the Park fell by 9% mainly due to the drop in the number of tourists from China and Taiwan. Fortunately, more local residents visited the Park. The record number of visitors was largely due to improvements in the Ocean Park and new attractions which opened during the year.

Three new attractions costing a total of HK$58 million were opened in time for the Christmas-New Year holidays. On the Headland, we opened the 100-foot tall Ferris Wheel which provides spectacular views 400 feet above the South China Sea. We also opened the Eagle Ride which proved extremely popular. However, it is currently closed while modifications are made and tested. We plan to have the ride fully operational early next year. On the Lowland, we opened the Dinosaur Discovery Trail which, with its lifelike models and animatronic robots, proved an instant success with the public.

The largest influx of visitors came during the spring in response to the re-opening of the Atoll Reef. The Atoll Reef has traditionally been the Park's most popular attraction. The Reef has undergone a HK$65 million refurbishment and is now the largest reef aquarium in the world.

During its first full year of operation, the Ocean Park Conservation Foundation announced a five-year plan involving 16 whale and dolphin projects which include identification of conservation problems, development and executive of action plans, and long-term research to direct and support future marine mammal conservation efforts in the region.

The Foundation also convened the first meeting of the Asian River Dolphin Committee. Scientists from nine countries, including China, and representatives of the IUCN Cetaccan Specialist Group and The Whale and Dolphin Conservation Society met to discuss strategies for protecting threatened marine mammals.

The Ocean Park has an on-going commitment to improve access to the Park's facilities for Hong Kong's disabled residents. This year, new facilities for the disabled included contour models for mechanical rides, tactile maps and guide books for the visually impaired, improved access for wheelchair-bound visitors and the installation of a special gondola for disabled visitors on the new Ferris Wheel.

While the recent difficulties experienced at the Park fall outside this financial year, it would be remiss of me not to congratulate the management and staff on the way they handled the consequences of the tragic Aberdeen landslide.

Through their work, the comfort and safety of both visitors and of the Park's marine mammals, fish and animals were assured, and the Park was able to return to normal operations in a speedy manner. Above all, we owe special thanks also to the Government Flying Service, the Fire Services Department and the Electrical and Mechanical Services Department.

Looking to the future, our long-term development plan is to continue to expand and to better serve the needs of all age groups and interests within the community. In the next year, we expect to have further improvements and add new attractions including the opening of a Mine Train roller coaster and a high-tech simulator ride.

After a year that was both rewarding and eventful, the Ocean Park will continue to work to fulfill its mission to provide a balanced mix of recreation, education and conservation. I believe the Ocean Park is well set to achieve even higher levels of popularity and success.

Thank you, Mr President.

MOTIONS

EMPLOYEES' COMPENSATION ORDINANCE

THE SECRETARY FOR EDUCATION AND MANPOWER to move the following motion:

    "That, with effect from 1 January 1996, the Employees' Compensation Ordinance be amended as follows -
  1. in section 6 -
    1. in subsection (1)(a), (b) and (c), by repealing "$15,000" and substituting "$18,000";
    2. in subsection (2), by repealing "$219,000" and substituting "$262,000";
    3. in subsection (5), by repealing "$12,000" and substituting "$14,000";
  2. in section 7 -
    1. in subsection (1)(a), (b) and (c), by repealing "$15,000" and substituting "$18,000";
    2. in subsection (2), by repealing "$248,000" and substituting "$297,000";
  3. in section 8(1)(a) and (b), by repealing "$297,000" and substituting "$356,000";
  4. in section 11(5), by repealing "2,250" where it twice appears and substituting "2,450";
  5. in section 16A(10) -
    1. in paragraph (a), by repealing "$350" and substituting "$420";
    2. in paragraph (b), by repealing "$700" and substituting "$840";
  6. in section 17A(1) -
    1. in paragraph (a), by repealing "$350" and substituting "$420";
    2. in paragraph (b), by repealing "$700" and substituting "$840";
  7. in section 36C, by repealing "$24,000" and substituting "$28,000";
  8. in section 36J, by repealing "$74,000" and substituting "$86,000";
    1. in paragraphs 1(b), 2(b) and 3 of the Third Schedule, by repealing "$120" and substituting "$160"."

He said (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

The purpose of this resolution is to revise the levels of compensation and certain compensation-related items under the Employees' Compensation Ordinance. The Ordinance provides for payment of compensation by employers to employees who are injured or killed as a result of employment-related accidents. Our policy since 1978 has been to review the levels of compensation every two years to take account of wage movements, inflation and other changes. The existing levels of compensation have been in force since 1 January 1994 and are now due for revision. We propose that the revised rates should take effect as from 1 January 1996.

We propose to increase the ceiling for monthly earnings from $15,000 to $18,000. This figure is the basis on which the maximum amounts of compensation for permanent total incapacity and for death are calculated under the Ordinance. We also propose to increase the minimum levels of compensation for death from $219,000 to $262,000, and for permanent total incapacity from $248,000 to $297,000. In addition, we propose that the maximum amount of compensation for the costs of care required by another person be revised from $297,000 to $356,000. For late payment of compensation, we propose to increase the minimum amount of surcharge imposed upon expiry of the payment period from $350 to $420 and the minimum additional surcharge imposed three months after expiry of payment period from $700 to $840. Each of these six proposed revisions represents an increase of about 19.7% over the existing levels, which is in line with the increase in nominal wages during the past two years.

The ceilings on three other forms of compensation are to be adjusted to take account of inflation since their last revision in 1994. The proposed changes include increasing the maximum amount for burial expenses from $12,000 to $14,000, and increasing the maximum payments to be made by an employer towards the costs of supplying and fitting a prosthesis or a surgical appliance from $24,000 and $74,000 respectively to $28,000 and $86,000 respectively.

We also propose to raise the maximum daily rate of reimbursement of medical expenses from $120 to $160 to take account of the increase in fees charges by public hospitals and clinics since 1994.

Finally, we propose to revise the amount that is deemed to be the minimum earnings per month for the purpose of calculating compensation from $2,250 to $2,450. This proposed increase serves to keep the deemed minimum earnings of an injured employee broadly in line with the existing rate of payment to a singleton under the Comprehensive Social Security Assistance Scheme.

These proposals have been endorsed by the Labour Advisory Board and I recommend them to this Council for approval.

Mr President, I beg to move.

Question on the motion proposed.

MR LAU CHIN-SHEK (in Cantonese): Mr President, I certainly support today's motion which seeks to increase the rate of compensation for workers who were injured or even killed in the course of their work. However, I would also like to take this opportunity to state again what I think are the shortcomings of the present Employees' Compensation Ordinance, hoping that the Government will review the whole system of workers' compensation as soon as possible.

The legislation currently in force has stipulated various ceilings for calculating the rate of compensation for workers who have permanently lost the ability to work in the course of their work and has made it impossible for workers to obtain the compensation that they deserve. First, concerning the calculation of the monthly wage ceiling. Although today's motion seeks to increase the monthly wage ceiling from $15,000 to $18,000, that is still an unreasonable restriction, especially in the construction sector in which workers suffer serious injuries. For the many steel fixers, scaffold erectors and the majority of other professionals who may be earning a monthly wage exceeding $18,000, the present legislation has undoubtedly deprived them of the compensation that they deserve. Therefore the Government should consider abolishing the monthly wage ceiling. In fact, the present monthly wage ceiling for the calculation of severance pay and long service payment has already been increased to $22,500, but that for the calculation of workers' compensation is only to be increased to $18,000. This is obviously an unfair treatment to workers claiming workers' compensation.

Second, concerning the upper limit of the amount of compensation. According to the Employees' Compensation Ordinance, the maximum amount of compensation which workers can claim of the basis of injury or death sustained in the course of work is equivalent to seven years or eight years of their total income respectively. These ceilings, which have been set without and objective criteria, are particularly unfair to young workers seeking workers' compensation. For instance, a 17-year-old summer job worker was killed in an accident involving a hoist in North Point in June 1993. According to the law, he could only obtain compensation equivalent to eight years of his total wage and deductions had to be made according to the family's reliance on him. As a result, this worker's family could only obtain compensation amounting to $100,000 plus. Do you think that is fair? Human life is invaluable and the law which has imposed various restrictions on workers' compensation should absolutely be reviewed and improved. The Government may think that workers claiming workers' compensation can try to obtain more by suing their employers for negligence through civil proceedings. However, legal proceedings not only involve many problems of evidence, they are also very time-consuming; and a law suit will normally drag on for three to five years. That is undoubtedly unfair to the injured workers and their families. Therefore, I think a comprehensive review on the Employees' Compensation Ordinance should be conducted without delay so as to strengthen the protection given to workers claiming workers' compensation. Of course, what is more important is to improve industrial safety in Hong Kong so as to prevent the occurrence of accidents.

Mr President, with these remarks, I hope the Secretary for Education and Manpower can clearly respond to my demands in his concluding speech later on. Thank you.

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, I would like to thank the Honourable LAU Chin-shek for his speech as well as his support for this motion. I have listened very carefully to the views expressed by Mr LAU on some items. The Government will consider these views in detail in the next review. There is no doubt that we will fully consider the views of both the employers and employees with regard to this Ordinance in every review.

Thank you, Mr President.

Question on the motion put and agreed to.

PNEUMOCONIOSIS (COMPENSATION) ORDINANCE

THE SECRETARY FOR EDUCATION AND MANPOWER to move the following motion:

    "That, with effect from 1 January 1996, the Pneumoconiosis (Compensation) Ordinance be amended as follows -
  1. in the First Schedule -
    1. in paragraph 1 of Part II, by repealing "$2,100" and substituting "$2,570";
    2. in Part IV, by repealing "$3,500" and substituting "$4,050";
    3. in Part VI, by repealing "$12,000" and substituting "$14,000";
  2. in the Second Schedule, in paragraphs 1(b), 2(b) and 3 of Part I, by repealing "$120" and substituting $160".

He said (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

The purpose of this resolution is to revise the levels of compensation and certain compensation-related items under the Pneumoconiosis (Compensation) Ordinance. The Ordinance provides for payment of compensation for persons who were diagnosed after 1 January 1981 to be suffering from pneumoconiosis. We propose that the revised rates should take effect as from 1 January 1996.

We propose to raise the ceilings in respect of two items of compensation under the Ordinance to take account of inflation and wage movements since July 1993. First, we propose to increase the amount for calculating the monthly compensation for total incapacity, from $2,100 to $2,570. In this respect, it should be noted that under the Pneumoconiosis (Compensation) (Amendment) Bill which was introduced into this Council on 6 December 1995 (that is last Wednesday), the amount of $2,100 was proposed to be made a separate compensation item for pain, suffering and loss of amenities which would be paid to all eligible pneumoconiotics regardless of their degree of incapacity. Therefore, if this proposed revision is approved, we will move a Committee Stage Amendment to the Bill to revise the amount to $2,570. Secondly, we prepare to increase the amount of compensation for care and attention from $3,500 to $4,050.

OFFICIAL RECORD OF PROCEEDINGS
Wednesday, 13 December 1995
The Council met at half-past Two o'clock

MEMBERS PRESENT

THE PRESIDENT
THE HONOURABLE ANDREW WONG WANG-FAT, O.B.E., 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 MARTIN LEE CHU-MING, Q.C., J.P.

DR THE HONOURABLE DAVID LI KWOK-PO, O.B.E., LL.D. (CANTAB), J.P.

THE HONOURABLE NGAI SHIU-KIT, O.B.E., J.P.

THE HONOURABLE SZETO WAH

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

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

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

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

DR THE HONOURABLE EDWARD LEONG CHE-HUNG, O.B.E., J.P.

THE HONOURABLE ALBERT CHAN WAI-YIP

THE HONOURABLE CHEUNG MAN-KWONG

THE HONOURABLE CHIM PUI-CHUNG

THE HONOURABLE FREDERICK FUNG KIN-KEE

THE HONOURABLE MICHAEL HO MUN-KA

DR THE HONOURABLE HUANG CHEN-YA, M.B.E.

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 HENRY TANG YING-YEN, J.P.

THE HONOURABLE JAMES TO KUN-SUN

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

DR THE HONOURABLE PHILIP WONG YU-HONG

DR THE HONOURABLE YEUNG SUM

THE HONOURABLE HOWARD YOUNG, J.P.

THE HONOURABLE ZACHARY WONG WAI-YIN

THE HONOURABLE CHRISTINE LOH KUNG-WAI

THE HONOURABLE JAMES TIEN PEI-CHUN, O.B.E., J.P.

THE HONOURABLE LEE CHEUK-YAN

THE HONOURABLE CHAN KAM-LAM

THE HONOURABLE CHAN WING-CHAN

THE HONOURABLE CHAN YUEN-HAN

THE HONOURABLE ANDREW CHENG KAR-FOO

THE HONOURABLE PAUL CHENG MING-FUN

THE HONOURABLE CHENG YIU-TONG

THE HONOURABLE ANTHONY CHEUNG BING-LEUNG

THE HONOURABLE CHEUNG HON-CHUNG

THE HONOURABLE CHOY KAN-PUI, J.P.

THE HONOURABLE DAVID CHU YU-LIN

THE HONOURABLE ALBERT HO CHUN-YAN

THE HONOURABLE IP KWOK-HIM

THE HONOURABLE LAU CHIN-SHEK

THE HONOURABLE AMBROSE LAU HON-CHUEN, J.P.

DR THE HONOURABLE LAW CHEUNG-KWOK

THE HONOURABLE LAW CHI-KWONG

THE HONOURABLE LEE KAI-MING

THE HONOURABLE LEUNG YIU-CHUNG

THE HONOURABLE BRUCE LIU SING-LEE

THE HONOURABLE LO SUK-CHING

THE HONOURABLE MOK YING-FAN

THE HONOURABLE MARGARET NG

THE HONOURABLE NGAN KAM-CHUEN

THE HONOURABLE SIN CHUNG-KAI

THE HONOURABLE TSANG KIN-SHING

DR THE HONOURABLE JOHN TSE WING-LING

THE HONOURABLE MRS ELIZABETH WONG CHIEN CHI-LIEN, C.B.E., I.S.O., J.P.

THE HONOURABLE LAWRENCE YUM SIN-LING

PUBLIC OFFICERS ATTENDING

THE HONOURABLE DONALD TSANG YAM-KUEN, O.B.E., J.P. FINANCIAL SECRETARY

THE HONOURABLE JEREMY FELL MATHEWS, C.M.G., J.P. ATTORNEY GENERAL

MR CHAU TAK-HAY, C.B.E., J.P. SECRETARY FOR RECREATION AND CULTURE

MR NICHOLAS NG WING-FUI, J.P. SECRETARY FOR CONSTITUTIONAL AFFAIRS

MRS KATHERINE FOK LO SHIU-CHING, O.B.E., J.P. SECRETARY FOR HEALTH AND WELFARE

MR JOSEPH WONG WING-PING, J.P. SECRETARY FOR EDUCATION AND MANPOWER

MR BOWEN LEUNG PO-WING, J.P. SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS

MR KWONG KI-CHI, J.P. SECRETARY FOR THE TREASURY

MR FUNG TUNG, O.B.E., J.P. SECRETARY FOR HOUSING

CLERKS IN ATTENDANCE

MR RICKY FUNG CHOI-CHEUNG, SECRETARY GENERAL

MR LAW KAM-SANG, DEPUTY SECRETARY GENERAL

MISS PAULINE NG MAN-WAH, ASSISTANT SECRETARY GENERAL

MR RAY CHAN YUM-MOU, ASSISTANT SECRETARY GENERAL

PAPERS

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

Subject

Subsidiary LegislationL.N. No.

Road Traffic (Public Service Vehicles) (Amendment) (No. 5) Regulation 1995 562/95

Hong Kong Airport (Restricted Areas and Tenant Restricted Areas) Order563/95
Road Traffic (Breath Analysing Instruments and Screening Devices) Notice564/95
Toys and Children's Products Safety (Safety Standards) Notice565/95
Official Languages (Authentic Chinese Text) (Road Tunnels (Government) Ordinance) Order(C) 118/95
Official Languages (Authentic Chinese Text) (Tate's Cairn Tunnel Ordinance) Order (C) 119/95

Sessional Papers 1995-96

No. 37─The Prince Philip Dental Hospital Hong Kong Report by the Board of Governors for the period 1 April 1994 - 31 March 1995
No. 38─Ocean Park Corporation Annual Report 1994-95
No. 39─Emergency Relief Fund Annual Report by the Trustee for the year ending on 31 March 1995
No. 40─ Social Work Training Fund Thirty-fourth Annual Report by the Trustee for the year ending on 31 March 1995
No. 41─ Chinese Temples Fund Income and Expenditure Account with Balance Sheet and Certificate of the Director of Audit for the year ended 31 March 1995
No. 42─ General Chinese Charities Fund Income and Expenditure Account with Balance Sheet and Certificate of the Director of Audit for the year ended 31 March 1995
No. 43─ Report of the Brewin Trust Fund Committee on the Administration of the Fund for the year ended 30 June 1995
No. 44─ Grantham Scholarships Fund Income and Expenditure Account with Balance Sheet and Certificate of the Director of Audit for the year ended 31 August 1995
No. 45─ Queen Elizabeth Foundation for the Mentally Handicapped Report and Accounts 1994-95
No. 46─ The Accounts of the Lotteries Fund 1994-95
No. 47─ Hong Kong Housing Authority 1994-95 Annual Report
No. 48─ Hong Kong Housing Authority Annual Accounts for the year ended 31 March 1995 and Balance Sheet as at that date

ORAL ANSWERS TO QUESTIONS

Mother Tongue as Medium of Instruction in Secondary Schools

1.MR IP KWOK-HIMasked (in Cantonese): Mr President, according to the findings of a research conducted by the Education Department, it is more appropriate for about 70% of Form One students to receive education in their mother tongue, but there are only 100 secondary schools (accounting for less than 20% of all the secondary schools in the territory) which have adopted the mother tongue as the medium of teaching. In this connection, will the Government inform this Council:

  1. whether it has promoted the importance of mother-tongue teaching to parents of secondary school students; if so, what are the details, and what achievement it has made in this regard; and
  2. what plans does the Government have to make more schools accept and adopt mother tongue teaching?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, the Government's policy is to encourage secondary schools to adopt Chinese as the medium of instruction, to allow individual schools to exercise discretion in the choice of their medium of instruction after taking into consideration whether their students can learn effectively in Chinese or English, and to strongly discourage the use of mixed code in schools. This policy is based on the following considerations:

  1. that teaching and learning are generally more effective through the mother tongue; and
  2. that while students can learn more effectively in their mother tongue, those who have the ability to learn effectively in English should be given the opportunity to do so if they so wish.

Since 1994, parents of Primary six students have been provided with information on their children's language ability in Chinese and English. Schools have since been categorized into three groups as follows:

  1. schools which should use Chinese as the medium of instruction;
  2. schools which may use either Chinese or English as the medium of instruction; and
  3. schools which may use Chinese or English for some classes and should use Chinese only for other classes as the medium of instruction.

At the same time, the Education Department has been vigorously promoting the benefits of mother tongue teaching by:

  1. publicizing the results of research studies undertaken by the Education Department in conjunction with the University of Hong Kong and the Chinese University of Hong Kong between 1987 and 1994 on using the mother tongue as the medium of instruction. These studies indicated that students generally learned and performed better with their mother tongue adopted as the medium of instruction, particularly in language-loaded subjects. Abstracts of these results have been distributed to all kindergartens, and primary and secondary schools. The Education Department has also produced video tapes on the basis of the information concerned. Starting from 1995, such information is also given, in the form of pamphlets, to all parents of Primary six students who will have to choose a secondary school for their children;
  2. producing posters for schools to display on parents' days;
  3. holding roving exhibitions to explain the Government's policy on medium of instruction and the findings of the relevant research studies; and
  4. organizing seminars for secondary school headmasters on how to effectively implement mother tongue teaching.

As a result of these efforts, the number of schools adopting Chinese as the medium of instruction for all subjects except English has increased from 52 in 1994 to 69 this year. In fact, some 280 secondary schools or 70% of all the secondary schools use Chinese as the medium of instruction to varying degrees. Of these, some 150 schools use Chinese for most of the subjects.

To encourage more schools to use Chinese as the medium of instruction in the coming years, the Education Department will continue to adopt preferential measures which include -

  1. providing additional teachers of English, movable partitions, wirefree induction loop systems as well as one-off library grants to enhance English teaching and learning;
  2. providing training courses to prepare teachers to teach in Chinese;
  3. providing incentives for publishers to produce good quality Chinese textbooks in various subjects ─ the Finance Committee of this Council has recently approved $54 million for implementing phase four of the incentive scheme; and
  4. compiling glossaries of technical terms in both Chinese and English for major subjects.

In addition, the Education Department is currently conducting a three-year longitudinal study starting in 1994 to gauge the effects of different modes of medium of instruction on the academic achievement and learning process of Form One to Form Three students. Based on these findings, we will formulate and issue to schools clear-cut guidelines in 1997 on the appropriate medium of instruction to be adopted from September 1998 onwards.

These efforts will be reinforced by the following publicity activities to be launched by the Department in this fiscal year of 1995-96:

  1. To organize eight seminars on the benefits of mother tongue teaching for primary school teachers in the hope that they will pass the message on to pupils and parents;
  2. To produce television programmes and Announcements of Public Interest (API) on radio, targeting specially on parents;
  3. To put up posters at MTR stations;
  4. To prepare and distribute new pamphlets to parents of Primary Four to Primary Six students; and
  5. To publicize, through the mass media, successful examples of schools adopting mother-tongue teaching, particularly the outstanding achievements of their students with a view to promote mother-tongue teaching.

The total cost of these activities is estimated at $2.6 million.

MR IP KWOK-HIM (in Cantonese): Mr President, I would like to know more about the three-year longitudinal study which commenced in 1994 that the Secretary for Education and Manpower has mentioned earlier. He said that this study sought to assess different modes of medium of instruction. I would very much like to know clearly the content of this study. Can the Secretary provide more detailed information? What specific measures can the Administration take subsequent to the completion of the study to render mother-tongue teaching more acceptable to parents?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, this study which began in 1994 and which has mainly used 60 schools as samples, seeks to examine the progress of learning of students from Form One to Form Three who are taught in different modes of medium of instruction. The main purpose of this is that we would very much like to see the findings of this study match our previous studies, thus proving that the academic achievements of students learning through their mother tongue in this period (from Form One to Form Three) are better than students being taught under the so-called mixed code teaching approach. We will subsequently implement the guidelines which have already been issued to schools on the basis of the findings. Under the guidelines which we have issued to schools, as I have explained in the main reply, it is stated that some schools should use Chinese as the medium of instruction, some may use either Chinese or English while some should use Chinese only for some classes and use English or Chinese for other classes for better results. We very much hope that the findings of the study will further boost the confidence of schools and particularly parents in the effectiveness of mother-tongue teaching so that we can issue in 1997 a set of clear-cut guidelines as I have mentioned in the main reply, advising all schools to observe the guidelines of the Education Department and formally implement the policy of mother-tongue teaching across the board from the 1998 school year onwards.

PRESIDENT: I have four more names on my list and I draw a line there.

MR CHEUNG MAN-KWONG (in Cantonese): Mr President, it is mentioned in the main reply that the Government plans to issue a clear-cut guideline in 1998 to schools which are suitable only for mother-tongue teaching, asking these schools to adopt mother-tongue teaching for the benefits of their students. Can the Government inform this Council whether this clear-cut guideline is binding or is it just a "toothless tiger"? If these schools do not comply with this guideline of the Education Department, what measures will the Government take to ensure compliance?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, the guidelines will be issued in 1997, which is, in other words, two years away. We very much hope that in the next two years, through the series of measures and promotional campaigns that I have discussed in the main reply, an increasing number of schools will follow our guidelines by adopting the kind of language that we suggest to them as the medium of instruction. In consideration of the point that the Honourable CHEUNG Man-kwong raised just now, I will look into the need to draw up certain rules when the guidelines are issued in 1997. Of course, I can say that where secondary schools in Hong Kong are concerned, public secondary schools in particular, some of them are government schools and some are subsidized by the public fund. If we need to make the guidelines binding in implementation, even though the guidelines are not legally binding, there will certainly be other alternatives that we can consider to achieve this end. However, I do not wish to make a decision now regarding to what extent the guidelines are binding because I very much hope that through our on-going efforts, more and more schools will accept the guidelines that we have already issued to them.

MR LEUNG YIU-CHUNG (in Cantonese): Mr President, I would like to follow up part (b) of the question. At present, secondary schools or secondary school teachers have found it rather difficult to accept mother-tongue teaching. The reason for that, I believe, relates to the medium of instruction at our universities because at present, as the Secretary for Education and Manpower has mentioned, it is not compulsory for our universities to adopt a particular kind of language as their medium of instruction. This has puzzled secondary school teachers who are at a loss as to how the medium of instruction used in secondary schools can be linked up to that used at our universities. There are difficulties in the convergence of the medium of instruction particularly in subjects such as science, mathematics or natural science. May I ask the Secretary this: while secondary school teachers and secondary schools are being talked into adopting mother-tongue teaching in their schools, how can the Administration convince them that the difficulties faced by their students in respect of the medium of instruction used at our universities will be eliminated?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, from what I understand as the main point of Mr LEUNG's question, he is, perhaps, worried that students who study in Chinese-medium secondary schools may face certain difficulties when they go to university. I, however, do not quite agree with him. It is because basically, we have conducted a lot of studies and we have been telling parents since 1994 that in actual fact, some 33% of students in the territory can learn through either Chinese or English while a majority of the rest of the students should learn through their mother tongue, namely Chinese, in secondary schools. For students who learn through Chinese, I think they would not have problems in other disciplines when they study at university because there are such reference books as bilingual glossaries of technical terms. I have to stress that the mother-tongue teaching approach that I have presented just now does not mean that the subject of English must also be taught in Chinese. The subject of English can be taught in English. Therefore, the point I am making is that learning through the mother tongue does not necessarily mean a lowering of the English standard. Besides, as I have mentioned in the main reply, the Government will provide plenty of support to Chinese-medium schools, which includes additional teachers of English.

MRS SELINA CHOW (in Cantonese): Mr President, as the Secretary for Education and Manpower has mentioned just now that while suggestions have been made to schools, very few schools seem to have adopted mother-tongue teaching of their own accord. There are a mere 69 schools which have adopted such approach so far while 70% of the schools have not yet accepted this approach. While that clear-cut guideline is to be issued only in 1998, can it be put across to schools earlier, telling them that this policy will definitely be implemented in 1998 so that they can make a choice earlier and actively change their language policy?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, as a matter of fact, all secondary schools know well and have received from the Education Department instructions as to which language, be it Chinese or English, should be adopted as the medium of instruction. Therefore, all schools are already aware of the guidelines. But why do we have to issue a set of guidelines in more explicit terms in 1997? As I have stated in the main reply, it is because a three-year longitudinal study was launched in 1994, seeking to collect data that are objective and which should be more convincing to both schools and parents to prove that learning through the mother tongue is effective indeed. Given that the study which started in 1994 will take three years, we can only have the findings in 1997. Such being the case, I hope to issue the clear-cut guidelines only in 1997 to dovetail with the findings of this three-year study. Yet, it does not mean that we are going to stop the measures in the interim. We will, as I have mentioned in the main reply, continue with the promotional and supportive measures concerned in order to encourage more schools to observe our guidelines.

MR ANTHONY CHEUNG (in Cantonese): Mr President, although the Secretary for Education and Manpower has mentioned in his reply just now that some research studies showed that students who are taught in their mother tongue have demonstrated better performance in learning and that the Government has provided additional resources to support mother-tongue teaching in schools, the reality is that a great majority of secondary schools are reluctant to fully adopt the mother tongue as the medium of instruction. What are the reasons for this? Is it due to resistance from parents who are reluctant to let their children learn in their mother tongue? Are they worried that their children may face difficulties when they go to university; or is it because of reservations on the part of employers? Has the Government formulated any plans before, or does it have any at present, to conduct substantial studies in an effort to solicit the opinions of the community, including those of employers, universities or parents on mother-tongue teaching?

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, the question raised by Mr CHEUNG consists of several parts. First, he asked why many schools remain unwilling to observe the guidelines of the Education Department and adopt mother-tongue teaching. This is due to a number of reasons. Of course, on the one hand it is because of the attitude of parents, many of whom tend to feel that English-medium teaching will help improve their children's proficiency in English and this will be advantageous to their children in further studies and in seeking future employment. Another reason, which correlates with the above, is that some schools believe that if they switch from English-medium to Chinese-medium teaching, they might end up having to accept students with a lower academic standard owing to the attitude of parents in choosing schools for their children.

As to how we are going to allay their anxieties, first of all, as I have mentioned in the main reply, we will on the one hand publicize the effectiveness of mother-tongue teaching through promotional campaigns and on the other hand, as we have already mentioned, there is the three-year longitudinal study. We hope that more convincing and objective information will be obtained to prove the effectiveness of mother-tongue teaching. In the meantime, I also have to emphasize that we will continue to convey the message to parents that mother-tongue teaching will not in the least lower the students' English standard because the lowering of English standard may be due to a diversity of factors. Moreover, despite mother-tongue teaching, the subject of English can still be taught through the medium of English. In this connection, we will reinforce this message to parents.

Hospital Authority Merit Payments to Senior Staff

2. MR CHAN WING-CHANasked (in Cantonese): Mr President, will the Government inform this Council:

  1. whether merit payments are granted to senior executives of the Hospital Authority; if so, what are the criteria for granting such payments, which types of executives are eligible for receiving such payments, and what is the basis for determining the amount granted; and
  2. of the annual amount appropriated for such payments by the Hospital Authority over the past three years?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, the Chief Executive and Hospital Chief Executives are senior executives of the Hospital Authority whose remuneration contains a performance related element. Such payments are determined by assessment panels set up to evaluate the overall performance of individual executives in discharging their management duties and achieving agreed service targets.

In the case of Hospital Chief Executives, the assessment panel comprises members of the Hospital Authority Board as well as the respective Hospital Governing Committees, and the payment ranges from 0% to 15% of pay. In the case of the Chief Executive, the assessment panel comprises Hospital Authority Board members, and the payment ranges from 0% to 30% of pay.

The amounts of performance related payments granted by the Hospital Authority in 1992-93, 1993-94 and 1994-95 were in the order of $0.6 million, $4 million and $7 million respectively.

MR CHAN WING-CHAN (in Cantonese): May I ask the Government if it is appropriate to set up this merit payment scheme for the Hospital Authority? If the Government considers this merit payment scheme appropriate, why is it that only a small handful of people in the higher echelons are eligible for this payment? Does the Hospital Authority think that other than this small handful of people, the efforts of other members of staff are not worthy of commendation and reward?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, this merit payment seeks to provide a mechanism to ensure that the performance of senior executives is up to a certain standard. In this connection, it is necessary to establish an administrative framework and set certain targets. This is a scheme drawn up by the Hospital Authority with the approval of the Government. Under the circumstances, it is an internal administrative decision of the Hospital Authority that such payment is made to senior executives and not to be granted to other members of staff.

PRESIDENT: I have four more names on my list and I draw a line there. May I again remind Members to keep their supplementary single-barrelled and keep the preambles very, very short indeed.

MR CHAN KAM-LAM (in Cantonese): Mr President, at present, a great majority of the Government's appropriation to the Hospital Authority and the main revenue of hospitals is spent on expenses relating to manpower and staffing matters. Under this system, how can the Government prevent individual executives who seek to procure a higher merit payment from deliberately suppressing departmental expenditures so that the money will go into the pockets of these executives?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, the performance related payment is meant to reward those members of staff who can meet the targets of improving the services. This payment is drawn from the money set aside for remuneration at a designated rate. Therefore, no extra expenses will be incurred. Nor will it have any impact on the expenditure required for the provision of services to patients. The Hospital Authority has a mechanism in place to determine the eligibility of their staff for this merit payment. As I said in the main reply, in the case of the Chief Executive, an assessment panel under the Hospital Authority Board is set up and in the case of Hospital Chief Executives, a panel comprising members of the Hospital Authority Board and the respective Hospital Governing Committees is set up to assess their eligibility. Therefore, I believe there is adequate information provided for the assessment and this payment will not jeopardize the services to patients.

MISS CHAN YUEN-HAN (in Cantonese): Mr President, I am not challenging the management system of the Hospital Authority. However, the fact is that rumours are spreading in the community. From the figures just presented to us by the Government, the granting of this payment alone in 1994-95 already amounted to $7 million. If we calculate on the basis of the data that the Government has provided us earlier which indicate that there are 40 executives in the senior management level, 40 people sharing this $7 million will mean over $170,000 for each person. Given that the Hospital Authority is a non-profit-making institution, does the Government consider this merit payment scheme appropriate? I have to stress that at a time particularly when we are discussing inadequate expenditure on medical services, is it a right thing to do to adopt such a scheme?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, I think what the Honourable Miss CHAN Yuen-han has said may just be her personal opinion. But I can explain to Members that this payment has increased annually on a progressive basis because the newly introduced administrative framework is only implemented gradually. It was not commenced in full in 1992. It was only in 1994-95 that all Hospital Chief Executives required were recruited and this explains the annual increase in the payment. As for the question of appropriateness and whether this payment should be granted, the Hospital Authority can make its own decisions on the remuneration for their staff.

DR LEONG CHE-HUNG (in Cantonese): The Secretary for Health and Welfare revealed in her reply just now that the annual amount of merit payment is on the rise progressively. Does this mean that there are more and more senior executives, or that the executives are doing their jobs better and better?

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): I have in fact answered half of the question. First, there has been an increase in the number of executives between 1992 and 1995. Secondly, the executives have more opportunities each year to show good performance. Thirdly, I have to point out that not all the executives will definitely be granted this payment.

MR CHOY KAN-PUI (in Cantonese): Mr President, is the morale of staff in the lower ranks affected by the merit payment and bonus scheme for senior executives of the Hospital Authority? How will the administration and operation of the Hospital Authority be affected without this scheme? In view of the concept of linking up charges with the cost, will patients be made to pay higher medical fees as a result of a rise in the cost due to this bonus system?

PRESIDENT: I think there were three questions.

SECRETARY FOR HEALTH AND WELFARE (in Cantonese): Mr President, first of all, I have to stress that the payment is not a bonus. It is a payment determined by performance and it is clearly set out in the letters of appointment that such payment is granted only on the ground of good performance. It is part of the income, not a bonus, and the Hospital Authority is, as Members have pointed out just now, a non-profit-making institution. As to the question of whether there is any impact on the morale of other members of staff, as far as I know and from the information provided to me by the Hospital Authority, the morale is not affected. The granting of this payment and the charges for medical services are two entirely different matters, which are not in the least related.

Chief Executive (Designate) and Team Designate 3.

MR LEE WING-TAT asked (in Cantonese): Mr President, as the Chief Executive (Designate) and Principal Officials (Designate) the Team Designate will be appointed in 1996, will the Government inform this Council:

  1. what is the composition of the Team Designate as the Government understands it;
  2. whether, in regard to providing assistance to the Special Administrative Region (SAR) Government (Designate) in its work during the transition, the Government will provide assistance to the Principal Officials (Designate), Executive Councillors (Designate) or the Team Designate as a whole in addition to providing assistance to the SAR Chief Executive (Designate);
  3. in what ways will such assistance be given; and
  4. whether the Government will urge the British Government to request the Chinese Government to state clearly that the secretariat consisting of a few hundred staff proposed to be set up by a member of the Preliminary Working Committee (PWC) to provide assistance to the Chief Executive (Designate) will not result in the existence of a "shadow government", and whether the Government will request the British Government to clarify if the PWC's proposal contravenes Section four of the Sino-British Joint Declaration?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, it is not for the Hong Kong Government to define for the Chinese side what the term "Team Designate" stands for. The only occasion that this term had been explained to us was in the context of discussions on the Court of Final Appeal. On that occasion, the Chinese side told us that the Team Designate would be led by the Chief Executive (Designate) and would include the Principal Officials (Designate) and others qualified to take part in the establishment of the Court of Final Appeal.

It is obviously in Hong Kong's interests to ensure that the transition will be as smooth as possible. It is, therefore, essential that we render assistance to the Chief Executive (Designate). In the Governor's policy address, we have already undertaken to do so. The details and the form of such assistance will need to be discussed with the Chinese side.

Under the Joint Declaration, the administration of Hong Kong before 1997 will remain a British responsibility. We have made it clear that we will maintain effective administration of the territory and will not accept any parallel or shadow government. We have noted from recent press reports that the Chinese side have affirmed their support for this principle and that there should not be an alternative centre of power before 30 June 1997.

MR LEE WING-TAT (in Cantonese): By this time next year, there will be many organizations relating to the transition of the Hong Kong Government emerging, including the Preparatory Committee. The Chief Executive (Designate) will be known; and the Executive Councillors (Designate) and Principal Officials (Designate) after 1997 may be appointed in parallel with the existing Administration. How can the Secretary for Constitutional Affairs assure us that the discussions of these many organizations and the views they openly express will not interfere with the operation of the Hong Kong Government and will not affect the effectiveness and the authority of the existing Government in governing Hong Kong, as consistently emphasized by the Chief Secretary?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, I would like to reiterate and stress again the provision in the Joint Declaration. It provides very specifically and very clearly that the administration of this place would be the responsibility of the British Government before 1 July 1997. So there is no question of us abdicating; there is no question of us being confused or confounded by discussions or happenings elsewhere. We would continue to maintain a very effective administration of this place before l July 1997.

PRESIDENT: I have four more names on my list, and I will draw a line there.

DR YEUNG SUM (in Cantonese): Mr President, since the Government will establish a liaison office to maintain co-operation with the Team Designate, can the Government inform this Council how such liaison office will report to Members of the Legislative Council? Will it consult Members before any important decision is made?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, as I have explained to Members of the Constitutional Affairs Panel on a number of occasions and as the Governor has indeed also explained in his previous Question and Answer session, our assistance to the Preparatory Committee and in future the Chief Executive (Designate) will be on the principle of openness and transparency and we certainly would keep the Legislative Council fully in the picture of the Hong Kong Government's activities in relation to co-operating with the Preparatory Committee. Of course, it is not the Hong Kong Government's responsibility to explain on behalf of the Preparatory Committee what it does, how it operates and why it operates in a particular fashion. But insofar as the Hong Kong Government's co-operation with the Preparatory Committee is concerned, we would certainly keep Legislative Council Members and the community at large generally informed of our activities. And I would like to also remind Members that our co-operation with the Team Designate, the Preparatory Committee and the Chief Executive (Designate) will be on the three important principles. Firstly, we would not do anything that would be against the Joint Declaration and the Basic Law. We would not do anything that would compromise the Hong Kong Government's commitment to governing this place effectively before 1 July 1997, and we certainly would not do anything that would put civil servants into a position of double or conflicting loyalties.

PRESIDENT: Are you claiming your question has not been answered, Dr YEUNG?

DR YEUNG SUM (in Cantonese): Yes, I am, Mr President. It is because I have also asked the Secretary whether Members of the Legislative Council will be consulted before any important decision is made.

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, I do not quite understand what Dr YEUNG means by "before any important decision is made". Certainly, any decision made by the Preparatory Committee is not a responsibility of the Hong Kong Government. But insofar as how we co-operate, how we help the Preparatory Committee, we have made a commitment that we will certainly keep the community at large, including the Legislative Council, informed of developments. So there is no question of us making a decision on a particular subject. The general mode of co-operation, the general method of co-operation, the general system of co-operation obviously is something that we would let the Council and community know about, and our activities would be fully transparent and fully open. So it is not a question of us doing anything secretly.

MR CHIM PUI-CHUNG (in Cantonese): Mr President, under the existing system of the British Government, the ruling Conservative Party invariably forms its cabinet. The opposition party, namely the Labour Party, also has its shadow cabinet. This should be particularly the case for Hong Kong, which is now in a transition period in the run-up to 1997. In this connection, does the Government consider the establishment of a shadow government or cabinet reasonable and necessary so long as these organizations do not influence the operation of the existing Hong Kong Government?

PRESIDENT: Mr CHIM, are you seeking an opinion from the Secretary, or are you asking for the Government's position on the existence of a Preparatory Committee?

MR CHIM PUI-CHUNG (in Cantonese): Mr President, I raised this question mainly because of the strong resistance of the Government to a shadow cabinet or government. But if these organizations do not affect the operation of the Government, it should be unnecessary to put up any resistance to them. So what is the attitude of the Government towards a shadow government or cabinet which does not affect the operation of the Government?

PRESIDENT: Are you prepared to rephrase your question along my lines?

MR CHIM PUI-CHUNG (in Cantonese): Mr President, most importantly, ......

PRESIDENT: Mr CHIM, you have to rephrase your question.

MR CHIM PUI-CHUNG (in Cantonese): All right, Mr President. Let me re-organize my question. I am saying that ......

PRESIDENT: I am sorry, you have stated your view twice. You are not asking a question, you are seeking Mr NG's personal view on a term called "shadow government".

MR CHIM PUI-CHUNG (in Cantonese): Mr President, my question is this. The Secretary for Constitutional Affairs stated in paragraph three of his reply that the existence of a shadow government will not be accepted. If the so-called shadow government does not affect the operation of the Government, how will the Government deal with this issue? I would not mind if you rule that it is inappropriate for the Secretary to answer this question.

PRESIDENT: Secretary, the Government position, not your personal view please.

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, with your tolerance, I will try to answer the points raised by Mr CHIM.

We have obviously undertaken to provide the Chief Executive (Designate) with the necessary assistance to help him to prepare for the formation of the SAR Government, but the thing to remember is that prior to 1 July 1997, the administration of this place rests in the hands of the Hong Kong Government, through the British Government's responsibility and therefore any planning or preparation by the Chief Executive (Designate) and his supporting team should not undermine the authority of the current Administration and we just fail to see how the question of shadow government comes into the debate. We would be responsible for running this place before 1 July 1997, and indeed Mr CHIM should note, as mentioned in my principal answer, that the Chinese senior officials, and only last week, at least two or three of them, have recently clearly indicated that there would not be any question of a second power centre or a shadow government existing in Hong Kong before 1 July 1997.

MISS EMILY LAU (in Cantonese): Mr President, the Government said in the reply that the details and the form of assistance to be rendered to the Team Designate will need to be discussed with the Chinese side. However, neither do I believe nor accept that the Government, at this point in time, does not have any initial proposal in this regard. I have already put this question to the Chief Secretary when she was here last week. It is my hope that the Government can reveal more information to Members today. As the Government has frequently stressed the high transparency in the future operation of the Government, but if the Government refuses to tell the people of Hong Kong anything right from the start, I think nobody would believe that the Government would, in actual reality, let us know more. Therefore, Mr President, I hope that the Government can tell us right away how does the Government plan to deal with the Chinese Government and what sort of questions will be raised for discussion in an effort to provide assistance?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, I am really surprised to hear Miss LAU saying that we have not said anything about how we are going to help or co-operate with the Preparatory Committee. I will leave the Chief Executive (Designate) for the moment because obviously the Chief Executive (Designate) would have at least another year to go, or at least a long while to go before we would need to face that scenario. But insofar as co-operating with the Preparatory Committee is concerned, if Miss LAU would care to refer to the 1995 Governor's policy address, paragraphs 133 to 137, we did set out the broad framework of how we were to co-operate. We suggested that we would establish a liaison office as a focal point of contact within the Hong Kong Government, as a focal point of liaison, as a focal point of provision of information to the Preparatory Committee. Now the actual size of the liaison office and the actual detailed operation as to how many meetings we hold, are obviously some of the details that we would need to discuss and would need to unfold depending on how the Preparatory Committee would operate in detail or in actual reality. But the framework is clearly set out and the principles of that co-operation are again very clearly set out in the 1995 policy address. With those principles and within that framework, we will be able to co-operate in an effective way with the Preparatory Committee and I can assure Miss LAU that if there are major departures from that framework, from those principles, the Legislative Council will be the first organization to hear about them.

MR HOWARD YOUNG: Mr President, the Secretary for Constitutional Affairs refers in his second paragraph that the details and form of such assistance will need to be discussed with the Chinese side. I would like to know whether this is inferring that the Government plans to have the details and anything to do with assistance only discussed with the Chinese side, which I take it to mean through diplomatic channels, or will it be feasible also that once the Chief Executive (Designate) is known, then surely he should be able to directly discuss with the Hong Kong Government rather than him having to talk to Beijing, Beijing to talk to London, London to talk to Hong Kong, in a very roundabout way? Could the Secretary please clarify this point?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, we certainly do not close our mind to any possible avenues of communication with the Chinese side, on any matter affecting the transition, including of course, how we co-operate with the Preparatory Committee and the Chief Executive (Designate). Mr YOUNG is quite right in pointing out that apart from the established diplomatic channels, there are other opportunities, there are other occasions, there are other well-established avenues where we can communicate with the Chinese side, and as for his reference to when the Chief Executive (Designate) is around, that will be another avenue for us to communicate directly and more conveniently in dealing with the Chinese. It is obviously something we would bear in mind.

PRESIDENT: I will allow one more supplementary as I had overlooked the fact that Mr CHAN Kam-lam had pressed the request to speak button much earlier on.

MR CHAN KAM-LAM (in Cantonese): Mr President, the Secretary for Constitutional Affairs stated in his main reply that it is obviously in Hong Kong's interests to ensure that the transition will be as smooth as possible and it is, therefore, essential that we render assistance to the Chief Executive (Designate). Given that the officials (designate) will be appointed in 1996, may I ask the Government if it should provide the Chinese Government with information of our government officials as soon as practicable so that the Chinese side and the Chief Executive (Designate) will be able to start the work relating to the appointment of officials?

SECRETARY FOR CONSTITUTIONAL AFFAIRS: Mr President, obviously we would provide any information that is necessary or useful to help the Chief Executive (Designate) in the establishment of a new government. But I would not like, at this stage, to speculate as to what exactly would be the type of information that would be required by the Chief Executive (Designate). Our general commitment is to help him as far as we can, but against the three principles, the three broad principles that we have set out. So we would not do anything that would be against any of the three principles.

First-time Home Ownership

4.MR ERIC LI asked (in Cantonese): Since June 1994, the Government has implemented administrative measures to regulate property transactions and a curb property prices in order to enable families in need of a home to have the opportunity to purchase homes for the first time at relatively reasonable prices. In this connection, will the Government inform this Council:

  1. of the number of new residential flats completed between June 1994 and October this year;
  2. what is the number of flats for which transactions have been concluded during the above-mentioned period; whether there is information to show how many of the transactions are in respect of flats purchased by first-time home-buyers; and what is the average vacancy rate during the period in question; and
  3. whether the number of first-time home-buyers and the number of new residential flats referred to in the above-mentioned period have shown an increase when compared with the corresponding figures in each of the three years immediately before the implementation of the measures to regulate property transactions; if not, what are the reasons?

SECRETARY FOR HOUSING (in Cantonese): Mr President, since the introduction of the anti-speculation measures in June 1994,

  1. the number of new residential flats completed up to October 1995 is 76 107 units, including all private and public housing flats;
  2. the number of transactions concluded during the same period is 128 738. No separate statistics are kept on the number of transactions involving first-time home-buyers. The vacancy rate for private domestic flats, which is compiled on an annual basis, was 4.7% in 1994;
  3. the number of new residential flats competed has increased by 4%, 8% and 23% when compared with those in the past three years respectively immediately before the introduction of the new measures.

MR ERIC LI (in Cantonese): Mr President, I think my question is clear enough. It is about the supply of private housing units and their transactions. However, I am disappointed that the reply is incongruous with the question in that it has mixed up the issue with public housing. I am still unable to get a full picture of the outcome reflected by the measures taken. First of all, I hope the Administration would supply us with correct information so that the public may not be misled. The second point, though less obvious, is whether these measures have enabled families in need of a home to purchase homes for the first time. I am sure that such information is what we in this Council want to know. It has now become obvious that these measures have not only lowered the prices of private properties but also reduced their speculation activities. At the same time, the supply of medium-and long-term housing has also decreased. There are less and less suitable private residential flats to attract purchasers, resulting in the presence of many "flats without occupancy". Now, 17 months after the introduction of these measures, the Administration has the audacity to tell us that it still does not know whether or not these measures have enabled those in need of a home to purchase their own homes.

PRESIDENT: What is your question, Mr LI?

MR ERIC LI (in Cantonese): The Administration is even unable to supply us with statistics. Will the Administration assure us when it will carry out a review of the misguided policies so as to let us know, firstly, whether it will increase the supply of medium- and long-term private housing, not just land supply (unless it is the intention of the Administration that the people should sleep on streets) and secondly, whether it can supply us with correct figures to show if families in need of a home have the opportunity to purchase their own homes?

SECRETARY FOR HOUSING (in Cantonese): Mr President, the Honourable Eric LI has accused me of giving him a confused reply, but I have replied in accordance with the question asked. With your permission, I would like to provide additional information about private property transactions of the past three years or so. The numbers of transactions of private properties were 86 219 in 1992-93, 111 108 in 1993-94 and 111 832 in 1994-95.

As to providing middle-income families with the opportunity to purchase their own homes, I think the SECRETARY FOR HOUSING has on a number of occasions pointed out that there are at present various programmes to help such families to purchase their own homes. In fact, Members have already been provided with so much information on public housing that they may probably not want to hear any more about it. As to private housing, we are of the opinion that there should be enough supply of land to encourage more residential flats to be built. The Government now envisages that 195 000 private residential flats will be built by 2001, hoping that this will help families in need of a home to purchase their own homes. As to programmes to encourage families to purchase their own homes, the Government has, as you all know, gone a long way towards helping the sandwiched class, that is, the middle-income families to achieve this goal. We hope to build at least some of the residential flats for them to purchase. With the increase in the number of public and private housing units during the next few years, I am sure that families wishing to purchase their own homes will have the opportunity to do so.

PRESIDENT: Mr LI, I have to allow time for other Members. I will have to draw a line there.

MR ERIC LI (in Cantonese): Mr President, the Secretary has failed to answer my question which is very simple. We all know that the Housing Branch has many programmes on hand, but what I have asked is: When will the Administration really have a review of the relevant policies carried out? The Administration has never mentioned this point. My second point is about figures. When on earth will the Administration provide us with the figures required? These are the two major points which the Secretary has failed to respond to.

SECRETARY FOR HOUSING (in Cantonese): Mr President, the review report has already been submitted to the Housing Branch. As the relevant figures are still under study, I am unable to provide you today with the exact figures required. Generally speaking, there should not be much difference between the figures of the review and the target figures set by the Government.

DR LAW CHEUNG-KWOK (in Cantonese): Mr President, many people are of the opinion that the slump in the second-hand property market is mainly due to the fact that the Administration has gone too far in interferring with the property market. What factors will the Administration consider in deciding whether or not to relax regulation of the property market?

SECRETARY FOR HOUSING (in Cantonese): Mr President, it would seem that the second-hand property market has somewhat revived during the last month, as can seen from newspaper reports. The programmes introduced by the Government last year have now achieved the expected results. As to private property transactions, we can all see that the market has begun to revive and therefore I think there is no need at the moment to interfere with it or to provide it with any assistance.

MR JAMES TIEN (in Cantonese): Mr President, will the Administration supply this Council with information to indicate how many private building plans have been approved this year, that is, in 1995? I ask this question because, based on the number of building plans approved this year, we can forecast how many buildings will actually be completed in three years. We can thus tell if the number of buildings completed will greatly decrease, as pointed out by the Honourable Eric LI.

SECRETARY FOR HOUSING (in Cantonese): I am sorry, Mr President. I do not have such information off hand, and so I cannot answer this question.

PRESIDENT: Could that figure be supplied in writing subsequently, Secretary?

SECRETARY FOR HOUSING: Yes, Mr President. (Annex I)

MR LEE WING-TAT (in Cantonese): Mr President, everybody knows that the most important way to regulate or to stabilize property prices is to have a steady supply of a large number of private properties. However, there are three unfavourable factors which have worried me a great deal. First, according to the information provided by the Rating and Valuation Department, the production of private properties in 1993 and 1994 was lower than expected. Secondly, there have been fewer redevelopment sites in urban areas. Thirdly, the record vacancy rate of 4.7% means that about 50 000 private domestic flats are vacant. Will the Secretary for Housing ascertain whether these three unfavourable factors will in the long run cause considerable obstruction to the target of providing sufficient private domestic flats for the public? If so, what are the solutions?

SECRETARY FOR HOUSING (in Cantonese): Mr President, the Government has set up a Housing Project Action Team to look into the matter of land supply. As long as the number of flat units exceeds 500, the Team will try its best to help the responsible organization, be it the Housing Authority, the Housing Society or even a private organization, to solve the problem of land supply, or take whatever action to co-operate with the organization concerned. The Team is chaired by the Secretary for Housing. As regards the vacancy rate of 4.7% which means about 50 000 housing units are vacant, I think the vacancy rate has remained at more or less the same level recently. There is no indication that this year's figure is particularly high or particularly low. It has remained at this level during the past few years.

PRESIDENT: Mr LEE, not fully answered?

MR LEE WING-TAT (in Cantonese): I would like to clarify one point. The Secretary for Housing has mentioned that during the past few years, the vacancy rate has remained at 4.7%, which means some 50 000 housing units are vacant. Will the Secretary for Housing inform us of the private housing vacancy rates of the years from 1991 till now? As far as I can remember, the lowest rate is 3.9% and the highest, 4.7%.

SECRETARY FOR HOUSING (in Cantonese): Perhaps I will provide a written reply. (Annex II)

Broadcasting Bill

5.MR ANDREW CHENG asked (in Cantonese): Mr President, the Government indicated to this Council on 2 November 1995 that it would seek the views of interested parties and consult the Chinese side on the Broadcasting Bill (the Bill). In this connection, will the Government inform this Council:

  1. how it will go about seeking such views; whether it will conduct public consultations on major issues arising from the Bill, such as the restrictions on "cross media ownership" and the regulation of "interactive multimedia services", and
  2. what progress has been made to date in its consultation with the Chinese side on the Bill; and what are the specific details of the consultation?

SECRETARY FOR RECREATION AND CULTURE (in Cantonese): Mr President, as drafting of the Bill is still underway, we have not yet decided precisely how the consultation should be conducted, and neither have we initiated consultations with the Chinese side. However, I can say that it is our intention that all interested parties will have an opportunity to comment on all matters in the Bill, and that all comments received will be considered carefully before the Bill is finalized for approval by this Council.

MR ANDREW CHENG (in Cantonese): The Government told this Council in the last Session that it would submit the Bill for deliberation by this Council. We, however, find it very disappointing that the Government did not honour its undertaking. Now the Government is saying again that it would table the Bill at this Council in this Session. Yet, the basic details of the consultation exercise have not been decided while the Chinese side still needs to be consulted. We all know that if the Chinese side is to be consulted on bills which are closely related to the freedom of speech ......

PRESIDENT: Please come to the question, Mr CHENG.

MR ANDREW CHENG (in Cantonese): ...... there will certainly be many people who wish to know more about the Bill. However, the Government has not started consulting the Chinese side and its reply to this Council was extraordinarily brief. For this reason, I deliberately speak at greater length to show my dissatisfaction. May I ask the Government how it can convince the public that the Government would proceed with the drafting of the Broadcasting Bill in this Session? If the Government is not going to proceed with this task, it should say so honestly and should not deceive us.

SECRETARY FOR RECREATION AND CULTURE (in Cantonese): The Honourable Andrew CHENG was disappointed because my reply was too brief. In fact, I painstakingly did so with good intentions. It is because Members have been spending more and more time on the question session so I hope my words can be succinct and to the point by saying only what is needed and leaving out things which are deemed redundant.

I absolutely disagree with Mr CHENG's allegation that we have been deceiving the Legislative Council or members of the public. Mr CHENG can criticize me for being incompetent, brainless or even mediocre. I can stand the most scathing criticizms of all sorts but I have never deceived anybody. We are making an on-going effort in drafting the Bill and we hope we could submit the Bill as early as possible for Member's deliberation.

MRS ELIZABETH WONG: Mr President, I think the Secretary has given a perfect answer to justify negativity and also prolonged delay. I do not think any other civil servant can emulate his perfection. I have heard previously of baking a chestnut cake. I think it is a hard nut to crack. We are still cracking the chestnut.

Will the Secretary inform this Council of the approximate timetable when he is likely to submit his Bill to this Council?

SECRETARY FOR RECREATION AND CULTURE (in Cantonese): Mr President, I am grateful to the Honourable Mrs Elizabeth WONG for thinking so highly of me. I think not many officials here can give a reply which is commended by Members as perfect and I think I deserve it. I can assure Members that it is definitely not a chestnut cake that is being taken out from the oven because chestnut cake would always be the last thing I choose to eat. In response to the question raised by Mrs Elizabeth WONG, I can only recapitulate that at present, the drafting of the Bill is still underway and we hope we could submit the Bill for Members' deliberation as early as possible. Besides, I can only reiterate, as the Acting Secretary for Recreation and Culture said in the written reply to a question on 2 November 1995, that it has always been the plan of the Government to submit the Bill for Members' deliberation in this Session. However, as to the question of when exactly the Bill will be tabled, it will depend on the progress of the drafting work and the time required for consultation with interested parties.

WRITTEN ANSWERS TO QUESTIONS

New Posts in the Political Adviser's Office

6.MISS EMILY LAU asked (in Chinese): It is learnt that three new posts have been created in the Office of the Political Adviser. In this connection, with the Government inform this Council

  1. of the reasons for the creation of these new posts;
  2. of the salary scale and area of responsibilities of each of the posts; and
  3. from which departments the officials presently holding these posts were transferred and what posts did they hold in the departments concerned?

CHIEF SECRETARY: Mr President, the Political Adviser's Office has recently been reorganized, on a trial basis, to bring together those functions of the Hong Kong Government which derive directly from the United Kingdom sovereignty and which will cease in June 1997 when the office will be wound up. This has involved the transfer of certain responsibilities and loan of posts from other Secretariat Branches. The answers to the specific questions are as follows:

  1. No new posts have been created on the establishment of the Political Adviser's Office. However as a result of the reorganization, there are now three additional officers designated as Deputy Political Advisers. Two of these posts are on loan from other Secretariat Branches; the third is an officer filling an existing post which has been retitled;
  2. All these officers are filling existing AOSGC posts at the D2 level. The Deputy Political Adviser (Security) post deals with certain security issues related to the United Kingdom sovereignty. The Deputy Political Adviser (General) post is responsible for contributing to the China advice function and supporting the Political Adviser as a member of the Joint Liaison Group;
  3. The Deputy Political Adviser (Security) is filling the post of Principal Assistant Secretary (Security) D currently on loan from Security Branch. The Deputy Political Adviser (Personnel) is holding the post of Principal Assistant Secretary (Civil Service) Development on loan from Civil Service Branch. The third post, Deputy Political Adviser (General) is an existing AOSGC directorate post in the Political Adviser's Office which has been retitled.

Educational Needs of New Immigrant Children

7. MR EDWARD HO asked (in Chinese): Since the middle of this year, the number of Chinese immigrants arriving daily in the territory for permanent residence has increased from 105 to 150 and many of these immigrants are school-age children. In this connection, will the Government inform this Council:

  1. whether, in the light of the increasing number of children (aged six to 12) from mainland China settling in the territory, the Education Department (ED) has made any assessment and co-ordination of their educational needs at various levels of schooling in the next five to 10 years; if so, what are the details of the assessment and co-ordination plan; if not, why not; and
  2. whether the ED has set up any task force to provide assistance and counselling to such children and their parents to cope with the difficulties the children may encounter in their studies?

SECRETARY FOR EDUCATION AND MANPOWER: Mr President,

  1. To meet the demand for primary school places from an increasing number of Chinese immigrant children who are aged between six and 12 over the next few years, we are committed to building five additional primary schools for completion in 1997-98. In the interim, we are making use of the existing vacancies in primary and secondary schools resultant from an overall decline in our school population to accommodate these children. We shall conduct a review of the longer-term requirements for school places at different levels, including secondary schools, as well as the various support services in 1996.
  2. There is close co-ordination among various sections in the Education Department in the provision of services to immigrant children and their parents. These services include school placement, tailor-made induction programme, remedial teaching, and guidance and counselling service.

On guidance and counselling, student guidance officers/student guidance teachers are stationed in primary schools to assist in:

  1. promoting pupils' positive behaviour, strengthening their motivation towards learning and enhancing their self-esteem;
  2. training on study or social skills so as to enable the pupils to cope with their learning, adjustment or behavioural problems; and
  3. providing individual guidance to help them deal with more complicated adjustment, social or family problems.

Regarding parents, the Education Department has provided subvention to 14 non-government organizations in the 1995-96 school year to run short adaptation courses for adult immigrants. The course contents include the technique to help them cope with the difficulties their children encounter in studies.

The Home Affairs Department has been tasked to monitor and assess the services provided for new arrivals from China to ease the process of integration, to identify groups who are specially at risk, and to recommend the most suitable approach for responding to the practical problems as they emerge.

Reconstruction of Roads in the New Territories

8. MR CHOY KAN-PUI asked (in Chinese): At present, there are still a number of roads in the New Territories which were constructed by the Government many years ago and which have all the time been managed by the Government. These roads, which include Fan Kam Road, the Yuen Long Section of Lam Kam Road and Kam Tin Road, can no longer meet the current standards for highways nor can they cater for the needs of the rapid developments in the New Territories. In view of this, will the Government inform this Council:

  1. of the total number of such roads in the New Territories at present, together with their names and locations; and
  2. whether the Government has formulated a timetable for the reconstruction of these roads to meet the current road standards so as to ensure the safety of road users; if so, what are the respective dates for the commencement and completion of the reconstruction work; if not, why not?

SECRETARY FOR TRANSPORT: Mr President, the road network in the New Territories has developed over the past 50 years. At the time individual roads were constructed, they all fully met the then prevailing standards. Higher standards have evolved over the years resulting in better and more modern roads. However, this does not mean that the other roads are either unsafe or of an unacceptable standard.

It is fully recognized that with the pace of development in the New Territories, some existing roads may not be able to cope with increased levels of traffic. These roads need to be improved. The Lam Kam Road (Yuen Long Section) and Kam Tin Road fall into this category.

The improvements currently proposed cover:

  1. the widening of Kam Tin Road in two stages from the existing single carriageway to dual-two carriageway. The first stage from Au Tau to Kam Tin will start in early 1998 and is scheduled for completion in early 2000. The second stage from Kam Tin to Lam Kam Road will start in 2002 and is scheduled for completion in 2005; and
  2. the widening of Lam Kam Road from Kam Tin Road to Kadoorie Farm from the existing single carriageway to possible dual-two carriageway. This is scheduled to start in 2002 for completion in 2005.

A reconstruction and maintenance programme for Fan Kam Road, Kam Sheung Road, Yuen Long Section of Castle Peak Road and Route Twisk is also in hand and will be completed over the next five years. Improvement measures will include the provision of proper footpaths and drainage.

As regards minor roads, traffic management measures are implemented to maintain safe and efficient movement of traffic. For example, where necessary, speed limits are imposed or certain categories of vehicles are prohibited.

We shall continue to upgrade the road network to keep pace with traffic demand.

Servicing "999" Calls

9. MRS SELINA CHOW asked (in Chinese): It was reported that a member of the public recently had dialed "999" to report a bank robbery but only to receive the recorded reply "the line is busy". In view of this, will the Government inform this Council:

  1. of the average number of police communication personnel responsible for answering "999" calls and the average number of calls they have to handle per shift at present, and how do these figures compare with the corresponding figures in each of the past three years;
  2. of the total number of calls made to "999" to report crime which received the recorded reply "the line is busy" this year;
  3. of the average time currently taken for a call to "999" to be answered by the staff manning the number, and how does this figure compare with those of the past three years?

SECRETARY FOR SECURITY: Mr President, the answers to the three parts of the question are as follows:

  1. There are 18 Police Communications Officers and three Senior Police Communications Officers manning the "999" Consoles per shift in the three Police Regional Command and Control Centres in Hong Kong Island, Kowloon and New Territories. The number of staff deployed for such duties is the same for the past three years. In the first 10 months of this year, each shift handles an average of 445 calls. The average figures for 1992, 1993 and 1994 are 328, 338 and 401 respectively.
  2. The pre-recorded bilingual broadcast message was introduced in September 1994. Our computer system does not capture statistics on the number of calls answered by the message. However, the pre-recorded message invariably asks the caller not to hang up in order that the call could be dealt with as soon as possible.
  3. While we do not have statistics on the average time taken to answer a "999" call in the past three years, the findings of a recent snap-shot survey conducted by the police show that on an average a "999" call is answered within six seconds. It is possible that a caller may need to wait longer than six seconds to get through when a major incident takes place. However, this does not affect the response time of the police because such cases are often reported by more than one caller. For example, in the case referred to in the question, the police received two other reports of the same case at the time of the bank robbery. It should be noted that the first police officer arrived at the scene six minutes from the receipt of the calls.

Implementation of Matrimonial Causes (Amendment) Ordinance 1995

10. MRS MIRIAM LAU asked: The Matrimonial Causes (Amendment) Ordinance 1995 was passed by this Council on 17 May 1995 but it shall come into operation on a day to be appointed by the Secretary for Home Affairs by notice in the Gazette. Will the Government inform this Council of the reasons why, after a lapse of six months since its passage, the Ordinance has still not come into operation; and when it is expected that a notice will be published in the Gazette to bring the Ordinance into operation?

SECRETARY FOR HOME AFFAIRS: Mr President, I share the Honourable Member's wish for the Matrimonial Causes (Amendment) Ordinance (the Amendment Ordinance) to be brought into operation as soon as possible. However, before this can be done, it is necessary for the Matrimonial Causes Rules (the Rules) to be amended to bring court procedures in relation to matrimonial proceedings in line with its provisions. Amendments to the Rules are made by the Chief Justice. The Home Affairs Branch has been co-ordinating the preparation of the necessary amendments to the Rules. The relevant professional bodies are currently being consulted on an advanced draft. We expect to be able to finalize the amendments to the Rules and submit them to the Chief Justice for consideration within the next few weeks.

The Amendment Ordinance will be brought into force at the same time the amendments to the Rules to be made by the Chief Justice come into effect.

Misleading Advertisements

11. MR SIN CHUNG-KAI asked (in Chinese): As certain advertisements broadcast on television and radio, or carried in newspapers and magazines, contain incorrect or exaggerated information which mislead the consumers, will the Government inform this Council:

  1. which government department is responsible for dealing with complaints about advertisements containing incorrect information and how such complaints are handled;
  2. of the number of complaints about advertisements containing incorrect information received by the department concerned, as well as the number of companies which have been prosecuted as a result of such complaints in the past three years; and
  3. what regulatory measures have the Government put in place to ensure that advertisements released through the mass media contain no misleading or incorrect information?

SECRETARY FOR RECREATION AND CULTURE: Mr President, the Broadcasting Authority (BA) issues Codes of Practice in respect of advertising on radio and television. Broadcasters are required under their licence conditions to adhere to these Codes, and to exercise reasonable care and diligence to ensure that the factual claims made in advertisements are correct. Through its executive arm, the Television and Entertainment Licensing Authority (TELA), the BA monitors broadcasts to check for compliance and also acts on public complaints. The BA may warn broadcasters who contravene the Codes, or impose a financial penalty up to a maximum of $250,000. During the last three years, TELA received 110 complaints alleging incorrect information in advertisements broadcast on television and radio. After investigation, 80 of these complaints were found not to have contravened the Codes. Of the remainder, warnings were issued in 27 cases, and three cases have yet to be considered by the BA.

There is no overall control of advertising in the print media, although a variety of Ordinances governs specific types of advertisements. The Undesirable Medical Advertisements Ordinance (Cap. 231) regulates advertisements promoting medical treatments, and is administered by the Department of Health. That Department regularly screens newspapers and warns those who publish undesirable advertisements (or cause them to be published). Where warnings do not suffice, the cases are referred to the police. Over the past three years, 220 warnings have been issued, and six prosecutions taken out.

Under the Protection of Investors Ordinance (Cap. 335), the authorization of the Securities and Futures Commission ("SFC") is required for all advertisements which contain a public offer of securities or investment arrangements, unless otherwise exempted. The SFC authorization vets such advertisements prior to issue for, among other things, incorrect, exaggerated or misleading information. In addition, the SFC also monitors the local papers for unauthorized advertisements and acts on complaints. Over the past three years, it has acted on 15 complaints, mostly by requiring the offending advertisements to be amended or withdrawn. Eight prosecutions have been mounted in recent years.

The Consumer Council also assists consumers to obtain remedies when they complain of incorrect or exaggerated information in advertisements, although it has no powers of prosecution. If appropriate, the Council may refer the case to the Customs and Excise Department for further examination under the Trade Descriptions Ordinance (Cap. 362). Statistics on the number of complaints about advertisements in the print media received by the Consumer Council are not readily available as complaints are entered by product or service specific categories.

Safety Standards for Glassware Products

12. MR CHAN KAM-LAM asked (in Chinese): Will the Government inform this Council:

  1. of the number of accidents involving industrial and household glassware products and installations in the past three years; and
  2. whether it will consider introducing regulations to stipulate the safety standards for glassware products and to require manufacturers to specify on their products the types of glass used and the level of durability measured in an impact-test?

SECRETARY FOR TRADE AND INDUSTRY: Mr President,

  1. We do not have statistics on the number of accidents involving industrial and household glassware products and installations. Industrial accident statistics are analyzed by cause and by industry. There is no breakdown by either the material or the equipment involved in industrial accidents. The Hospital Authority compiles patient statistics according to international classification of diseases. It does not have separate figures on the number of accidents involving use or installation of glassware products.
  2. The safety of glassware products for private use or consumption is already covered by the Consumer Goods Safety Ordinance, which came into force in October this year. This Ordinance imposes a statutory duty on manufacturers, importers and suppliers of consumer goods (including glassware products) to ensure that the goods they supply in Hong Kong are safe. Section 4 of the Ordinance further requires that consumer goods (including glassware products) supplied in Hong Kong must comply with a general safety requirement which includes, inter alia, the adoption of reasonable safety standards published by a standards institute. Any supplier who fails to comply with the requirement under the Ordinance commits an offence. The Commissioner of Customs and Excise will monitor the situation and take enforcement action as appropriate.
    Accordingly, we do not see the need to introduce specific regulations to stipulate the safety standards for household glassware products and to require manufacturers to specify on their products the types of glass used and the level of durability measured in an impact test.

Relocation of Methadone Clinic to Tsui Ping Estate

13. MR FRED LI asked (in Chinese): The 10-year redevelopment programme for Kwun Tong Town Centre proposed by the Land Development Corporation includes the relocation of the methadone clinic at the Town Centre to Tsui Ping Estate nearby. As methadone clinics often bring nuisance to the community in which they are located, will the Government inform this Council:

  1. whether it will consult local community groups and residents in this regard; if so, what are the details; if not, why not;
  2. whether the Government will make alternative arrangements to set up the methadone clinic further away from Tsui Ping Estate in view of the worsening drug abuse problem in that Estate; and
  3. what long-term and interim measures the Government has adopted to tackle the drug abuse problem in the neighbourhood of Tsui Ping Estate?

SECRETARY FOR SECURITY: Mr President,

  1. The Kwun Tong Town Centre Redevelopment Scheme proposed by the Land Development Corporation (LDC) is still being considered by the Corporation and the Administration. If the Scheme is to be implemented, the Kwun Tong District Board, and other relevant local bodies, where appropriate, will be consulted in advance on any proposal to relocate the methadone clinic.
  2. No decision has been made on whether and where the methadone clinic in Kwun Tong should be relocated. The Government is open-minded about the location of methadone clinics. An important consideration is the accessibility of the clinic, as the objective of the methadone programme is to offer a readily accessible out-patient service for those drug abusers who seek treatment but, for various reasons, would not be able to take part in residential treatment programmes.
  3. The drug abuse problem in the neighbourhood of Tsui Ping Estate is being tackled at source by stepped-up law enforcement action, and preventive education and publicity.
    Police enforcement action against drug activities in Tsui Ping Estate has been stepped up. This can be seen from the number of arrests for serious narcotics offences in Tsui Ping Estate, which has increased from 46 in 1994 to 80 in the first nine months of 1995. At the street level, enhanced enforcement actions are taken on a daily basis against drug sellers and users. Information and intelligence on drug activities, with particular emphasis against drug sellers, are collected, collated and acted upon by the Kwun Tong District Special Duties Squad to target known drug sellers.
    The police also contributes to anti-drug education by organizing school visits and seminars with school headmasters and discipline masters, focussing on the prevention of drug abuse by students.
    Extra efforts have been put in preventive educational and publicity measures to arouse awareness among Kwun Tong residents on the drug problem. Emphasis has been laid on enhancing parents' understanding on the prevention and early detection of their children's involvement in drugs. In 1995-96, a total of seven programmes involving 10 000 participants have been/will be implemented by the social welfare service units in the district. Existing counselling services of family service centres and probation offices in the district have also been strengthened to help young people with drug problems and their families.
    The District Social Welfare Office (DSWO) in Kwun Tong has formed a Working Group on "District-wide publicity campaign in combating illicit use of drugs among young people in Kwun Tong District" in April*1995, to promote co-ordination and co-operation among government departments and local organizations to tackle the drug problem. A "Drug Ambassador Scheme" is now being launched by the Working Group, with the aim of publicizing widely anti-drug messages among young people through a signature campaign. So far over 7 000 participants from more than 30 local organizations have been enrolled. The Working Group also compiles leaflets on district beat-drug activities on a regular basis to encourage participation of local residents.
    In the longer term, the DSWO in Kwun Tong will continue to take active part in the Kwun Tong District Fight Crime Committee to plan and co-ordinate anti-drug strategies at the district level. Group work units in the district, particularly the Group Work Unit of the Kwun Tong Community Centre (which is located in Tsui Ping Estate) will organize regular activities to educate young people to stay away from drugs. Services from the "Against Substance Abuse Scheme" provided by the team of specially trained social workers newly set up by the Social Welfare Department would also be tapped whenever necessary.
    A paper on "Illicit use of drugs in Kwun Tong District" was discussed at the Kwun Tong District Fight Crime Committee meeting in May*1995 to co-ordinate district efforts in tackling the problem. Local non-government organizations will be encouraged to organize anti-drug activities through various channels such as the Kwun Tong District Committee on Family Life Education, the Kwun Tong District Group and Community Work Service Co-ordinating Committee. Social workers of the Society for the Aid and Rehabilitation of Drug Abusers working in the methadone clinic in the district will continue to provide casework services to drug abusers to facilitate their social rehabilitation.

Air Services to Taiwan

14. MR LAW CHEUNG-KWOK asked (in Chinese): Will the Government inform this Council:

  1. whether, in order to be eligible to apply for a licence to operate air services between Hong Kong and Taiwan, the China National Aviation Corporation (CNAC) has made a formal application to become an airline whose principal operation is based in the territory; if so, what factors the Government will take into consideration in determining whether a licence will be granted to CNAC to operate the route; if not, whether it will consider inviting CNAC to make such an application; and
  2. what share of the market does the Cathay Pacific Airways (CPA) have in providing air services between Hong Kong and Taiwan, and whether CPA has adopted any policy which is not in the interest of the consumers?

SECRETARY FOR ECONOMIC SERVICES: Mr President,

  1. The China National Aviation Corporation (Hong Kong) Limited (CNAC(HK)) submitted an application for an Air Operator's Certificate (AOC) to the Civil Aviation Department (CAD) on 29 March 1995. Securing an AOC is a necessary prerequisite to operate Hong Kong registered aircraft for the purpose of public transport. An AOC may be granted if the Governor is satisfied that the applicant is competent, having regard in particular to his previous conduct and experience, his equipment, organization, staffing, maintenance and other arrangements to secure the safe operation of aircraft of the types specified in the certificate. CNAC(HK) has not yet submitted any documents in support of its application. CAD will give due consideration to the application when such documents are received.
    An application for an AOC is the first of several steps which a company has to go through before it will be able to mount scheduled air services with Hong Kong registered aircraft. In addition, the company will also have to apply for registration of its aircraft, obtain a licence for a specific route from the Air Transport Licensing Authority and seek designation by the Government for the route concerned. It is not government policy to invite any particular airline to make an application for any route; the airline concerned would have to apply and fulfill all the necessary requirements before it will be permitted to operate.
  2. At present, scheduled air services between Hong Kong and Taiwan are operated between Hong Kong and two cities in Taiwan, namely, Taipei and Kaohsiung. On the Hong Kong - Taipei route, the Cathay Pacific Airway's (CPA's) market share was 51.1% in the 12 months up to August 1995. On the Hong Kong - Kaohsiung route, CPA's market share was 53.8% in the same period.
    On both of the routes between Hong Kong and Taiwan, there is a choice for consumers. On the Hong Kong * Taipei route (which constitutes 82% of the total traffic between Hong Kong and Taiwan), six other airlines, apart from CPA, operate on the route. They are British Asia Airways, China Airlines, Japan Asia Airways, Singapore Airlines, Garuda Indonesia Airways, and Thai Airways International. On the Hong Kong * Kaohsiung route where traffic is only about 18% of the total traffic between Hong Kong and Taiwan, China Airlines operate on the route in addition to CPA.

Application and Approval of Search Warrants

15. MR CHIM PUI-CHUNG asked (in Chinese): In regard to applications for search warrants by government departments, will the Government inform this Council:

  1. of the criteria on which the court's approval of an application for search warrant file by a government department is based and whether there is any system to keep this power in check;
  2. whether the court or the department which files the application will be held responsible in the event that the application is subsequently proved to be at fault or ultra vires;
  3. of the time normally taken for obtaining a search warrant; and
  4. if members of the public have objections to be contents of an application for search warrant, to which department should they go to in order to raise their objection prior to the grant of the search warrant?

CHIEF SECRETARY: Mr President,

  1. In granting applications for search warrants, the court acts in accordance with the provisions in the relevant legislation under which the applications are made. The magistrate responsible will make sufficient enquiry to satisfy himself that there is reasonable cause to suspect that the items in respect of which the warrant is sought are on the premises to be searched. Such enquiry could include questioning the police officer requesting the search warrant under oath or affirmation or requiring the information in support of the warrant to be more precise.
    The power to grant warrants is discretionary. Therefore, a magistrate is not required to accede to an application for a search warrant even where the statutory requirements have been met. This together with the fact that a magistrate must refuse to grant a warrant if he is not satisfied that there is reasonable cause to suspect that the items in respect of which the warrant is sought are on the premises to be searched, serves to keep searches by government departments in check.
  2. Whether the court or the department which filed the application would be held responsible in the event that the application is subsequently proved to be at fault or ultra vires depends upon the circumstances in which the search warrant was issued. In general terms, a court could only be held responsible where it was established that it was acting maliciously and without reasonable and probable cause; and a government department could only be held responsible where it was established that it was acting maliciously.
  3. A department can normally obtain a search warrant from the court on the same day it files an application.
  4. An application for a search warrant is made ex parte, that is, only the party making the application is present. To inform the owner of the premises to be searched of the application would defeat the purpose of the search.

Air-tickets for Civil Servants on Duty Visits

16. MR CHEUNG MAN-KWONG asked (in Chinese): With regard to the purchase of air-tickets by the Government for civil servants on overseas duty visits and training, will the Government inform this Council:

  1. of its policy on purchasing such air-tickets;
  2. whether agreements have been made with any airlines for the purchase of air-tickets; if so, what are the details and why such agreements have been made;
  3. of the expenditure involved in purchasing such air-tickets during the past two years, together with a breakdown of the number of civil servants involved and their destinations;
  4. whether the Government has information to show that the adoption of its present policy on the purchase of such air-tickets, as compared with purchases made through travel agents or by other means, will result in a higher expenditure of public funds; if so, what are the reasons for continuing with the present policy; and
  5. whether consideration has been given to reviewing the present policy on the purchase of such air-tickets; if so, what are the details; if not, whether the Government will consider adopting other arrangements to purchase such air-tickets, such as placing orders with the airline purchase such air-tickets, such as placing orders with the airline charging the lowest fares or introducing other forms of competition?

SECRETARY FOR THE CIVIL SERVICE: Mr President, the answers to the questions raised are:

  1. The Government has an agreement with the British Airways (BA) and Cathay Pacific Airways (CPA) under which air-tickets (from any airlines) for civil servants on overseas duty visits have to be purchased through Jardine Airways (BA's general agent) or CPA. Air-tickets for civil servants on overseas training are not covered by the agreement, and can be purchased through any travel agent which accepts direct payment by the Treasury.
  2. The passage agreement with BA and CPA basically covers the Government's duty and school passages, but the Government may also make use of the contract fares for other passages to and from the United Kingdom. The main features of the agreement are:

    1. BA and CPA provide air-tickets at reduced fares on the Hong Kong - United Kingdom direct route (the United Kingdom route); and
    2. air-tickets on non-United Kingdom routes (from any airlines) have to be purchased through Jardine Airways or CAP.
      The Government entered into an agreement with the two airlines because the service required by the Government was and remains mainly passages on the Hong Kong - United Kingdom direct route ─ the bulk of which relate to school passages. Until 1994 only BA and CPA provided direct-route service to the United Kingdom. With the exception of Virgin Atlantic Airways (VAA) which started operating on the Hong Kong - United Kingdom direct route in 1994, the other airlines do not provide direct-flight service on the this route and therefore are unable to participate. We are discussing with BA and CPA the possibility of including the service of VAA in the current agreement.
    3. The expenditure involved in purchasing air-tickets for civil servants' overseas duty visits and training in 1993-94 and 1994-95 is $85.4 million, involving a total of 5 956 return passages. We have not kept specific records on the destinations of these passages.
    4. On the whole, we are getting a reasonable deal out of the agreement with BA and CPA as the Government is able to benefit from the reduced fares on the Hong Kong - United Kingdom direct flights with guaranteed bookings in both peak and off-peak seasons. The current arrangement for the purchase of air-tickets for civil servants' overseas duty visits and training, even if considered on its own, does not incur a much higher public expenditure, since the costs of published-fare air-tickets are roughly the same irrespective of from which agent they are bought. We are using published fares because the lower-fare air-tickets available in the market are very often special or promotional-fare tickets with usage restrictions attached, which would frequently not meet the operational requirements of these duty visits.
    5. With a view to achieving further savings, we are discussing with BA and CPA the possibility of including the service of VAA in the current agreement. We are also reviewing the scope of our being able to make use of the cheaper air fares available in the market for civil servants' overseas duty visits and training.

Green Island Public Dump Scheme

17. MR AMBROSE LAU asked (in Chinese): Now that the Government is consulting the public on the feasibility of the Green Island Public Dump Scheme and that the removal of Hong Kong International Airport has been scheduled for 1998, will the Government inform this Council whether consideration will be given to transporting construction waste on Hong Kong Island by land or by sea to the waters off the Airport and Kowloon Bay for dumping as an interim measure, as such a move will prepare that area for the future reclamation work on the one hand and allow more time for the public to study the policies relating to the Green Island reclamation on the other?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, the Territory Development Department has commissioned a feasibility study on the proposed future development of Kowloon Bay and the current Hong Kong International Airport. The study will examine, among other things, the possible sources of fill material, including construction waste, suitable for the proposed reclamation at Kowloon Bay. Findings of the study will help the Government in considering the viability of public dumping at Kowloon Bay and/ or the Airport. The study is scheduled to be completed in mid-1997. No decision will be made before the Government has examined the findings thoroughly.

Oxygen Content in Air

18. DR SAMUEL WONG asked: The proportion of oxygen in the air in some urban districts is sometimes found to be as low as 10%, although the normal oxygen content in the air is about 20%. In such circumstances, people will have to inhale more air, and hence more pollutants, than normal in order to get the oxygen required. In this connection, will the Government inform this Council whether:

  1. the Government will consider releasing the multiplication factor of pollution intake in each district due to lower oxygen content along with the pollution indices now published daily by the Environmental Protection Department; and
  2. if the answer to (a) above is in the negative, whether the Government will consider taking such factor into account in determining the pollution indices?

SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS: Mr President, the Air Pollution Index is designed to reflect the quality of outdoor air, of which the oxygen content is constantly at the normal level of 20%. In the outdoor environment, the carbon dioxide level in Hong Kong is well below 0.5% and variations around this level of concentration will not affect the oxygen content of the air. The issue of low oxygen in outdoor air is only relevant to locations at altitudes above 10 000 feet; but this is not relevant to Hong Kong. It is therefore not necessary for the Air Pollution Index to take into account the oxygen content. Hence, the answers to both (a) and (b) are in the negative.

Monitoring of H Share Companies

19. DR HUANG CHEN-YA asked (in Chinese): Will the Government inform this Council whether:

  1. the Securities and Futures Commission (SFC) will make a comparison between the profits predicted in the prospectuses of H share companies and the performance of these companies as published after the first year;
  2. the SFC has carried out investigations into companies which have recorded marked discrepancies between the predicted and actual profits; if so, what are the findings; and
  3. there are statutory provisions requiring merchant banks to be responsible for the accuracy of the information contained in prospectuses; if so, what are the liabilities of the merchant banks in the event that the particulars in the prospectuses are found to be incorrect, and what penalties will be imposed on them; if not, whether the Government will require merchant banks to assume responsibility, so as to reduce the chance of investors being misled?

SECRETARY FOR FINANCIAL SERVICES: Mr President,

(a) and (b)

    The Stock Exchange of Hong Kong (SEHK) is the frontline regulator responsible for the supervision of listed companies and the administration of all related matters. The SFC oversees the SEHK but is not directly involved in such matters.

    The SEHK reviews the performance of all newly listed companies, including H share companies, for the first accounting year after their listings, and compares that with the projected profits stated in the respective prospectus of the companies.

    All listed companies are required to sign a Listing Agreement and to abide by the SEHK Listing Rules. Under the Listing Agreement, a listed company is obliged to notify shareholders promptly of the occurrence of any event which could cause the forecast assumptions to be materially different from those stated in the prospectus and to indicate the likely impact of such event on the projected profits. The Listing Agreement also requires a company in such circumstances to include an explanation for such material difference in its directors' report and accounts.

    The SEHK monitors compliance with the Listing Rules and carries out inquiries where necessary. During the past three years, the SEHK has found two cases (one of which involves an H share company) where the actual results published in the directors* report and accounts differed materially from the projected profits stated in the relevant prospectus. In both cases, the company involved has issued a clarification statement to the public in accordance with the relevant Listing Rules.

  1. There are no statutory provisions which expressly impose special responsibilities on merchant banks for the accuracy of prospectuses. However, there are statutory provisions under which merchant banks could be exposed to criminal and civil liabilities in respect of untrue statements in prospectuses. Such liability is imposed on every person who has authorized the issue of the prospectus containing untrue statements. Coming within the wide class of persons who authorize the issue of the prospectus can be brokers, merchant banks, solicitors and others associated with the prospectus.
    Civil liability is created by section 40 of the Companies Ordinance (the Ordinance) in respect of Hong Kong companies, and section 342E of the Ordinance in respect of companies incorporated outside Hong Kong. The liability is to persons who subscribe for securities on the faith of a prospectus and sustain loss or damage by reason of any untrue statement contained therein.

    Criminal liability is created by section 40A of the Ordinance in respect of Hong Kong companies and section 342F of the Ordinance in respect of companies incorporated outside Hong Kong. If a prospectus contains a false statement, any person who authorized its issue will be guilty of an offence unless he can establish certain specific defences.

    The penalty for breaching section 40A or section 342F of the Ordinance is a fine of $500,000 or imprisonment for three years on indictment, and a fine of $100,000 and imprisonment of 12 months on summary charge.

    If a merchant bank acts as a sponsor in relation to a listing, it also has to comply with the Model Code for Sponsors of the Listing Rules. The Code requires that the sponsor should be closely involved in the preparation of the listing document and in ensuring that all material statements therein have been verified and that it complies with the Listing Rules and all relevant legislation. Failure by a sponsor to meet its obligations under the Listing Rules without reasonable excuse may render that person unacceptable to the SEHK for performing the role of a sponsor in the future.

ADDRESS

Ocean Park Corporation Annual Report 1994-95

MR RONALD ARCULLI

: Mr President, tabled before the Council today is the 1994-95 annual report of the Ocean Park Corporation.

In the financial year that ended on 30 June 1995, the Ocean Park enjoyed another year of record attendance with 3.3 million visitors to the Park, an increase of 5% on last year's record of 3.2 million.

The Ocean Park's revenue grew by 6% to HK$324 million. Operating income was HK$319 million. The net operating surplus for the financial year was HK$23 million, which compared with a net operating surplus of HK$53 million in the 1993-1994 financial year.

These results are most satisfactory given the difficulties encountered during the year. The higher attendance figure was pleasing given that Hong Kong experienced a series of severe tropical storms during the year which necessitated partial closure of the Park.

The number of overseas visitors to the Park fell by 9% mainly due to the drop in the number of tourists from China and Taiwan. Fortunately, more local residents visited the Park. The record number of visitors was largely due to improvements in the Ocean Park and new attractions which opened during the year.

Three new attractions costing a total of HK$58 million were opened in time for the Christmas-New Year holidays. On the Headland, we opened the 100-foot tall Ferris Wheel which provides spectacular views 400 feet above the South China Sea. We also opened the Eagle Ride which proved extremely popular. However, it is currently closed while modifications are made and tested. We plan to have the ride fully operational early next year. On the Lowland, we opened the Dinosaur Discovery Trail which, with its lifelike models and animatronic robots, proved an instant success with the public.

The largest influx of visitors came during the spring in response to the re-opening of the Atoll Reef. The Atoll Reef has traditionally been the Park's most popular attraction. The Reef has undergone a HK$65 million refurbishment and is now the largest reef aquarium in the world.

During its first full year of operation, the Ocean Park Conservation Foundation announced a five-year plan involving 16 whale and dolphin projects which include identification of conservation problems, development and executive of action plans, and long-term research to direct and support future marine mammal conservation efforts in the region.

The Foundation also convened the first meeting of the Asian River Dolphin Committee. Scientists from nine countries, including China, and representatives of the IUCN Cetaccan Specialist Group and The Whale and Dolphin Conservation Society met to discuss strategies for protecting threatened marine mammals.

The Ocean Park has an on-going commitment to improve access to the Park's facilities for Hong Kong's disabled residents. This year, new facilities for the disabled included contour models for mechanical rides, tactile maps and guide books for the visually impaired, improved access for wheelchair-bound visitors and the installation of a special gondola for disabled visitors on the new Ferris Wheel.

While the recent difficulties experienced at the Park fall outside this financial year, it would be remiss of me not to congratulate the management and staff on the way they handled the consequences of the tragic Aberdeen landslide.

Through their work, the comfort and safety of both visitors and of the Park's marine mammals, fish and animals were assured, and the Park was able to return to normal operations in a speedy manner. Above all, we owe special thanks also to the Government Flying Service, the Fire Services Department and the Electrical and Mechanical Services Department.

Looking to the future, our long-term development plan is to continue to expand and to better serve the needs of all age groups and interests within the community. In the next year, we expect to have further improvements and add new attractions including the opening of a Mine Train roller coaster and a high-tech simulator ride.

After a year that was both rewarding and eventful, the Ocean Park will continue to work to fulfill its mission to provide a balanced mix of recreation, education and conservation. I believe the Ocean Park is well set to achieve even higher levels of popularity and success.

Thank you, Mr President.

MOTIONS

EMPLOYEES' COMPENSATION ORDINANCE

THE SECRETARY FOR EDUCATION AND MANPOWER to move the following motion:

    "That, with effect from 1 January 1996, the Employees' Compensation Ordinance be amended as follows -
  1. in section 6 -
    1. in subsection (1)(a), (b) and (c), by repealing "$15,000" and substituting "$18,000";
    2. in subsection (2), by repealing "$219,000" and substituting "$262,000";
    3. in subsection (5), by repealing "$12,000" and substituting "$14,000";
  2. in section 7 -
    1. in subsection (1)(a), (b) and (c), by repealing "$15,000" and substituting "$18,000";
    2. in subsection (2), by repealing "$248,000" and substituting "$297,000";
  3. in section 8(1)(a) and (b), by repealing "$297,000" and substituting "$356,000";
  4. in section 11(5), by repealing "2,250" where it twice appears and substituting "2,450";
  5. in section 16A(10) -
    1. in paragraph (a), by repealing "$350" and substituting "$420";
    2. in paragraph (b), by repealing "$700" and substituting "$840";
  6. in section 17A(1) -
    1. in paragraph (a), by repealing "$350" and substituting "$420";
    2. in paragraph (b), by repealing "$700" and substituting "$840";
  7. in section 36C, by repealing "$24,000" and substituting "$28,000";
  8. in section 36J, by repealing "$74,000" and substituting "$86,000";
    1. in paragraphs 1(b), 2(b) and 3 of the Third Schedule, by repealing "$120" and substituting "$160"."

He said (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

The purpose of this resolution is to revise the levels of compensation and certain compensation-related items under the Employees' Compensation Ordinance. The Ordinance provides for payment of compensation by employers to employees who are injured or killed as a result of employment-related accidents. Our policy since 1978 has been to review the levels of compensation every two years to take account of wage movements, inflation and other changes. The existing levels of compensation have been in force since 1 January 1994 and are now due for revision. We propose that the revised rates should take effect as from 1 January 1996.

We propose to increase the ceiling for monthly earnings from $15,000 to $18,000. This figure is the basis on which the maximum amounts of compensation for permanent total incapacity and for death are calculated under the Ordinance. We also propose to increase the minimum levels of compensation for death from $219,000 to $262,000, and for permanent total incapacity from $248,000 to $297,000. In addition, we propose that the maximum amount of compensation for the costs of care required by another person be revised from $297,000 to $356,000. For late payment of compensation, we propose to increase the minimum amount of surcharge imposed upon expiry of the payment period from $350 to $420 and the minimum additional surcharge imposed three months after expiry of payment period from $700 to $840. Each of these six proposed revisions represents an increase of about 19.7% over the existing levels, which is in line with the increase in nominal wages during the past two years.

The ceilings on three other forms of compensation are to be adjusted to take account of inflation since their last revision in 1994. The proposed changes include increasing the maximum amount for burial expenses from $12,000 to $14,000, and increasing the maximum payments to be made by an employer towards the costs of supplying and fitting a prosthesis or a surgical appliance from $24,000 and $74,000 respectively to $28,000 and $86,000 respectively.

We also propose to raise the maximum daily rate of reimbursement of medical expenses from $120 to $160 to take account of the increase in fees charges by public hospitals and clinics since 1994.

Finally, we propose to revise the amount that is deemed to be the minimum earnings per month for the purpose of calculating compensation from $2,250 to $2,450. This proposed increase serves to keep the deemed minimum earnings of an injured employee broadly in line with the existing rate of payment to a singleton under the Comprehensive Social Security Assistance Scheme.

These proposals have been endorsed by the Labour Advisory Board and I recommend them to this Council for approval.

Mr President, I beg to move.

Question on the motion proposed.

MR LAU CHIN-SHEK (in Cantonese): Mr President, I certainly support today's motion which seeks to increase the rate of compensation for workers who were injured or even killed in the course of their work. However, I would also like to take this opportunity to state again what I think are the shortcomings of the present Employees' Compensation Ordinance, hoping that the Government will review the whole system of workers' compensation as soon as possible.

The legislation currently in force has stipulated various ceilings for calculating the rate of compensation for workers who have permanently lost the ability to work in the course of their work and has made it impossible for workers to obtain the compensation that they deserve. First, concerning the calculation of the monthly wage ceiling. Although today's motion seeks to increase the monthly wage ceiling from $15,000 to $18,000, that is still an unreasonable restriction, especially in the construction sector in which workers suffer serious injuries. For the many steel fixers, scaffold erectors and the majority of other professionals who may be earning a monthly wage exceeding $18,000, the present legislation has undoubtedly deprived them of the compensation that they deserve. Therefore the Government should consider abolishing the monthly wage ceiling. In fact, the present monthly wage ceiling for the calculation of severance pay and long service payment has already been increased to $22,500, but that for the calculation of workers' compensation is only to be increased to $18,000. This is obviously an unfair treatment to workers claiming workers' compensation.

Second, concerning the upper limit of the amount of compensation. According to the Employees' Compensation Ordinance, the maximum amount of compensation which workers can claim of the basis of injury or death sustained in the course of work is equivalent to seven years or eight years of their total income respectively. These ceilings, which have been set without and objective criteria, are particularly unfair to young workers seeking workers' compensation. For instance, a 17-year-old summer job worker was killed in an accident involving a hoist in North Point in June 1993. According to the law, he could only obtain compensation equivalent to eight years of his total wage and deductions had to be made according to the family's reliance on him. As a result, this worker's family could only obtain compensation amounting to $100,000 plus. Do you think that is fair? Human life is invaluable and the law which has imposed various restrictions on workers' compensation should absolutely be reviewed and improved. The Government may think that workers claiming workers' compensation can try to obtain more by suing their employers for negligence through civil proceedings. However, legal proceedings not only involve many problems of evidence, they are also very time-consuming; and a law suit will normally drag on for three to five years. That is undoubtedly unfair to the injured workers and their families. Therefore, I think a comprehensive review on the Employees' Compensation Ordinance should be conducted without delay so as to strengthen the protection given to workers claiming workers' compensation. Of course, what is more important is to improve industrial safety in Hong Kong so as to prevent the occurrence of accidents.

Mr President, with these remarks, I hope the Secretary for Education and Manpower can clearly respond to my demands in his concluding speech later on. Thank you.

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, I would like to thank the Honourable LAU Chin-shek for his speech as well as his support for this motion. I have listened very carefully to the views expressed by Mr LAU on some items. The Government will consider these views in detail in the next review. There is no doubt that we will fully consider the views of both the employers and employees with regard to this Ordinance in every review.

Thank you, Mr President.

Question on the motion put and agreed to.

PNEUMOCONIOSIS (COMPENSATION) ORDINANCE

THE SECRETARY FOR EDUCATION AND MANPOWER to move the following motion:

    "That, with effect from 1 January 1996, the Pneumoconiosis (Compensation) Ordinance be amended as follows -
  1. in the First Schedule -
    1. in paragraph 1 of Part II, by repealing "$2,100" and substituting "$2,570";
    2. in Part IV, by repealing "$3,500" and substituting "$4,050";
    3. in Part VI, by repealing "$12,000" and substituting "$14,000";
  2. in the Second Schedule, in paragraphs 1(b), 2(b) and 3 of Part I, by repealing "$120" and substituting $160".

He said (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

The purpose of this resolution is to revise the levels of compensation and certain compensation-related items under the Pneumoconiosis (Compensation) Ordinance. The Ordinance provides for payment of compensation for persons who were diagnosed after 1 January 1981 to be suffering from pneumoconiosis. We propose that the revised rates should take effect as from 1 January 1996.

We propose to raise the ceilings in respect of two items of compensation under the Ordinance to take account of inflation and wage movements since July 1993. First, we propose to increase the amount for calculating the monthly compensation for total incapacity, from $2,100 to $2,570. In this respect, it should be noted that under the Pneumoconiosis (Compensation) (Amendment) Bill which was introduced into this Council on 6 December 1995 (that is last Wednesday), the amount of $2,100 was proposed to be made a separate compensation item for pain, suffering and loss of amenities which would be paid to all eligible pneumoconiotics regardless of their degree of incapacity. Therefore, if this proposed revision is approved, we will move a Committee Stage Amendment to the Bill to revise the amount to $2,570. Secondly, we prepare to increase the amount of compensation for care and attention from $3,500 to $4,050.

Separately, we also propose to revise the rates of funeral expenses and medical expenses payable under the Ordinance which have always been identical to those specified in the Employees' Compensation Ordinance. As the rates of such expenses under the Employees' Compensation Ordinance have just been raised by a resolution of this Council, I propose that the levels of these two items be similarly revised.

The proposed have been endorsed by the Labour Advisory board and I recommend them to this Council for approval.

Mr President, I beg to move.

Question on the motion proposed, put and agreed to.

STAMP DUTY ORDINANCE

THE SECRETARY FOR THE TREASURY to move the following motion:

    "That section 29I(1) of the Stamp Duty Ordinance be amended by repealing "31 December 1995" and substituting "31 December 1997"."

He said (in Cantonese): Mr President, I move the resolution standing in my name on the Order Paper.

I would like to first outline the background. In January 1992, Members approved amendments to the Stamp Duty Ordinance (Cap. 117). Among other things, these amendments required stamp duty to be paid on all agreements for sale of residential property. By contrast, stamp duty was previously only payable on the assignment of the property.

This measure was one of a series of actions to curb speculation in residential property. It is a disincentive to those who speculate on property in the period between the conclusion of a sale agreement and the assignment. Apart from the additional stamp duty a speculator has to pay for each sale before assignment, the speculator also has a potential profits tax liability. The information on sale agreements provided to the Commissioner of Inland Revenue under the measure enables him to identify property transactions which may be liable to profits tax. This ensures that the speculators pay a fair share of profits tax. The cost of speculation has therefore been significantly increased. Genuine home-buyers are not affected by this measure except insofar as they have to pay stamp duty slightly earlier.

Under the terms of the original amendments, the measure would have expired at midnight on 31 December 1993. The intention was to allow both the administration and Members the opportunity to examine all relevant factors before deciding whether the measure should be extended. On 15 December 1993, Members approved a resolution to extended the measure for two years until 31 December 1995.

The residential property market has gradually softened. The problem of speculation has now been largely contained. This is the combined effect of measures proposed by the Inter-departmental Task Force on Land Supply and Property Prices, mortgage lending policy of banks, changes in interest rates, as well as the increased cost of speculation as a result of the stamp duty measure. It is therefore important that the stamp duty measure be extended. Otherwise, it would send a wrong signal to the market that the Government no longer wished to curb speculation in residential property. There would also be a significant risk that speculation may be rekindled to the detriment of genuine home-buyers.

The motion before Members today seeks the extension of the measure by a further period of two years beyond 31 December 1995. I am grateful that the Legislative Council Subcommittee formed to study the motion supports the extension of the measure in principle though I understand that there are different views in respect of the period of extension, that is whether the measure should be extended for one year or two years.

It is clear that the measure is effective in containing speculation. It does not affect genuine home-buyers. It has been in place for nearly four years and is well established and accepted by the public. I therefore do not see any reason why we should deviate from our previous practice of extending the measure for two years which may otherwise give a wrong signal to the market in respect of this Council's determination in containing speculation. In fact, we have also informed the Subcommittee that it is our plan to seek the views of Members later on in this session with a view to introducing an amendment to the Stamp Duty Ordinance to make the measure permanent. This will eliminate unnecessary speculation which may otherwise occur each time the expiry date of the measure approaches. The proposed two-year extension would allow Members sufficient time to study the permanent arrangement proposal. However, if the measure were to be extended for one year only and the amendment to the Stamp Duty Ordinance to make the measure permanent could not be processed in time, we might have to seek an extension again before the end of next year, thereby adding an unnecessary burden to the heavy agenda of this Council. I therefore strongly recommend to Members that the two-year extension should be supported.

Finally, I am also grateful to the Members of the Subcommittee for their views on how we should revise the stamp duty system in order to alleviate the financial burden of genuine home-buyers and to safeguard against abuse. I can assure Members that we will examine these views carefully before we submit the permanent arrangement proposal to this Council.

Mr President, I beg to move.

Question on the motion proposed.

PRESIDENT: Mr Ronald ARCULLI has given notice to move an amendment to the motion. His amendment has been printed on the Order Paper and circularized to Members. I propose to call on him to speak and to move his amendment now so that Members may debate the motion and the amendment together.

MR RONALD ARCULLI's amendment to the SECRETARY FOR THE TREASURY's motion:

    "To delete "31 December 1997" and to substitute "31 December 1996"."

MR RONALD ARCULLI:Mr President, I move that the Secretary for the Treasury's motion be amended as set out under my name in the Order Paper. A Subcommittee of 12 Members was formed on 20 October 1995 to study the resolution. I was elected Chairman of the Subcommittee. The Subcommittee held two meetings with the Administration, and I shall highlight two issues which were of concern to the Subcommittee.

The first concern was about the effectiveness of the stamp duty measure and its continued usefulness. While some Members of the Subcommittee agreed with the Administration that the measure could help stabilize the residential price, other Members were not as certain and pointed out that the price of other properties had also been stabilized even though they were not the subject of the same measure. Some Members also cast doubts on the continued usefulness of this measure in the light of the already softened property market and the need to stimulate the local economy.

The second concern was whether the ultimate objective of the measure was to raise revenue or to curb speculation on the residential property market. The Administration told the Subcommittee that the measure had been introduced with the principal aim of helping to curb speculation, although it had also achieved two other equitable results, which were the stamp duty payable on the sale and purchase agreement and that the Commissioner of Inland Revenue could more readily identify property transactions liable to profits tax.

The Administration acknowledged that at the time of introducing the measure, anti-speculation had been the prime factor, but in seeking its extension in the present exercise both factors were important and it was not possible to say which had a greater weight. On this particular point, my own view is that the Administration has in fact changed the stamp duty system, which has since the very beginning charged stamp duty on assignments of residential property. I cannot accept such change for the reasons of raising revenue.

The majority view of the Subcommittee was to support the Administration in seeking an extension of time on the stamp duty measure in principal, yet Members indicated they would have to make an assessment about the impact of the stamp duty measure on the local economic climate before they could decide whether the extension should be for one year, to cover until 31 December 1996, or two years until 31 December 1997.

On 6 December 1995, Mr President, I submitted an amendment to the Administration's resolution, the effect of which is to extend the operation of the relevant section to 31 December 1996 rather than 31 December 1997. I shall set out my reasons for moving such an amendment. Property speculation in the current economic climate is virtually non-existent. Indeed, it can be said that the stamp duty and other measures have achieved their objective some time ago. It must be clear to all of us that steps need to be taken to stimulate the economy and one such step would be the removal of the stamp duty measure. At the very least, the situation should be reviewed after a shorter interval than that proposed by the Administration.

It has often been said that the Hang Seng Index and the property market act as a barometer of our confidence in Hong Kong, and we know that both are substantially below their peaks. Therefore, it cannot be objectionable to extend the stamp duty measure for one year only. I doubt very much whether the Administration will find it necessary to extend its operation for another year, but if it is, the Administration will of course be at liberty to table another resolution at the appropriate time. For now, however, I urge Members to support my amendment so that the existing measure will only be extended until 31 December 1996.

In conclusion, Mr President, I urge Members to give serious consideration to the Administration's stated desire to continue receiving the extra revenue from this so-called anti-speculation measure. The Administration does not need this Council's help to raise surplus revenue. Ultimately, the cost of any extra stamp duty will find its way into the pockets of end-users who will pay for it.

When the Secretary for the Treasury, Mr President, mentioned the two-year extension, the thought just dawned on me as to how many of us will be here in two years' time, so I would urge Members to support my motion so that the control of this measure will remain with Members of this Council.

Mr President, with these remarks, I move that the Secretary for the Treasury's motion be amended as set out in the Order Paper.

Question on the amendment proposed.

MR LEE WING-TAT (in Cantonese): Mr President, the Democratic Party believes that collecting stamp duty on sale and purchase agreements of residential property is an effective measure to curb speculation. That is because suppose two or more sale and purchase agreements have been entered into before the actual assignment of a residential property, stamp duty will be payable for each and every agreement. This measure will increase the costs of speculators without affecting the real users.

At present, property prices have fallen by about 30% compared with those in April 1994 and October 1995, but they are still not affordable by the general public. According to information contained in the Government's written reply given to me last week, in 1985, an ordinary Hong Kong citizen could buy a flat of 500 sq ft in the urban area with only an amount equivalent to 120 times the median monthly wage. Now in 1995, however, the same worker will have to pay an amount equivalent to 190 times the median monthly wage to buy the same flat. Therefore, Mr President, although property prices have apparently fallen, it is only a slight fall from a very high peak and they are still not affordable by the general public, especially the grassroots. In October 1995, about 10% of all property assignments were still short-term assignments. This percentage is only slightly lower than that of what we call the peak which is 22%. Therefore, speculation has not completely disappeared, it has only dampened slightly. Short-term assignments amounting to 22% is certainly an indicator of a lot of speculation at the time, but 10% is still a significant figure.

If anti-speculation measures are immediately relaxed just when there is a fall in property prices, suppressed speculative activities will easily become active again and the ultimate victims will be the real users. Moreover, now that property prices have only fallen slightly, property developers are already feeling anxious and, with the help of our Financial Secretary, they have spread the news that property prices have hit the bottom and promoted the opinion that they will rise again very soon. Many associations of property developers have continuously lobbied the Government to relax the mortgage restrictions. Therefore, now that property prices have fallen, we have to take steps to stabilize the situation. If not, there will be an upsurge of property prices once the anti-speculation measures are relaxed.

If we extend measure to collect stamp duty on sale and purchase agreements of residential property for only a year, then a year later, before the falling trend of property prices has stabilized, speculators will have the chance to enter the market and there will be a revival of speculation. In addition, there will still be a shortage of private housing units in the next two years and less land will be available for urban redevelopment. Relaxing the anti-speculation measure in the face of reduced supply will only lead to an upsurge in property prices.

Therefore, Mr President, we do not agree with the Honourable Ronald ARCULLI's amendment and we will support the Government's motion. Thank you, Mr President.

MR CHAN KAM-LAM (in Cantonese): Mr President, up till now, the Stamp Duty Ordinance has really been effective in curbing property speculation and, therefore, the Democratic Alliance for the Betterment of Hong Kong supports the Secretary for the Treasury's motion to extend the measure to 31 December 1997. Besides, we would also urge the Government to review the present system of stamp duty as soon as possible so that, with the extra revenue obtained under the present system, tax concessions can be given to the real users in the community and the public can be encouraged to own their homes. Thank you, Mr President.

MR EDWARD HO (in Cantonese): Mr President, I remember that in the year in which the stamp duty measure was passed into law, I was Chairman of the Select Committee concerned. At that time, the Government made it clear that the measure was intended to curb property speculation. However, it seems that it has now become one of the Government's ways to grab revenue. Why do I say that?

The Honourable LEE Wing-tat talked about the question of property prices. The present level of property prices is certainly higher than that of 1985 and it is very much higher than that of 1967. There is no need for us to argue what is the level which we would consider it wrong to allow property prices to reach. However, we should be clear that it would not be possible to speculate on new flats at all. That is because with the implementation of the new measure, a flat cannot be sold earlier than nine months before the occupation permit is due to be issued and, after purchase, it cannot be assigned until the occupation permit has been obtained. Therefore, it would not be possible to speculate on new flats. Now, the subject for discussion is the speculation of old domestic units. Would it be possible to speculate on old domestic units? What does "speculation" mean? Speculation means trying to make a profit by means of assignment with very little money, that is, before all the money and costs have been paid. However, to purchase an old domestic unit, the price has to be paid in full, which means it would not be possible to speculate and we also know clearly that there are no speculative activities on property in the market. If we support the Government's motion to extend the measure for two years, we would be supporting the Government to grab revenue by using this method. It is not a question of curbing speculation. Thank you, Mr President.

MR JAMES TO (in Cantonese): Mr President, I would like to briefly respond to the Honourable Edward HO's viewpoints. In fact, I agree that it would not be possible to speculate on new flats. If there are restrictions forbidding any assignment of uncompleted flats before the occupation permit is issued, the question of how many times a new flat can be assigned between the time that a purchase agreement has been signed and the final stage when the assignment is entered into simply does not exit. Here the question is: Would it be possible to speculate on old domestic units.

When purchasing an old domestic unit, one does not necessarily have to pay the price in full because theoretically, the deposit can be set, for instance, at 10% or 20% of the price and then the agreement can be signed. If no stamp duty is payable at this stage, the purchaser and the vendor can decide on a transaction date in the more distant future. Experience shows that speculation does occur in this interim period and a unit can be assigned several times before occupation or before the assignment is entered into.

This measure will not affect the real users adversely. I believe we will agree that this is true if we really want to help the real users, no matter to which political party we belong; unless my honourable colleagues can provide any evidence that this measure will affect the real users adversely, then that will be a different matter. In fact, whether tax concessions and deductions of mortgage interests payable should be allowed and whether the amount and percentage of mortgage loan should be increased will be practical and useful measures for us to discuss now. I believe this measure will not be used to grab revenue, but even if it will, it will only be used to grab revenue from the property speculators and potential speculators, not from the users. Actually, even if this measure does not exist, stamp duty is payable anyway at the final stage when the assignment is entered into.

MRS SELINA CHOW (in Cantonese): Mr President, earlier on, I heard the Honourable James TO mention "theoretically" and, very often, we hear colleagues from the Democratic Party say "theoretically"; I think that is not the way we should consider problems.

In fact, it is not easy to differentiate clearly who are the buyers and who are the users. We have to consider clearly not only the effect of a measure on the buyers, the users or the speculators, but also the effect on the property market as a whole. Earlier on, we heard the Honourable LEE Wing-tat's speech and there is nothing much to it. Basically, he thinks that the property prices at present are not low enough; they should fall even lower and it would be best if they were reduced by half or even more. He only cares for those who want to buy their own flat, but neglects those who have already done so and have lost a fortune because they may have used up all their assets to pay for the deposit.

I believe we are not relaxing the measure. The question is: the Government said that this measure was introduced because there was a problem and that this was a temporary measure to cool off the over-heated property market. If it is temporary, then it should not be extended arbitrarily for two years, for two more years and yet two more years so that it would become a permanent measure to intervene in the market until the price reaches a level which is considered to be acceptable by some. This is not the way in which this measure should work. I am only hoping that we can understand that we are actually intervening in the market. Do we want to adopt this approach as a long-term policy? Alternatively, we can continue to give the market the message that this is actually a temporary measure: when there is a serious problem, certain measures have to be adopted; when the problem is less serious, we do not wish to intervene.

Thank you, Mr President.

MR ALBERT HO (in Cantonese): Mr President, I would like to make only a very short response. First, what is "property speculation"? To put it very simply, it means purchasing a property with a very small outlay and trying to assign it within a certain period of time after a wait-and-see period (there is already an intention of assignment at the time of purchase).

What is the method commonly used? Earlier on, the Honourable James TO has said that after the purchasers have paid the deposit, they would speculate on property by means of assignment. That was the case with the purchase of uncompleted flats in the past and that is still the method used in the speculation of old domestic units. That is not a theoretical situation. As a solicitor who has practised for more than 10 years, I have seen many people doing it. Now, with the introduction of the stamp duty measure, the assignee has to pay the stamp duty for every assignment. I think this is an effective measure to curb speculation and its effectiveness has also been generally acknowledged. Although this measure is still inadequate, the question, as the Honourable Mrs Selina CHOW suggested, is : What will be the result if this measure is cancelled?

Earlier on, Mrs CHOW has mentioned that many people have lost a lot of money as a result of the suppression of property prices and it is hoped that property prices will rise again. I hope that is not what Mrs CHOW meant. I really hope that that is not what she meant. However, we have to be very clear that this is only a temporary measure, though I do not think it will cause any unfairness. We have to emphasize time and again that at present, it is the assignee who has to pay the stamp duty. In fact, it is only fair that stamp duty is payable on every assignment of property rights. Therefore, when the Secretary for the Treasury said that a long-term review has to be carried out, I think that is a good thing. However, in the meantime, we have to spend time to review the situation and we must not give people a wrong message. We will certainly not agree should this be a measure to intervene in the market; but this is in fact a measure to increase the costs of property speculators and a way to obtain money and revenue for the Inland Revenue Department through what we think is a reasonable approach. I do not see any disadvantage and it has not created an unfair situation.

Mr President, I would like to emphasize one last point. Relying on the levy of stamp duty to curb property speculation and to stabilize property prices is not enough, good co-ordination and continued efforts by the Government are also necessary. We certainly do not agree to take any steps at this stage which would give other people a wrong message that the Government intends to relax the measure. Mr President, we support the Government's motion today in the hope that a review can be completed in two years' time so that we will know what steps should be taken in the long run. I therefore oppose the Honourable Ronald ARCULLI's amendment. Thank you.

MR ALLEN LEE (in Cantonese): Mr President, I would only like to point out that perhaps the Honourable Albert HO might have got it wrong; he used the word "cancel" just now but the Honourable Ronald ARCULLI has proposed to review, and not to cancel the measure, after a year. The use of the word "cancel" may mislead Members of this Council.

SECRETARY FOR THE TREASURY (in Cantonese): Mr President, although speculative activities in the property market have now slowed down, this does not mean that we can lower our guard. We must do our best to avoid sending any message which may make the market think that we would gradually relax or even cancel the measure related to stamp duty. In fact, with respect to property transactions which occur before or shortly after the signing of deeds of assignment, this is, cases of property re-sale, although the number has dropped from 16 023 cases in 1993 to 15 184 cases in 1994-95, 5 000 such cases were still recorded in the first six months of 1995-96. For that reason, we believe that there is a great need for the continued implementation of this particular measure. I do not accept the argument that cancelling the measure related to stamp duty can boost the economy. I believe that as far as property speculation is concerned, this will only reduce ......

PRESIDENT: Mr Allen LEE, do you have a point of order? Are you seeking elucidation?

MR ALLEN LEE: Yes.

PRESIDENT: Are you prepared to yield, Secretary for Treasury?

MR ALLEN LEE: The Secretary kept mentioning about cancelling. But Mr ARCULLI is not proposing cancelling. It is an extension to one year. So he has used the word three times already.

SECRETARY FOR THE TREASURY (in Cantonese): Mr President, perhaps the Member could not hear clearly what I just said. I said we should avoid giving any message that would make the market think there would be gradual relaxation or cancellation of this measure. I was only referring to the giving of a message. Allow me to continue with my speech.

I do not agree with the point that cancellation of the stamp duty measure can stimulate the economy. I think this will only cut the cost of the property speculators and indirectly encourage speculation activities on the property market. I have to emphasize that the measure on stamp duty is working well and it does not affect the genuine home buyers. The Honourable LEE Wing-tat has just explained the reason for this. In fact, if there are more speculation activities because of the cancellation of this measure, the cost of the genuine home buyers will be increased. Therefore, I hope Members will support the proposal to extend the stamp duty measure for two years.

Question on the amendment put.

Voice votes taken.

THE PRESIDENT said he thought the "Noes" had it.

Mr Ronald ARCULLI claimed a division.

PRESIDENT: Council shall proceed to a division.

PRESIDENT: I would like to remind Members that they are called upon to vote on the question that the amendment moved by Mr Ronald ARCULLI be made to the Secretary for the Treasury's motion.

PRESIDENT: Will Members please register their presence by pressing the top button in the voting units on their respective desks and then proceed to vote by selecting one of the three buttons below?

PRESIDENT: Before I declare the results, Members may wish to check their votes. Are there any queries? The result will now be displayed.

Mr Allen LEE, Mrs Selina CHOW, Mr NGAI Shiu-kit, Mr LAU Wong-fat, Mr Edward HO, Mr Ronald ARCULLI, Mrs Miriam LAU, Dr LEONG Che-hung, Mr CHIM Pui-chung, Mr Frederick FUNG, Mr Eric LI, Mr Howard YOUNG, Mr James TIEN, Mr Paul CHENG, Mr CHOY Kan-pui, Mr David CHU, Mr Ambrose LAU, Dr LAW Cheung-kwok, Mr Bruce LIU, Mr MOK Ying-fan and Miss Margaret NG voted for the amendment.

Mr Martin LEE, Mr SZETO Wah, Mr CHEUNG Man-kwong, Mr Michael HO, Dr HUANG Chen-ya, Miss Emily LAU, Mr LEE Wing-tat, Mr Fred LI, Mr James TO, Dr Samuel WONG, Dr Philip WONG, Dr YEUNG Sum, Mr WONG Wai-yin, Miss Christine LOH, Mr LEE Cheuk-yan, Mr CHAN Kam-lam, Miss CHAN Yuen-han, Mr Andrew CHENG, Mr CHENG Yiu-tong, Mr Anthony CHEUNG, Mr CHEUNG Hon-chung, Mr Albert HO, Mr IP Kwok-him, Mr LAU Chin-shek, Mr LAW Chi-kwong, Mr LEE Kai-ming, Mr LEUNG Yiu-chung, Mr NGAN Kam-chuen, Mr SIN Chung-kai, Mr TSANG Kin-shing, Dr John TSE, Mrs Elizabeth WONG and Mr YUM Sin-ling voted against the amendment.

THE PRESIDENT announced that there were 21 votes in favour of the amendment and 33 votes against it. He therefore declared that the amendment was negatived.

Question on the original motion put and agreed to.

MEMBER'S MOTIONS

INTERPRETATION AND GENERAL CLAUSES ORDINANCE

DR LEONG CHE-HUNG to move the following motion:

    "That in relation to the -
  1. Civil Aviation (Aircraft Noise) Ordinance (Amendment of Schedule) Notice 1995 published as Legal Notice No. 539 of 1995;
  2. Airport Authority Ordinance (71 of 1995) (Commencement) Notice 1995 published as Legal Notice No. 540 of 1995;
  3. Import (Radiation) (Prohibition) (Amendment) Regulation 1995 published as Legal Notice No. 541 of 1995;
  4. Import and Export (General) (Amendment) Regulation 1995 published as Legal Notice No. 542 of 1995;
  5. Import and Export (Fees) (Amendment) (No. 2) Regulation 1995 published as Legal Notice No. 543 of 1995;
  6. Import and Export (Registration) (Amendment) Regulation 1995 published as Legal Notice No. 544 of 1995;
  7. Ferry Services (Hongkong and Yaumati Ferry Company, Limited) (Determination of Fares) (Amendment) Ordinance 1995 published as Legal Notice No. 545 of 1995;
  8. Leveraged Foreign Exchange Trading (Calls) (Amendment) Rules 1995 published as Legal Notice No. 555 of 1995;
  9. Tax Reserve Certificates (Fourth Series) (Amendment) Rules 1995 published as Legal Notice No. 556 of 1995;
  10. Tax Reserve Certificates (Rate of Interest) Notice 1995 published as Legal Notice No. 557 of 1995;
  11. Prisoners' Education Trust Fund Ordinance (19 of 1995) (Commencement) Notice 1995 published as Legal Notice No. 558 of 1995;
  12. Official Languages (Amendment) Ordinance 1995 (51 of 1995) (Commencement) (No. 2) Notice 1995 published as Legal Notice No. 559 of 1995;
  13. Tax Reserve Certificates (Amendment) Ordinance 1995 (99 of 1995) (Commencement) Notice 1995 published as Legal Notice No. 560 of 1995;
  14. Official Languages (Authentic Chinese Text) (The Hongkong and Shanghai Banking Corporation Limited Ordinance) Order published as Legal Notice No. (C) 115 of 1995;
  15. Official Languages (Authentic Chinese Text) (Tramway Ordinance) Order published as Legal Notice No. (C) 116 of 1995; and
  16. Official Languages (Authentic Chinese Text) (Peak Tramway Ordinance) Order published as Legal Notice No. (C) 117 of 1995,

and laid on the table of the Legislative Council on 6 December 1995, the period referred to in section 34(2) of the Interpretation and General Clauses Ordinance for amending subsidiary legislation be extended under section 34(4) of that Ordinance until 10 January 1996."

DR LEONG CHE-HUNG: Mr President, I move the motion standing in my name on the Order Paper on behalf of the House. The motion seeks to extend the scrutiny period for the 16 items of subsidiary legislation tabled in the Council on 6 December 1995. As there is no sitting of the Legislative Council between 13 December 1995 to 10 January 1996, the deadline for Legislative Council intervention for these items of subsidiary legislation will fall on 3 January 1996 when there is no sitting.

In order to preserve Members' rights to amend any of these items, it is necessary to move an extension resolution to extend the period for intervention until 10 January 1996.

Mr President, I beg to move.

Question on the motion proposed, put and agreed to.

LEGISLATIVE COUNCIL (POWERS AND PRIVILEGES) ORDINANCE

MR LAU CHIN-SHEK

to move the following motion:

    "That for the purposes of enquiring into the circumstances surrounding the recent labour disputes involving imported workers under the Special Labour Importation Scheme for the Airport Core Programme Projects and related issues, the Legislative Council Panel on Manpower be authorized under section 9(2) of the Legislative Council (Powers and Privileges) Ordinance (Cap. 382) to exercise the powers conferred by section 9(1) of that Ordinance."

MR LAU CHIN-SHEK (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

Recently, labour disputes involving foreign workers of the airport projects have aroused much public concern, especially in relation to accusations of wage deductions and payment delays. In order to have an in-depth discussion of the matter, the Legislative Council Panel on Manpower held a special meeting on 5 December this year. Upon hearing the Administration's report on the labour disputes, the Panel was greatly shocked and disturbed about the unfair treatments received by the foreign workers. Although the Labour Department has stepped up its monitoring and enforcement efforts, the result is still disappointing. The Panel thinks that in order to assess the effectiveness of the new steps that have been taken or will be taken by the Government to protect the interests of foreign workers, it is necessary to understand the various arrangements for the importation of foreign labour, the role of the labour affairs companies and the extent of the contractors' responsibility. While the Government may conduct inquiries into individual cases on other aspects, the Panel thinks that it is necessary to conduct an in-depth inquiry in order to achieve the following aims:

  1. To understand the present procedures for the importation of labour and the circumstances under which wages are deducted and payments delayed;
  2. To assess whether the legislation enacted and the administrative measures adopted with a view to implementing and monitoring the Labour Importation Scheme are effective or not;
  3. To assess whether the new measures proposed by the Administration to control unlawful acts are effective or not;
  4. To put forth feasible means to strengthen the supervision, especially that of the Labour Importation Scheme; and
  5. To identify persons responsible for any unlawful acts.

In conducting this inquiry, the Panel on Manpower has to ask the parties concerned to provide evidence and relevant documents, but such parties may refuse to attend the inquiry or invoke the Legislation (Powers and Privileges) Ordinance for protection. In the circumstances, we have to ask this Council that the Panel be authorized under section 9(2) of the Legislative Council (Powers and Privileges) Ordinance to exercise the powers conferred by section 9(1) of the Ordinance. The Panel on Manpower, having submitted a report to the House Committee and obtained its support on 8 December, proposes the motion in this Council today. Now, I shall formally move the motion that the Legislative Council Panel on Manpower be authorized under section 9(2) of the Legislative Council (Powers and Privileges) Ordinance to exercise the powers conferred by section 9(1) of that Ordinance.

Mr President, with these remarks, I move the motion. Thank you.

Question on the motion proposed.

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, the recent outbreak of labour disputes on Airport Core Programme (ACP) work sites is a matter of serious concern to the Government. I should like to assure Members that a thorough investigation into each of the cases is being conducted. Hong Kong is a civilized society where the rule of law is paramount. We will not tolerate abuse of imported workers and will instigate prosecutions against those who may have breached the laws of Hong Kong. We fully appreciate Members' understandable concern about such cases and their desire to get to the truth to find out what went wrong and who is responsible. We share these sentiments entirely. However, it is not necessary nor appropriate for the Council to confer on the Manpower Panel the power under section 9 of the Legislative Council (Powers and Privileges) Ordinance to conduct an enquiry into the circumstances surrounding the labour disputes for the following reasons.

First, these labour disputes are already under investigation by the law enforcement agencies. The Labour Department has been making good progress in its investigations. In some of these cases, the investigations are at an advanced stage. Prosecutions relating to breaches under the Employment Ordinance are being considered in most of the disputes and hearings for the contractors and subcontractors involved have been arranged for this purpose. These hearings are an integral part of the due process which must be observed before taking a final decision on whether or not to lay charges. These investigation procedures are likely to be affected if the Manpower Panel of this Council is to conduct a parallel inquiry into the disputes. The use of the Legislative Council (Powers and Privileges) Ordinance whether to summon persons involved in the dispute or to ask for documents relating to the disputes will run the serious risk of delaying or jeopardizing our inquiries. I am sure Members would not wish to see this happen.

The Immigration Department is investigating into the various dispute cases to see if there are any offences under the Immigration Ordinance. The police are also at present investigating six constructions sites in connection with the recent labour disputes to ascertain whether any person has breached the law. Before these investigations are completed, any action taken by the Legislative Council to invoke the powers under the Legislative Council (Powers and Privileges) Ordinance to enquire into the circumstances of the cases may prejudice the outcome of such investigations. Any discrepancies in the statements and testimony of the same witnesses called by the police, the Immigration Department and the Panel, and the premature release of documents or evidence in connection with the cases possessed by the law enforcement agencies may impede the progress of our investigations and may adversely affect the chance of subsequent prosecutions.

Secondly, we have been in contact with the New China News Agency and are working with the relevant Chinese authorities with a view to improving communication and co-operation particularly in respect of the operation of and the legal charges imposed by the Chinese labour service companies to ensure that imported workers from PRC are aware of their rights and benefits, and to safeguard them from being exploited. I understand that the Chinese authorities have already set up a special team to investigate at their end the complaints about wage deductions. There is therefore no urgent need for this Council or the Manpower Panel to carry out an enquiry at this stage. Indeed, Members should await the outcome of the efforts by both Governments before deciding whether any further action is warranted.

As an open and accountable Government, we fully acknowledge that the public has the right to know more about the causes of and the results of our investigations into the current labour disputes. We have no intention of hiding the truth from members of the public. I intend to present to this Council in about three months' time a detailed report on the results of all our investigation efforts. This report will not only set out the outcome of investigations in Hong Kong, but will also include information about the role of the labour service companies and the result of our liaison efforts with the Chinese authorities. This will enable both Members and the general public to have a full picture of the problems involved, their causes, the effect of the various remedial measures we have recently taken and any further recommendations we may put forward to enhance the integrity of the system. Members will be given ample opportunity to discuss and raise questions on this report.

I personally led the team of officials and senior representatives of the Airport Authority (AA) and MTRC to answer questions on the ACP labour disputes at the Special Manpower Panel Meeting on 5 December 1995. My colleagues and I, including the authorities concerned, AA and MTRC, are very much prepared to continue to co-operate fully with the Manpower Panel without prejudice to our investigations. The exercise of the Legislative Council powers and privileges, if targeted at the Administration and the other institutions mentioned above, is absolutely unnecessary.

We have already provided information to the Manpower Panel on the nature of the recent labour disputes. I do not wish to repeat here. However I would like to reiterate that we have already added new conditions to strengthen our monitoring system to minimize the possibility of abuse of the scheme. With effect from 1 November 1995, employers are required to: (1) give a copy of employment contract to his imported workers; (2) provide them with details of their monthly earnings; (3) provide them with a monthly statement showing all transactions of their bank accounts. Within eight weeks upon the arrival of an imported worker in Hong Kong, the employer is required to grant him paid leave to enable him to attend briefings on his statutory rights as an employee under Hong Kong labour laws and his contractual rights under the employment contract. On top of these measures which are already in force, we intend to require employers to give an undertaking to the Labour Department that the imported workers have received a copy of the employment contract specifying the post and amount of wages before they come to Hong Kong. Officers of the Immigration Department will ask the imported worker to present his employment contract for inspection purpose shortly upon their arrival in Hong Kong.

I would like to assure this Council once again that we do not and will not tolerate any abuse of imported workers. We are committed to upholding the integrity of the ACP Labour Importation Scheme. Malpractices by a few threaten the good name of other law-abiding employers and the good name of Hong Kong. We are fully committed to do everything within our power to combat abuses and malpractices. Labour Inspectors of the Labour Department conduct regular inspections to the places of work of imported workers to check whether provisions under the Employment Ordinance and the Employees' Compensation Ordinance have been complied with and to guard against other abuses which constitute breaches of the conditions under the Scheme.

I would also like to make clear, once again, that without prejudice to any prosecutions under the laws of Hong Kong, employers who are found to have contravened conditions of the scheme will be liable to: (1) withdrawal of quotas in hand; (2) refusal of application for extension of stay of the employee upon expiry of visa; and (3) refusal of application to import labour under the ACP scheme in future.

To conclude, I would assure Members again that we have been proceeding with our investigations into the labour disputes and related problems as a priority task. We are making every effort to improve the effectiveness of the various controls and safeguards under the ACP Scheme. The whole process of our work is open and transparent. We will work closely with concerned Members of this Council, the Manpower Panel and other interested parties during this process. We are open and receptive to any suggestions and advice on how we can improve the operational and monitoring system of the Scheme.

We do not see a need at this stage for this Council to empower the Manpower Panel under section 9 of the Legislative Council (Powers and Privileges) Ordinance to conduct hearings and enquiries into these labour disputes. We are very concerned that this will run the risk of prejudicing the Government's investigation efforts and thus will not be in the interest of the workers or the community as a whole. I would therefore ask Members to consider this motion in the light of my comments and vote against it. In the event this motion is passed, I will urge Members of the Council and the Manpower Panel to await and examine the Administration's detailed investigation report which we will, I repeat, submit in about three months' time before considering whether or not to invoke the Legislative Council (Powers and Privileges) Ordinance to conduct hearings and enquiries.

Thank you.

Separately, we also propose to revise the rates of funeral expenses and medical expenses payable under the Ordinance which have always been identical to those specified in the Employees' Compensation Ordinance. As the rates of such expenses under the Employees' Compensation Ordinance have just been raised by a resolution of this Council, I propose that the levels of these two items be similarly revised.

The proposed have been endorsed by the Labour Advisory board and I recommend them to this Council for approval.

Mr President, I beg to move.

Question on the motion proposed, put and agreed to.

STAMP DUTY ORDINANCE

THE SECRETARY FOR THE TREASURY to move the following motion:

    "That section 29I(1) of the Stamp Duty Ordinance be amended by repealing "31 December 1995" and substituting "31 December 1997"."

He said (in Cantonese): Mr President, I move the resolution standing in my name on the Order Paper.

I would like to first outline the background. In January 1992, Members approved amendments to the Stamp Duty Ordinance (Cap. 117). Among other things, these amendments required stamp duty to be paid on all agreements for sale of residential property. By contrast, stamp duty was previously only payable on the assignment of the property.

This measure was one of a series of actions to curb speculation in residential property. It is a disincentive to those who speculate on property in the period between the conclusion of a sale agreement and the assignment. Apart from the additional stamp duty a speculator has to pay for each sale before assignment, the speculator also has a potential profits tax liability. The information on sale agreements provided to the Commissioner of Inland Revenue under the measure enables him to identify property transactions which may be liable to profits tax. This ensures that the speculators pay a fair share of profits tax. The cost of speculation has therefore been significantly increased. Genuine home-buyers are not affected by this measure except insofar as they have to pay stamp duty slightly earlier.

Under the terms of the original amendments, the measure would have expired at midnight on 31 December 1993. The intention was to allow both the administration and Members the opportunity to examine all relevant factors before deciding whether the measure should be extended. On 15 December 1993, Members approved a resolution to extended the measure for two years until 31 December 1995.

The residential property market has gradually softened. The problem of speculation has now been largely contained. This is the combined effect of measures proposed by the Inter-departmental Task Force on Land Supply and Property Prices, mortgage lending policy of banks, changes in interest rates, as well as the increased cost of speculation as a result of the stamp duty measure. It is therefore important that the stamp duty measure be extended. Otherwise, it would send a wrong signal to the market that the Government no longer wished to curb speculation in residential property. There would also be a significant risk that speculation may be rekindled to the detriment of genuine home-buyers.

The motion before Members today seeks the extension of the measure by a further period of two years beyond 31 December 1995. I am grateful that the Legislative Council Subcommittee formed to study the motion supports the extension of the measure in principle though I understand that there are different views in respect of the period of extension, that is whether the measure should be extended for one year or two years.

It is clear that the measure is effective in containing speculation. It does not affect genuine home-buyers. It has been in place for nearly four years and is well established and accepted by the public. I therefore do not see any reason why we should deviate from our previous practice of extending the measure for two years which may otherwise give a wrong signal to the market in respect of this Council's determination in containing speculation. In fact, we have also informed the Subcommittee that it is our plan to seek the views of Members later on in this session with a view to introducing an amendment to the Stamp Duty Ordinance to make the measure permanent. This will eliminate unnecessary speculation which may otherwise occur each time the expiry date of the measure approaches. The proposed two-year extension would allow Members sufficient time to study the permanent arrangement proposal. However, if the measure were to be extended for one year only and the amendment to the Stamp Duty Ordinance to make the measure permanent could not be processed in time, we might have to seek an extension again before the end of next year, thereby adding an unnecessary burden to the heavy agenda of this Council. I therefore strongly recommend to Members that the two-year extension should be supported.

Finally, I am also grateful to the Members of the Subcommittee for their views on how we should revise the stamp duty system in order to alleviate the financial burden of genuine home-buyers and to safeguard against abuse. I can assure Members that we will examine these views carefully before we submit the permanent arrangement proposal to this Council.

Mr President, I beg to move.

Question on the motion proposed.

PRESIDENT: Mr Ronald ARCULLI has given notice to move an amendment to the motion. His amendment has been printed on the Order Paper and circularized to Members. I propose to call on him to speak and to move his amendment now so that Members may debate the motion and the amendment together.

MR RONALD ARCULLI's amendment to the SECRETARY FOR THE TREASURY's motion:

    "To delete "31 December 1997" and to substitute "31 December 1996"."

MR RONALD ARCULLI:Mr President, I move that the Secretary for the Treasury's motion be amended as set out under my name in the Order Paper. A Subcommittee of 12 Members was formed on 20 October 1995 to study the resolution. I was elected Chairman of the Subcommittee. The Subcommittee held two meetings with the Administration, and I shall highlight two issues which were of concern to the Subcommittee.

The first concern was about the effectiveness of the stamp duty measure and its continued usefulness. While some Members of the Subcommittee agreed with the Administration that the measure could help stabilize the residential price, other Members were not as certain and pointed out that the price of other properties had also been stabilized even though they were not the subject of the same measure. Some Members also cast doubts on the continued usefulness of this measure in the light of the already softened property market and the need to stimulate the local economy.

The second concern was whether the ultimate objective of the measure was to raise revenue or to curb speculation on the residential property market. The Administration told the Subcommittee that the measure had been introduced with the principal aim of helping to curb speculation, although it had also achieved two other equitable results, which were the stamp duty payable on the sale and purchase agreement and that the Commissioner of Inland Revenue could more readily identify property transactions liable to profits tax.

The Administration acknowledged that at the time of introducing the measure, anti-speculation had been the prime factor, but in seeking its extension in the present exercise both factors were important and it was not possible to say which had a greater weight. On this particular point, my own view is that the Administration has in fact changed the stamp duty system, which has since the very beginning charged stamp duty on assignments of residential property. I cannot accept such change for the reasons of raising revenue.

The majority view of the Subcommittee was to support the Administration in seeking an extension of time on the stamp duty measure in principal, yet Members indicated they would have to make an assessment about the impact of the stamp duty measure on the local economic climate before they could decide whether the extension should be for one year, to cover until 31 December 1996, or two years until 31 December 1997.

On 6 December 1995, Mr President, I submitted an amendment to the Administration's resolution, the effect of which is to extend the operation of the relevant section to 31 December 1996 rather than 31 December 1997. I shall set out my reasons for moving such an amendment. Property speculation in the current economic climate is virtually non-existent. Indeed, it can be said that the stamp duty and other measures have achieved their objective some time ago. It must be clear to all of us that steps need to be taken to stimulate the economy and one such step would be the removal of the stamp duty measure. At the very least, the situation should be reviewed after a shorter interval than that proposed by the Administration.

It has often been said that the Hang Seng Index and the property market act as a barometer of our confidence in Hong Kong, and we know that both are substantially below their peaks. Therefore, it cannot be objectionable to extend the stamp duty measure for one year only. I doubt very much whether the Administration will find it necessary to extend its operation for another year, but if it is, the Administration will of course be at liberty to table another resolution at the appropriate time. For now, however, I urge Members to support my amendment so that the existing measure will only be extended until 31 December 1996.

In conclusion, Mr President, I urge Members to give serious consideration to the Administration's stated desire to continue receiving the extra revenue from this so-called anti-speculation measure. The Administration does not need this Council's help to raise surplus revenue. Ultimately, the cost of any extra stamp duty will find its way into the pockets of end-users who will pay for it.

When the Secretary for the Treasury, Mr President, mentioned the two-year extension, the thought just dawned on me as to how many of us will be here in two years' time, so I would urge Members to support my motion so that the control of this measure will remain with Members of this Council.

Mr President, with these remarks, I move that the Secretary for the Treasury's motion be amended as set out in the Order Paper.

Question on the amendment proposed.

MR LEE WING-TAT (in Cantonese): Mr President, the Democratic Party believes that collecting stamp duty on sale and purchase agreements of residential property is an effective measure to curb speculation. That is because suppose two or more sale and purchase agreements have been entered into before the actual assignment of a residential property, stamp duty will be payable for each and every agreement. This measure will increase the costs of speculators without affecting the real users.

At present, property prices have fallen by about 30% compared with those in April 1994 and October 1995, but they are still not affordable by the general public. According to information contained in the Government's written reply given to me last week, in 1985, an ordinary Hong Kong citizen could buy a flat of 500 sq ft in the urban area with only an amount equivalent to 120 times the median monthly wage. Now in 1995, however, the same worker will have to pay an amount equivalent to 190 times the median monthly wage to buy the same flat. Therefore, Mr President, although property prices have apparently fallen, it is only a slight fall from a very high peak and they are still not affordable by the general public, especially the grassroots. In October 1995, about 10% of all property assignments were still short-term assignments. This percentage is only slightly lower than that of what we call the peak which is 22%. Therefore, speculation has not completely disappeared, it has only dampened slightly. Short-term assignments amounting to 22% is certainly an indicator of a lot of speculation at the time, but 10% is still a significant figure.

If anti-speculation measures are immediately relaxed just when there is a fall in property prices, suppressed speculative activities will easily become active again and the ultimate victims will be the real users. Moreover, now that property prices have only fallen slightly, property developers are already feeling anxious and, with the help of our Financial Secretary, they have spread the news that property prices have hit the bottom and promoted the opinion that they will rise again very soon. Many associations of property developers have continuously lobbied the Government to relax the mortgage restrictions. Therefore, now that property prices have fallen, we have to take steps to stabilize the situation. If not, there will be an upsurge of property prices once the anti-speculation measures are relaxed.

If we extend measure to collect stamp duty on sale and purchase agreements of residential property for only a year, then a year later, before the falling trend of property prices has stabilized, speculators will have the chance to enter the market and there will be a revival of speculation. In addition, there will still be a shortage of private housing units in the next two years and less land will be available for urban redevelopment. Relaxing the anti-speculation measure in the face of reduced supply will only lead to an upsurge in property prices.

Therefore, Mr President, we do not agree with the Honourable Ronald ARCULLI's amendment and we will support the Government's motion. Thank you, Mr President.

MR CHAN KAM-LAM (in Cantonese): Mr President, up till now, the Stamp Duty Ordinance has really been effective in curbing property speculation and, therefore, the Democratic Alliance for the Betterment of Hong Kong supports the Secretary for the Treasury's motion to extend the measure to 31 December 1997. Besides, we would also urge the Government to review the present system of stamp duty as soon as possible so that, with the extra revenue obtained under the present system, tax concessions can be given to the real users in the community and the public can be encouraged to own their homes. Thank you, Mr President.

MR EDWARD HO (in Cantonese): Mr President, I remember that in the year in which the stamp duty measure was passed into law, I was Chairman of the Select Committee concerned. At that time, the Government made it clear that the measure was intended to curb property speculation. However, it seems that it has now become one of the Government's ways to grab revenue. Why do I say that?

The Honourable LEE Wing-tat talked about the question of property prices. The present level of property prices is certainly higher than that of 1985 and it is very much higher than that of 1967. There is no need for us to argue what is the level which we would consider it wrong to allow property prices to reach. However, we should be clear that it would not be possible to speculate on new flats at all. That is because with the implementation of the new measure, a flat cannot be sold earlier than nine months before the occupation permit is due to be issued and, after purchase, it cannot be assigned until the occupation permit has been obtained. Therefore, it would not be possible to speculate on new flats. Now, the subject for discussion is the speculation of old domestic units. Would it be possible to speculate on old domestic units? What does "speculation" mean? Speculation means trying to make a profit by means of assignment with very little money, that is, before all the money and costs have been paid. However, to purchase an old domestic unit, the price has to be paid in full, which means it would not be possible to speculate and we also know clearly that there are no speculative activities on property in the market. If we support the Government's motion to extend the measure for two years, we would be supporting the Government to grab revenue by using this method. It is not a question of curbing speculation. Thank you, Mr President.

MR JAMES TO (in Cantonese): Mr President, I would like to briefly respond to the Honourable Edward HO's viewpoints. In fact, I agree that it would not be possible to speculate on new flats. If there are restrictions forbidding any assignment of uncompleted flats before the occupation permit is issued, the question of how many times a new flat can be assigned between the time that a purchase agreement has been signed and the final stage when the assignment is entered into simply does not exit. Here the question is: Would it be possible to speculate on old domestic units.

When purchasing an old domestic unit, one does not necessarily have to pay the price in full because theoretically, the deposit can be set, for instance, at 10% or 20% of the price and then the agreement can be signed. If no stamp duty is payable at this stage, the purchaser and the vendor can decide on a transaction date in the more distant future. Experience shows that speculation does occur in this interim period and a unit can be assigned several times before occupation or before the assignment is entered into.

This measure will not affect the real users adversely. I believe we will agree that this is true if we really want to help the real users, no matter to which political party we belong; unless my honourable colleagues can provide any evidence that this measure will affect the real users adversely, then that will be a different matter. In fact, whether tax concessions and deductions of mortgage interests payable should be allowed and whether the amount and percentage of mortgage loan should be increased will be practical and useful measures for us to discuss now. I believe this measure will not be used to grab revenue, but even if it will, it will only be used to grab revenue from the property speculators and potential speculators, not from the users. Actually, even if this measure does not exist, stamp duty is payable anyway at the final stage when the assignment is entered into.

MRS SELINA CHOW (in Cantonese): Mr President, earlier on, I heard the Honourable James TO mention "theoretically" and, very often, we hear colleagues from the Democratic Party say "theoretically"; I think that is not the way we should consider problems.

In fact, it is not easy to differentiate clearly who are the buyers and who are the users. We have to consider clearly not only the effect of a measure on the buyers, the users or the speculators, but also the effect on the property market as a whole. Earlier on, we heard the Honourable LEE Wing-tat's speech and there is nothing much to it. Basically, he thinks that the property prices at present are not low enough; they should fall even lower and it would be best if they were reduced by half or even more. He only cares for those who want to buy their own flat, but neglects those who have already done so and have lost a fortune because they may have used up all their assets to pay for the deposit.

I believe we are not relaxing the measure. The question is: the Government said that this measure was introduced because there was a problem and that this was a temporary measure to cool off the over-heated property market. If it is temporary, then it should not be extended arbitrarily for two years, for two more years and yet two more years so that it would become a permanent measure to intervene in the market until the price reaches a level which is considered to be acceptable by some. This is not the way in which this measure should work. I am only hoping that we can understand that we are actually intervening in the market. Do we want to adopt this approach as a long-term policy? Alternatively, we can continue to give the market the message that this is actually a temporary measure: when there is a serious problem, certain measures have to be adopted; when the problem is less serious, we do not wish to intervene.

Thank you, Mr President.

MR ALBERT HO (in Cantonese): Mr President, I would like to make only a very short response. First, what is "property speculation"? To put it very simply, it means purchasing a property with a very small outlay and trying to assign it within a certain period of time after a wait-and-see period (there is already an intention of assignment at the time of purchase).

What is the method commonly used? Earlier on, the Honourable James TO has said that after the purchasers have paid the deposit, they would speculate on property by means of assignment. That was the case with the purchase of uncompleted flats in the past and that is still the method used in the speculation of old domestic units. That is not a theoretical situation. As a solicitor who has practised for more than 10 years, I have seen many people doing it. Now, with the introduction of the stamp duty measure, the assignee has to pay the stamp duty for every assignment. I think this is an effective measure to curb speculation and its effectiveness has also been generally acknowledged. Although this measure is still inadequate, the question, as the Honourable Mrs Selina CHOW suggested, is : What will be the result if this measure is cancelled?

Earlier on, Mrs CHOW has mentioned that many people have lost a lot of money as a result of the suppression of property prices and it is hoped that property prices will rise again. I hope that is not what Mrs CHOW meant. I really hope that that is not what she meant. However, we have to be very clear that this is only a temporary measure, though I do not think it will cause any unfairness. We have to emphasize time and again that at present, it is the assignee who has to pay the stamp duty. In fact, it is only fair that stamp duty is payable on every assignment of property rights. Therefore, when the Secretary for the Treasury said that a long-term review has to be carried out, I think that is a good thing. However, in the meantime, we have to spend time to review the situation and we must not give people a wrong message. We will certainly not agree should this be a measure to intervene in the market; but this is in fact a measure to increase the costs of property speculators and a way to obtain money and revenue for the Inland Revenue Department through what we think is a reasonable approach. I do not see any disadvantage and it has not created an unfair situation.

Mr President, I would like to emphasize one last point. Relying on the levy of stamp duty to curb property speculation and to stabilize property prices is not enough, good co-ordination and continued efforts by the Government are also necessary. We certainly do not agree to take any steps at this stage which would give other people a wrong message that the Government intends to relax the measure. Mr President, we support the Government's motion today in the hope that a review can be completed in two years' time so that we will know what steps should be taken in the long run. I therefore oppose the Honourable Ronald ARCULLI's amendment. Thank you.

MR ALLEN LEE (in Cantonese): Mr President, I would only like to point out that perhaps the Honourable Albert HO might have got it wrong; he used the word "cancel" just now but the Honourable Ronald ARCULLI has proposed to review, and not to cancel the measure, after a year. The use of the word "cancel" may mislead Members of this Council.

SECRETARY FOR THE TREASURY (in Cantonese): Mr President, although speculative activities in the property market have now slowed down, this does not mean that we can lower our guard. We must do our best to avoid sending any message which may make the market think that we would gradually relax or even cancel the measure related to stamp duty. In fact, with respect to property transactions which occur before or shortly after the signing of deeds of assignment, this is, cases of property re-sale, although the number has dropped from 16 023 cases in 1993 to 15 184 cases in 1994-95, 5 000 such cases were still recorded in the first six months of 1995-96. For that reason, we believe that there is a great need for the continued implementation of this particular measure. I do not accept the argument that cancelling the measure related to stamp duty can boost the economy. I believe that as far as property speculation is concerned, this will only reduce ......

PRESIDENT: Mr Allen LEE, do you have a point of order? Are you seeking elucidation?

MR ALLEN LEE: Yes.

PRESIDENT: Are you prepared to yield, Secretary for Treasury?

MR ALLEN LEE: The Secretary kept mentioning about cancelling. But Mr ARCULLI is not proposing cancelling. It is an extension to one year. So he has used the word three times already.

SECRETARY FOR THE TREASURY (in Cantonese): Mr President, perhaps the Member could not hear clearly what I just said. I said we should avoid giving any message that would make the market think there would be gradual relaxation or cancellation of this measure. I was only referring to the giving of a message. Allow me to continue with my speech.

I do not agree with the point that cancellation of the stamp duty measure can stimulate the economy. I think this will only cut the cost of the property speculators and indirectly encourage speculation activities on the property market. I have to emphasize that the measure on stamp duty is working well and it does not affect the genuine home buyers. The Honourable LEE Wing-tat has just explained the reason for this. In fact, if there are more speculation activities because of the cancellation of this measure, the cost of the genuine home buyers will be increased. Therefore, I hope Members will support the proposal to extend the stamp duty measure for two years.

Question on the amendment put.

Voice votes taken.

THE PRESIDENT said he thought the "Noes" had it.

Mr Ronald ARCULLI claimed a division.

PRESIDENT: Council shall proceed to a division.

PRESIDENT: I would like to remind Members that they are called upon to vote on the question that the amendment moved by Mr Ronald ARCULLI be made to the Secretary for the Treasury's motion.

PRESIDENT: Will Members please register their presence by pressing the top button in the voting units on their respective desks and then proceed to vote by selecting one of the three buttons below?

PRESIDENT: Before I declare the results, Members may wish to check their votes. Are there any queries? The result will now be displayed.

Mr Allen LEE, Mrs Selina CHOW, Mr NGAI Shiu-kit, Mr LAU Wong-fat, Mr Edward HO, Mr Ronald ARCULLI, Mrs Miriam LAU, Dr LEONG Che-hung, Mr CHIM Pui-chung, Mr Frederick FUNG, Mr Eric LI, Mr Howard YOUNG, Mr James TIEN, Mr Paul CHENG, Mr CHOY Kan-pui, Mr David CHU, Mr Ambrose LAU, Dr LAW Cheung-kwok, Mr Bruce LIU, Mr MOK Ying-fan and Miss Margaret NG voted for the amendment.

Mr Martin LEE, Mr SZETO Wah, Mr CHEUNG Man-kwong, Mr Michael HO, Dr HUANG Chen-ya, Miss Emily LAU, Mr LEE Wing-tat, Mr Fred LI, Mr James TO, Dr Samuel WONG, Dr Philip WONG, Dr YEUNG Sum, Mr WONG Wai-yin, Miss Christine LOH, Mr LEE Cheuk-yan, Mr CHAN Kam-lam, Miss CHAN Yuen-han, Mr Andrew CHENG, Mr CHENG Yiu-tong, Mr Anthony CHEUNG, Mr CHEUNG Hon-chung, Mr Albert HO, Mr IP Kwok-him, Mr LAU Chin-shek, Mr LAW Chi-kwong, Mr LEE Kai-ming, Mr LEUNG Yiu-chung, Mr NGAN Kam-chuen, Mr SIN Chung-kai, Mr TSANG Kin-shing, Dr John TSE, Mrs Elizabeth WONG and Mr YUM Sin-ling voted against the amendment.

THE PRESIDENT announced that there were 21 votes in favour of the amendment and 33 votes against it. He therefore declared that the amendment was negatived.

Question on the original motion put and agreed to.

MEMBER'S MOTIONS

INTERPRETATION AND GENERAL CLAUSES ORDINANCE

DR LEONG CHE-HUNG to move the following motion:

    "That in relation to the -
  1. Civil Aviation (Aircraft Noise) Ordinance (Amendment of Schedule) Notice 1995 published as Legal Notice No. 539 of 1995;
  2. Airport Authority Ordinance (71 of 1995) (Commencement) Notice 1995 published as Legal Notice No. 540 of 1995;
  3. Import (Radiation) (Prohibition) (Amendment) Regulation 1995 published as Legal Notice No. 541 of 1995;
  4. Import and Export (General) (Amendment) Regulation 1995 published as Legal Notice No. 542 of 1995;
  5. Import and Export (Fees) (Amendment) (No. 2) Regulation 1995 published as Legal Notice No. 543 of 1995;
  6. Import and Export (Registration) (Amendment) Regulation 1995 published as Legal Notice No. 544 of 1995;
  7. Ferry Services (Hongkong and Yaumati Ferry Company, Limited) (Determination of Fares) (Amendment) Ordinance 1995 published as Legal Notice No. 545 of 1995;
  8. Leveraged Foreign Exchange Trading (Calls) (Amendment) Rules 1995 published as Legal Notice No. 555 of 1995;
  9. Tax Reserve Certificates (Fourth Series) (Amendment) Rules 1995 published as Legal Notice No. 556 of 1995;
  10. Tax Reserve Certificates (Rate of Interest) Notice 1995 published as Legal Notice No. 557 of 1995;
  11. Prisoners' Education Trust Fund Ordinance (19 of 1995) (Commencement) Notice 1995 published as Legal Notice No. 558 of 1995;
  12. Official Languages (Amendment) Ordinance 1995 (51 of 1995) (Commencement) (No. 2) Notice 1995 published as Legal Notice No. 559 of 1995;
  13. Tax Reserve Certificates (Amendment) Ordinance 1995 (99 of 1995) (Commencement) Notice 1995 published as Legal Notice No. 560 of 1995;
  14. Official Languages (Authentic Chinese Text) (The Hongkong and Shanghai Banking Corporation Limited Ordinance) Order published as Legal Notice No. (C) 115 of 1995;
  15. Official Languages (Authentic Chinese Text) (Tramway Ordinance) Order published as Legal Notice No. (C) 116 of 1995; and
  16. Official Languages (Authentic Chinese Text) (Peak Tramway Ordinance) Order published as Legal Notice No. (C) 117 of 1995,

and laid on the table of the Legislative Council on 6 December 1995, the period referred to in section 34(2) of the Interpretation and General Clauses Ordinance for amending subsidiary legislation be extended under section 34(4) of that Ordinance until 10 January 1996."

DR LEONG CHE-HUNG: Mr President, I move the motion standing in my name on the Order Paper on behalf of the House. The motion seeks to extend the scrutiny period for the 16 items of subsidiary legislation tabled in the Council on 6 December 1995. As there is no sitting of the Legislative Council between 13 December 1995 to 10 January 1996, the deadline for Legislative Council intervention for these items of subsidiary legislation will fall on 3 January 1996 when there is no sitting.

In order to preserve Members' rights to amend any of these items, it is necessary to move an extension resolution to extend the period for intervention until 10 January 1996.

Mr President, I beg to move.

Question on the motion proposed, put and agreed to.

LEGISLATIVE COUNCIL (POWERS AND PRIVILEGES) ORDINANCE

MR LAU CHIN-SHEK

to move the following motion:

    "That for the purposes of enquiring into the circumstances surrounding the recent labour disputes involving imported workers under the Special Labour Importation Scheme for the Airport Core Programme Projects and related issues, the Legislative Council Panel on Manpower be authorized under section 9(2) of the Legislative Council (Powers and Privileges) Ordinance (Cap. 382) to exercise the powers conferred by section 9(1) of that Ordinance."

MR LAU CHIN-SHEK (in Cantonese): Mr President, I move the motion standing in my name on the Order Paper.

Recently, labour disputes involving foreign workers of the airport projects have aroused much public concern, especially in relation to accusations of wage deductions and payment delays. In order to have an in-depth discussion of the matter, the Legislative Council Panel on Manpower held a special meeting on 5 December this year. Upon hearing the Administration's report on the labour disputes, the Panel was greatly shocked and disturbed about the unfair treatments received by the foreign workers. Although the Labour Department has stepped up its monitoring and enforcement efforts, the result is still disappointing. The Panel thinks that in order to assess the effectiveness of the new steps that have been taken or will be taken by the Government to protect the interests of foreign workers, it is necessary to understand the various arrangements for the importation of foreign labour, the role of the labour affairs companies and the extent of the contractors' responsibility. While the Government may conduct inquiries into individual cases on other aspects, the Panel thinks that it is necessary to conduct an in-depth inquiry in order to achieve the following aims:

  1. To understand the present procedures for the importation of labour and the circumstances under which wages are deducted and payments delayed;
  2. To assess whether the legislation enacted and the administrative measures adopted with a view to implementing and monitoring the Labour Importation Scheme are effective or not;
  3. To assess whether the new measures proposed by the Administration to control unlawful acts are effective or not;
  4. To put forth feasible means to strengthen the supervision, especially that of the Labour Importation Scheme; and
  5. To identify persons responsible for any unlawful acts.

In conducting this inquiry, the Panel on Manpower has to ask the parties concerned to provide evidence and relevant documents, but such parties may refuse to attend the inquiry or invoke the Legislation (Powers and Privileges) Ordinance for protection. In the circumstances, we have to ask this Council that the Panel be authorized under section 9(2) of the Legislative Council (Powers and Privileges) Ordinance to exercise the powers conferred by section 9(1) of the Ordinance. The Panel on Manpower, having submitted a report to the House Committee and obtained its support on 8 December, proposes the motion in this Council today. Now, I shall formally move the motion that the Legislative Council Panel on Manpower be authorized under section 9(2) of the Legislative Council (Powers and Privileges) Ordinance to exercise the powers conferred by section 9(1) of that Ordinance.

Mr President, with these remarks, I move the motion. Thank you.

Question on the motion proposed.

SECRETARY FOR EDUCATION AND MANPOWER (in Cantonese): Mr President, the recent outbreak of labour disputes on Airport Core Programme (ACP) work sites is a matter of serious concern to the Government. I should like to assure Members that a thorough investigation into each of the cases is being conducted. Hong Kong is a civilized society where the rule of law is paramount. We will not tolerate abuse of imported workers and will instigate prosecutions against those who may have breached the laws of Hong Kong. We fully appreciate Members' understandable concern about such cases and their desire to get to the truth to find out what went wrong and who is responsible. We share these sentiments entirely. However, it is not necessary nor appropriate for the Council to confer on the Manpower Panel the power under section 9 of the Legislative Council (Powers and Privileges) Ordinance to conduct an enquiry into the circumstances surrounding the labour disputes for the following reasons.

First, these labour disputes are already under investigation by the law enforcement agencies. The Labour Department has been making good progress in its investigations. In some of these cases, the investigations are at an advanced stage. Prosecutions relating to breaches under the Employment Ordinance are being considered in most of the disputes and hearings for the contractors and subcontractors involved have been arranged for this purpose. These hearings are an integral part of the due process which must be observed before taking a final decision on whether or not to lay charges. These investigation procedures are likely to be affected if the Manpower Panel of this Council is to conduct a parallel inquiry into the disputes. The use of the Legislative Council (Powers and Privileges) Ordinance whether to summon persons involved in the dispute or to ask for documents relating to the disputes will run the serious risk of delaying or jeopardizing our inquiries. I am sure Members would not wish to see this happen.

The Immigration Department is investigating into the various dispute cases to see if there are any offences under the Immigration Ordinance. The police are also at present investigating six constructions sites in connection with the recent labour disputes to ascertain whether any person has breached the law. Before these investigations are completed, any action taken by the Legislative Council to invoke the powers under the Legislative Council (Powers and Privileges) Ordinance to enquire into the circumstances of the cases may prejudice the outcome of such investigations. Any discrepancies in the statements and testimony of the same witnesses called by the police, the Immigration Department and the Panel, and the premature release of documents or evidence in connection with the cases possessed by the law enforcement agencies may impede the progress of our investigations and may adversely affect the chance of subsequent prosecutions.

Secondly, we have been in contact with the New China News Agency and are working with the relevant Chinese authorities with a view to improving communication and co-operation particularly in respect of the operation of and the legal charges imposed by the Chinese labour service companies to ensure that imported workers from PRC are aware of their rights and benefits, and to safeguard them from being exploited. I understand that the Chinese authorities have already set up a special team to investigate at their end the complaints about wage deductions. There is therefore no urgent need for this Council or the Manpower Panel to carry out an enquiry at this stage. Indeed, Members should await the outcome of the efforts by both Governments before deciding whether any further action is warranted.

As an open and accountable Government, we fully acknowledge that the public has the right to know more about the causes of and the results of our investigations into the current labour disputes. We have no intention of hiding the truth from members of the public. I intend to present to this Council in about three months' time a detailed report on the results of all our investigation efforts. This report will not only set out the outcome of investigations in Hong Kong, but will also include information about the role of the labour service companies and the result of our liaison efforts with the Chinese authorities. This will enable both Members and the general public to have a full picture of the problems involved, their causes, the effect of the various remedial measures we have recently taken and any further recommendations we may put forward to enhance the integrity of the system. Members will be given ample opportunity to discuss and raise questions on this report.

I personally led the team of officials and senior representatives of the Airport Authority (AA) and MTRC to answer questions on the ACP labour disputes at the Special Manpower Panel Meeting on 5 December 1995. My colleagues and I, including the authorities concerned, AA and MTRC, are very much prepared to continue to co-operate fully with the Manpower Panel without prejudice to our investigations. The exercise of the Legislative Council powers and privileges, if targeted at the Administration and the other institutions mentioned above, is absolutely unnecessary.

We have already provided information to the Manpower Panel on the nature of the recent labour disputes. I do not wish to repeat here. However I would like to reiterate that we have already added new conditions to strengthen our monitoring system to minimize the possibility of abuse of the scheme. With effect from 1 November 1995, employers are required to: (1) give a copy of employment contract to his imported workers; (2) provide them with details of their monthly earnings; (3) provide them with a monthly statement showing all transactions of their bank accounts. Within eight weeks upon the arrival of an imported worker in Hong Kong, the employer is required to grant him paid leave to enable him to attend briefings on his statutory rights as an employee under Hong Kong labour laws and his contractual rights under the employment contract. On top of these measures which are already in force, we intend to require employers to give an undertaking to the Labour Department that the imported workers have received a copy of the employment contract specifying the post and amount of wages before they come to Hong Kong. Officers of the Immigration Department will ask the imported worker to present his employment contract for inspection purpose shortly upon their arrival in Hong Kong.

I would like to assure this Council once again that we do not and will not tolerate any abuse of imported workers. We are committed to upholding the integrity of the ACP Labour Importation Scheme. Malpractices by a few threaten the good name of other law-abiding employers and the good name of Hong Kong. We are fully committed to do everything within our power to combat abuses and malpractices. Labour Inspectors of the Labour Department conduct regular inspections to the places of work of imported workers to check whether provisions under the Employment Ordinance and the Employees' Compensation Ordinance have been complied with and to guard against other abuses which constitute breaches of the conditions under the Scheme.

I would also like to make clear, once again, that without prejudice to any prosecutions under the laws of Hong Kong, employers who are found to have contravened conditions of the scheme will be liable to: (1) withdrawal of quotas in hand; (2) refusal of application for extension of stay of the employee upon expiry of visa; and (3) refusal of application to import labour under the ACP scheme in future.

To conclude, I would assure Members again that we have been proceeding with our investigations into the labour disputes and related problems as a priority task. We are making every effort to improve the effectiveness of the various controls and safeguards under the ACP Scheme. The whole process of our work is open and transparent. We will work closely with concerned Members of this Council, the Manpower Panel and other interested parties during this process. We are open and receptive to any suggestions and advice on how we can improve the operational and monitoring system of the Scheme.

We do not see a need at this stage for this Council to empower the Manpower Panel under section 9 of the Legislative Council (Powers and Privileges) Ordinance to conduct hearings and enquiries into these labour disputes. We are very concerned that this will run the risk of prejudicing the Government's investigation efforts and thus will not be in the interest of the workers or the community as a whole. I would therefore ask Members to consider this motion in the light of my comments and vote against it. In the event this motion is passed, I will urge Members of the Council and the Manpower Panel to await and examine the Administration's detailed investigation report which we will, I repeat, submit in about three months' time before considering whether or not to invoke the Legislative Council (Powers and Privileges) Ordinance to conduct hearings and enquiries.

Thank you.

MR TSANG KIN-SHING (in Cantonese): Mr President, on 26 September this year, a strike took place involving 800 Thai workers of the Route 3 and airport projects over wage deductions. From that day, until November this year, there were altogether seven cases in which the wages of the foreign workers of the new airport projects had been deducted. More than 2 000 workers, representing half of the total number of foreign workers in the new airport projects, were involved in these cases. They were Filipinos, Thais and Chinese by race. I do not wish to argue with the Secretary for Education and Manpower over what he said earlier about China, but in fact the countries involved included the Philippines and Thailand.

I have taken an active part in dealing with the wage deduction cases involving foreign workers, helping them fight for their reasonable interests. In the course of my involvement, I have come to understand that this is a modern version of the story of marketing labour to be exploited. I think that our policy of importation of labour has attracted workers form nearby countries to Hong Kong, only to be exploited by various parties. They might have regretted coming to Hong Kong, but they still could not avoid paying back the debts owed to the so-called labour affairs companies an other persons in their native countries. This is because they are bound by contracts into which they have entered. In the circumstances, they have no choice but to bear with the exploitation and work patiently.

Such were not cases which happened in the 19th century when Chinese labour was marketed to San Francisco to be exploited as railway workers. They actually happened in the 20th century in connection with the Airport Core Programme of Hong Kong. As a citizen of Hong Kong, I think that is really shameful.

The Democratic Party is of the opinion that wage deductions are directly related to the implementation of the policy of the importation of labour. The present circumstances have shown that the Government is not able to control the incidents of exploitation. In view of this, we think that the Legislative Council should follow up the cases and inquire into the matter so as to do justice to the people of Hong Kong and review the work done by Government departments.

The Democratic Party thinks that an inquiry into the cases of wage deductions should be conducted without further delay. The Secretary for Education and Manpower said that it would take three months, but we can imagine what the situation would be during the Chinese New Year holidays in Hong Kong in about a month's time. Many of construction sites will be closed and it is common for workers, especially the Chinese workers, to return home for the holidays. However, many people are worried that they cannot come back to Hong Kong after they have returned home. In the past, workers who had gone on strike were repatriated from Hong Kong to their native countries by the so-called labour affairs companies. Therefore, the Democratic Party urges the Legislative Council to invoke the Legislative Council (Powers and Privileges) Ordinance to conduct an open inquiry into the matter. This will not only serve to redress the grievances of the foreign workers, but also make the people of Hong Kong more aware of the loopholes of the policy of the importation of labour and of the role of the Government. The Democratic Party will take an active part in the inquiry, so as to find out the truth and do justice to the people of Hong Kong.

The Democratic Party hopes that Members of this Council will take the same stance and lend their full support to the Panel on Manpower to invoke the Legislative Council (Powers and Privileges) Ordinance to conduct the inquiry.

These are my remarks.

DR PHILIP WONG: Mr President, as a member of the Airport Authority, I wonder if I should declare interest. Can you give a ruling? And if so, may I have your permission to vote?

PRESIDENT: I do not see any direct personal pecuniary interest involved.

MR IP KWOK-HIM (in Cantonese): Mr President, the recent incident of wage deductions concerning the foreign labour of the Airport Core Project has really aroused much public concern in Hong Kong. It is understandable that my colleagues in this Council have demanded to follow up the case by making an inquiry into the matter. The Democratic Alliance for the Betterment of Hong Kong (DAB) also agrees that the matter should be followed up.

We notice that the Chinese Government is very concerned about this incident of exploitation of the foreign labour. Mr ZHANG Liang-dong, Secretary for Economic Affairs of the Hong Kong and Macau Affairs Office, has said that in the 1990s of the 20th century, marketing of labour to be exploited which occurred about a century ago should not happen again. To tackle the present problems, including wage deductions and the poor living environment of the foreign labour, the department concerned in China is planning to set up an investigation unit which will first inquire into the labour affairs companies in the two provinces of Guangdong and Fujian. Last month, the central authorities also held a joint meeting in which a demand was made for the authorities of the two provinces of Guangdong and Fujian to find out the reasons for the strike of the foreign labour in Hong Kong and to submit a report to the central authorities. Furthermore, Mr TSANG Yuk-shing and Mr TAM Yiu-chung, Chairman and member of the DAB respectively, after meeting with the officials of the Secretariat for International Co-operation, Ministry of Foreign Trade, have been given to understand that the Chinese Government is planning to step up the control of the labour affairs companies by means of legislation in order to plug up the present loopholes of the administrative rules to control the companies.

Earlier, I heard the Government's commitment to inquire into the matter and to produce a report after three months which will identify the loopholes of the present operation of the Labour Importation Scheme of the Hong Kong Government, make suggestions of improvement and introduce ways to monitor the agents for the importation of foreign labour. The report will be submitted to the Legislative Council.

Now that both the Governments of China and Hong Kong have started making inquires into the matter, should this Council use resources at this time to serve an overlapping purpose? Or would it be more appropriate for us to consider whether to hold an inquiry after the Government has submitted the report in three month's time? These are my remarks.

MR FREDERICK FUNG (in Cantonese): Mr President, the Hong Kong Association for Democracy and People's Livelihood (ADPL) supports the Honourable LAU Chin-shek's motion because we think that, for many years, there has been much controversy in Hong Kong over the issue of the importation of foreign labour. Such an issue is by no means a recent one. During the past few years, we have expressed the concerns of the public and of Members of this Council and we have also given advice in this Council. On every occasion, the replies given by the Government in this Council was that things could be accomplished and there would be no problem, but problems have at last arisen. The recent disputes have provided us with an insight that despite all the information, data, methods of implementation and systems revealed by the officials, the Government has been unable to accomplish what they promised to accomplish. In any case, not enough has been done. As members of the Legislative Council, we have given our support to the work of the Government, we have allocated funds for the Government to do its work and we have also approved staff increase, especially in the Labour Department, to deal with the problems of foreign labour.

Now that problems have arisen, I think there are at least four points which we members of the Legislative Council have to attend to and which we have to find out more through the Panel on Manpower.

We demand the Panel be authorized to exercise powers and privileges. We wish to achieve the following:

  1. understand the whole issue, but we have to make it clear that we are not demanding to investigate the case. We have to understand what has happened and why things have come to this situation.
  2. We have to understand the system which the Government has established, because the operations in the past could neither give protection nor prevent such disputes form happening, thereby causing problems. We have to stress that we are only trying to understand the system but not to find out who is responsible and who should bear the responsibility.
  3. We want to understand the situation and the present system because we wish to give advice and make recommendations concerning the present system with a view to solving the present problems.
  4. We want to examine the problems with the Government's entire monitoring system over foreign labour so as to enable us to give advice accordingly.

Therefore, I do not understand why we should not try to understand the problems and make recommendations accordingly.

Earlier, the Secretary for Education and Manpower told us that government departments such as the Immigration Department and the police might be carrying out investigations and preparing reports and that they might even institute prosecutions. But will the work of the Panel affect them? I think it can be left for the Panel to decide in its meetings whether we should exercise the powers immediately or postpone the exercise of such powers after considering the reasons given by the Government and the prevailing circumstances. In the Alex TSUI's case, we did postpone the exercise of such powers. I notice that Members of the Legislative Council do not share the worries of the Government officials who think that we would, regardless of the correspondences, force the Government into a corner so that it cannot move at all.

Finally, I would like to mention one point. We would certainly welcome the great amount of efforts made by the Chinese Government and the local governments of China and we would certainly welcome the Democratic Alliance for the Betterment of Hong Kong to influence some of the policies of China through its many contacts and connections. But we think the Government of Hong Kong and the legislature of Hong Kong can handle local problems. As regards overseas problems, we think they should be dealt with by the overseas governments or the governments concerned. Coming back to the question, should the local Government and the local legislature deal with these problems? And do they have to deal with them? I think they should do so and have to do so. The more active the Chinese Government deals with the matter, the more active we should be because it is a matter of co-ordination. I do not think that such co-ordination should be left to the executive. Since the legislature has such powers and responsibilities, it should deal with the matter. I therefore support Mr LAU Chin-shek's motion.

MR JAMES TO (in Cantonese): Mr President, having taken part in two enquiries conducted by this Council through invoking the Legislative Council (Powers and Privileges) Ordinance, I would like to respond to the Secretary for Education and Manpower on some technical points.

The Secretary for Education and Manpower just now said that he was very worried. He even pointed out that the normal investigation would be hindered if witnesses were summoned by this Council to attend an enquiry held under the said Ordinance. He cited two concrete examples. Firstly, he pointed out that if the witnesses to be summoned to appear at a hearing of this Council were the same as those who had been summoned to a court or police station, then the outcome might be prejudiced should different testimonies were given on different occasions. However, the Secretary seemed to have failed to further explain what problem would be resulted from such discrepancies.

In response to the Secretary's opinion, I would ask a question: Should the same witness give two different statements, especially when he is under oath on both occasions? If two different statements are given by the same witness, then logically, whether he is a government official or a man in the street, the Government should investigate to see whether someone has committed perjury on some occasion. Further investigation might be needed. In such a case, it will not affect the appropriateness of the questions raised by the Legislative Council or a court of law. Moreover, there is safeguard provided by the Ordinance that evidence given at this Council cannot be availed of in any other legal proceedings, regardless of whether it is self-incriminating, unless the Attorney General is considering to prosecute the witness or this witness has committed perjury in an enquiry conducted by this Council. Logically, these are the exceptions. Other than that, the evidence given is not allowed to be used for other purposes. In the circumstances, the Council has to grasp all the facts which will be our basis for monitoring the Government or for future legislation purpose. Thus we do not see any reason why there will be adverse influence caused by summoning the same witnesses, who have testified in a court for the same incident, to attend this Council's enquiry.

Secondly, the problem is about the so-called premature release of documents. The Secretary did use the words "premature release of documents". Should there really be such a document whose influence is far-reaching, please do have confidence in the Legislative Council, as we have invoked the Ordinance on two previous occasions. Everybody knows that we will exercise caution and will seek a lot of legal advice before we invoke the Ordinance. Should there be any problem, I believe the Government will provide us with legal advice and will remind us of the possible implications on legal proceedings. At the same time, legal advisors of the Legislative Council will also advise us. I would emphasize that the enquiry conducted by this Council is really of different nature from investigations conducted by different departments or the law enforcing arms of the Government. What the Members want to do is to find out shortcomings within the system rather than with an eye to prosecute the law breakers by invoking the existing laws.

In the past, we had conducted an enquiry for the incident at Kwun Lung Lau. At that time, the Government was also investigating the incident. It was possible that some people might have to bear criminal or civil liabilities. Yet this Council was not stopped from conducting an enquiry by the Government for that reason. Furthermore, the Legislative Council has refrained from invoking this power in a number of important incidents. Whenever this power is invoked, prudence will be exercised. May I cite an example. Teargas was used by the Correctional Services Department or the police in two riots involving the Vietnamese boat people. It was said that deaths and severe injuries were caused. In these incidents, the Governor handled the situation in a wise manner because he was aware that these were important incidents catching the attention of the international community and might lead to disgrace to Hong Kong people. Thus, he immediately appointed some Justices of the Peace to look into the matters or commissioned an independent committee to investigate the incidents. But this time, the Government is handling the problem in a clumsy way. The Government should have responded by appointing an independent committee for this would at least earn more votes in this Council. However, if the Government insists that the problems with the system could be solved by referring the incident to the Immigration Department or the police, I believe no responsible Member will agree to it.

I must also point out that the Government's viewpoints as mentioned above should be rebutted. I hope Members will support this motion and work together to get down to the truth in order to avert unnecessary criticisms that Hong Kong will suffer because of this incident.

MR JAMES TIEN (in Cantonese): Mr President, the Liberal Party supports the Honourable LAU Chin-shek's motion. Our objectives may be the same in some aspects but different in other aspects. It is our common objective, however, to find out who are responsible for the wage deductions. We see eye to eye on this point. But from another point of view, Mr LAU may want to scrap the Importation of Labour Scheme for the New Airport and Related Projects or even all kinds of labour importation schemes through the conducting of this enquiry. From the point of view of the Liberal Party, we want to find out any shortcomings in this system and to see whether the employers, especially those foreign-based contractors, many have paid the wages but the wages do not go to the pocket of the workers. What we want to know is the problem within this process.

Mr President, the importation of labour scheme has been implemented in Hong Kong for a long period of time. Minor problems are inevitable. But in this incident, although the number of companies involved is small, the number of people affected is a great one, involving hundreds of people. In view of this, we want to know why this has happened. It is incredible that the internationally renowned contractors would illegally deduct wages from the workers. So we support the proposal of conducting a hearing in order to get a thorough understanding. Should there be any loopholes, we hope to improve upon them so that our labour importation scheme will continue to operate for the early completion of our new airport. Thank you, Mr President.

MR CHAN KAM-LAM (in Cantonese): Mr President, the public is undoubtedly discontented with the incident that wages of our imported workers have been withheld. Fortunately, the incident has almost been fully settled.

Although I do not have any strong view in regard to the Honourable LAU Chin-shek's motion, I must point out that should the Panel on Manpower be authorized to exercise such powers, we must exercise them with caution. Any attempt to override the investigation being conducted by the law enforcing departments or to abuse the powers and privileges enjoyed by the Legislative Council will be improper.

In my opinion, the Panel on Manpower should respect the independence of the government department in conducting the investigation concerned.

Thank you, Mr President.

MR MICHAEL HO (in Cantonese): Mr President, the Secretary for Education and Manpower had just now emphasized time and again in his speech that it would be unnecessary for this Council to conduct an inquiry. He also told us that the Government was investigating the matter, repeatedly saying that our inquiry might affect the normal procedures and obstruct the investigation. Moreover, the Secretary also mentioned that the Immigration Department would find out in how many of the cases had offences actually been committed. Here I would like to point out that the Immigration Department will only be inquiring into cases which have contravened the Immigration Ordinance and the Labour Department's investigation will mainly be concerned with whether anyone has contravened the labour laws. A case which has neither contravened the labour laws nor the Immigration Ordinance may fall outside the terms of reference of the Immigration Department and the Labour Department.

I hope we can examine the whole system of importation of foreign labour and find out whether there are any shortcomings. That is the responsibility of the Legislative Council of Hong Kong towards the people of Hong Kong.

The Secretary for Education and Manpower said that its investigation might be affected if documents and evidence were prematurely disclosed. He mentioned many other similar presumptions. Mr President, I wish to tell the Government that it does not have to worry. In fact, we have already conducted two similar investigations. This legislature is one which works with reasons and we would certainly be careful, but we would also thank those who remind us to consider certain matters. Therefore, I wish to tell the Government to forget about the presumptions. We do appreciate that the staff of the Labour Department and the Immigration Department have made a lot of efforts and they have done a lot of hard work on the airport construction sites. Many of them have worked overtime, or have even worked so hard that they have become sick. I believe colleagues of this Council understand very well that these people have worked very hard.

Concerning the policy of importation of foreign labour, we realize that there have been incidents of exploitation. This clearly shows that there are problems in the monitoring mechanism. As a monitoring authority, we are responsible for problems in monitoring. Earlier today, I have spoken with some Government officials and they tried to convince us that this inquiry was unnecessary. They told us that even under a good system, there are bound to be people who would make use of the loopholes and exploit others, just like there would still be thieves even though we have the police. However, upon seeing the thieves, we would certainly question the authority responsible for security. Similarly, in this incident, no matter how well the mechanism has been designed, we will question what is the problem with the whole system and what is the problem with the monitoring system once incidents of exploitation have occurred. I am very pleased that investigation is being carried out by the Government as well as the Chinese Government. Although such investigation is somewhat overdue, it is better than nothing.

The Honourable IP Kwok-him said we could wait, but I think that my colleagues here who have become Members of the Legislative Council through elections are representatives of the people of Hong Kong. As such, we are responsible to sort matters out when there is a problem with the systems of Hong Kong. If we leave it to the Government to investigate and if we only invite the Chinese authorities and the Chinese Government to investigate, then we have not fulfilled our responsibilities.

Mr President, today I hope that my colleagues would lend their support to this motion so that we can invoke the Legislative Council (Powers and Privileges) Ordinance to inquire thoroughly into the matter to account to the public of Hong Kong.

These are my remarks.

MR LAU CHIN-SHEK (in Cantonese): Mr President, since the occurrence of the modern version of marketing labour to be exploited, my colleagues and I have mentioned time and again that this incident has brought shame on the people of Hong Kong. Talking about shame, I would like to tell Members that the shame brought on the Hong Kong people may be great or small. Some feel that it is abstract and others feel that it is concrete. Some feel that it may go on for just one or two days while others feel that it would last for a long time. However, considering the sufferings and unpleasant experience of the victims, that is the exploited foreign workers, the shame we face actually reminds us of our responsibility.

What has deeply impressed me is that almost all imported workers of the airport projects have told me that they regret having come to work in Hong Kong. I think you are well aware of the whole procedure and I am not going to repeat it. As we are confronted with this incident today, I would like to point out that many labour organizations have been complaining to the Government as well as some government-related organizations that there are many problems, such as illegal deductions of the wages of foreign workers. The Honourable Frederick FUNG has already given us details about this. But the Government told us that it had already done something to improve the situation and that we can set our mind at ease for there will be no problem. But just let us look at the result!

I want to point out that the problem exposed this time is not discovered by the Government. Not a single problem has been discovered by the Government. They are exposed by the imported workers themselves or by some labour organizations. The Secretary for Education and Manpower has said that what we propose to do would affect the prosecution process. But I would like to remind him that we also have legal advisors who will advise us what we should do. Moreover, the Panel will exercise great caution. But most importantly, as the Government is the policy maker as well as the organization which implements it, the Government itself is the root of the problem. The Government said that investigation had been completed, but is it all that it should do? I am not saying that investigation is not appropriate, but I think the Government should also allow this Council to conduct an objective and unprejudiced enquiry into this matter.

Finally, this incident reminds me of a Jewish friend who told me that when he was on his way back to Israel, he witnessed the miserable plight of the Palestinians. As a result, he decided to stay there to help them despite their political, religious or even economic and cultural differences. Today, confronted with the situation of these unfortunate imported workers in connection with the airport projects. Members of this Council are duty-bound to offer their help, regardless of our standpoint in politics, religions, cultural and economic issues, in the hope that such incidents will not occur again and that our policy can really be implemented in a fair manner.

Mr President, with these remarks, I would like to express my thanks to all Members, whether they will vote for or against my motion or will even abstain from voting.

Question on the motion put.

Voice votes taken.

THE PRESIDENT said he thought the "Ayes" had it.

Dr Philip WONG claimed a division.

PRESIDENT: Council shall proceed to a division.

PRESIDENT: I would just like to remind Members that they are now called upon to vote on Mr LAU Chin-shek's motion. Will Members please register their presence by pressing the top button in the voting units on their respective desks and then proceed to vote by pressing one of the three buttons below?

PRESIDENT: Before I declare the results, Members may wish to check their votes. Are there any queries? The result will now be displayed.

Mr Allen LEE, Mrs Selina CHOW, Mr Martin LEE, Mr SZETO Wah, Mr Edward HO, Mr Ronald ARCULLI, Mrs Miriam LAU, Mr Albert CHAN, Mr CHEUNG Man-kwong, Mr Frederick FUNG, Mr Michael HO, Dr HUANG Chen-ya, Miss Emily LAU, Mr LEE Wing-tat, Mr Fred LI, Mr Henry TANG, Mr James TO, Dr YEUNG Sum, Mr Howard YOUNG, Mr WONG Wai-yin, Miss Christine LOH, Mr James TIEN, Mr LEE Cheuk-yan, Mr CHAN Wing-chan, Miss CHAN Yuen-han, Mr Andrew CHENG, Mr CHENG Yiu-tong, Mr Anthony CHEUNG, Mr Albert HO, Mr LAU Chin-shek, Dr LAW Cheung-kwok, Mr LAW Chi-kwong, Mr LEE Kai-ming, Mr LEUNG Yiu-chung, Mr Bruce LIU, Mr MOK Ying-fan, Miss Margaret NG, Mr SIN Chung-kai, Mr TSANG Kin-shing, Dr John TSE, Mrs Elizabeth WONG and Mr YUM Sin-ling voted for the motion.

Mr CHIM Pui-chung, Dr Philip WONG, Mr CHOY Kan-pui, Mr David CHU, Mr Ambrose LAU and Mr LO Suk-ching voted against the motion.

Dr LEONG Che-hung, Mr Eric LI, Dr Samuel WONG, Mr CHAN Kam-lam, Mr IP Kwok-him and Mr NGAN Kam-chuen abstained.

THE PRESIDENT announced that there were 42 votes in favour of the motion and six votes against it. He therefore declared that the motion was carried.

PRESIDENT: I have accepted the recommendations of the House Committee as to the time limits on speeches for the motion debates and Members were informed by circular on 11 December. The movers of the motions will have 15 minutes for their speeches including their replies and another five minutes to speak on the proposed amendment. Other Members, including the mover of the amendment, will have seven minutes for their speeches. Under Standing Order 27A, I am required to direct any Member speaking in excess of the specified time to discontinue his speech.

REDUCTION OF EMISSIONS FROM DIESEL VEHICLES

MRS MIRIAM LAU

to move the following motion:

    "That this Council supports that measures be taken to reduce emissions from diesel vehicles, but as both petrol and diesel vehicles attribute to air pollution and before it can be confirmed which one of the two types of vehicle is more environment-friendly, urges the Government to review the mandatory scheme of phasing out diesel vehicles of four tonnes or below in the consultation paper "Further Proposals to Reduce Emissions from Diesel Vehicles" and to replace the proposed scheme with incentive measures to attract owners of diesel vehicles to change to petrol vehicles on a voluntarily basis, as well as to expeditiously explore other measures which are more effective and generally accepted by the public, in order to improve the air quality in the territory."

MRS MIRIAM LAU (in Cantonese): Mr President, I move the motion standing in my name as set out in the Order Paper.

In September this year, the Government published a consultation paper which proposes the diesel-to-petrol scheme offering concessions to the trade in order to encourage operators of diesel vehicles of four tonnes or below to switch to petrol. Apart from that, stringent emissions controls against heavy diesel vehicles will be exercised. It is considered that the public and the trade would welcome the Government's endeavours to improve air quality, to protect the public health and to cope with the loss that the operators of diesel vehicles may suffer under this scheme, but ever since the commencement of the consultation period has begun, different opinions have been aired and no unanimous conclusion could be drawn. What is more, voices of opposition from the affected trade is lingering in our ears.

The ultimate purpose of my motion today is the in line with the Government's objective, that is, to improve the air quality of Hong Kong and to protect public health.

The Government has been warning that the respirable suspended particulates (RSP) emitted by vehicles running on diesel is often exceeding the acceptable level and RSP may lead to various kinds of respiratory illnesses and even cancer. The Government also quoted a report from a United Kingdom newspaper that the RSP has caused death of tens of thousand of people a year. It seems to imply that those who do not support the Government's proposal should be held responsible for the death of these people.

In fact, the RSP is only one of the numerous harmful substances emitted by vehicles. Emissions by diesel vehicles contain more particulates and nitrogen oxides, while emissions by vehicles running on petrol contain more carbon monoxide, carbon dioxide, and benzene, which may cause cancer. Since the diesel vehicles and petrol vehicles emit different pollutants which are harmful to the environment and posing a health hazard to us, some academics find that there is no clear conclusion whether diesel or petrol is more environmental friendly.

However, it is the Government's foregone conclusion that petrol is more environmental friendly than diesel. The Government admits that by switching to petrol harmful pollutants in the air will increase but insists that such pollutants can be kept at a safety level. Unfortunately, apart from some homemade charts explaining the Government's views, there is no further substantiation such as academic report and research literature to support its argument or to rebut the academics' conclusion drawn from their study.

If other pollutants are ignored and only suspended particulates are the only pollutant to be dealt with, the Government can feel justified and confident to target at diesel vehicles. However, according to a research report by the Hong Kong Polytechnic University, the emissions of taxis and public light buses in the busiest areas only account for 23.5% of the particulates found in those areas. Besides, according to another research report by the Hong Kong University, particulates emitted by heavy vehicles and big buses account for a great proportion while particulates emitted by taxis and small buses only account for a small proportion.

These two research reports have coincidentally pointed out that the main culprit of emitting a large amount of particulates is not taxis, small buses or light diesel vehicles. However, the Government is targeting at diesel vehicles of four tonnes or below and force them to switch to petrol. What the Government is doing is obviously putting the cart before the horse and reflects that it lacks a sense of proportion.

Even though the Government's proposal can really lead to reduction of suspended particulates in the air, can the people breathe fresh air once the proposal is implemented? Certainly not, because when the problem of suspended particulates has been solved, another pollution problem will emerge. After the diesel vehicles have switched to petrol, the number of cars running on the road will not decrease. In the future, there will be the same number of petrol vehicles running the same mileage that the diesel vehicles are now running. Harmful emissions will also be produced by these vehicles. If suspended particulates may cause death, carbon monoxide and benzene are also lethal, though the cause of death is different.

The Government has emphasized time and again that all problems can be resolved once petrol vehicles are fitted with catalytic converters. But will all pollutants emitted by petrol vehicles disappear? Certainly not. The Government also admits that some air pollutants will increase, but nevertheless will be kept within the safety level. Although mandatory renewal of catalytic converters will be part of the Government's proposal, no one can guarantee that catalytic converters will not be out of order. Neither is there any research to show that the performance of catalytic converters will not be affected even after they have become worn out. If the catalytic converters do not perform satisfactorily or if it has totally failed, the harmful emissions produced by petrol vehicles will be more lethal than the emissions produced by diesel vehicles as the former can kill without any trace.

Mr President, the Government has proposed fuel duty concessions, reduction of the annual licence fees for vehicles and the first registration tax in order to lower the operating costs of the taxis, public light buses and small school buses. Yet these concessions are provided only during the first 10 years.

Under the veil of concessions in order to attract the taxis and public light buses to switch to petrol, these are in fact mandatory measures which induce the drivers into a snare who will then find themselves reap the benefits first and then bear the hardships later. Like it or not, the diesel vehicle owners have to switch to petrol as soon as possible, otherwise, they have to bear a substantial increase in licence fees. Operators of light vans will suffer most because they will not enjoy any concession as the Government is of the opinion that these operators can absorb the extra cost with their clients and fuel constitutes a small proportion of transport costs. I really cannot understand the logic behind the Government's argument. Taxis and public light buses can enjoy concessions so that their customers, that is the passengers, can benefit, but the clients of the light vans cannot. In fact, not all light vans are owned by large companies, most of the light van owners are self-employed. The current proposal of the Government will directly affect their livelihood.

On the other hand, the Government does not agree that increase in the annual licence fee for vehicles which continue to stay on diesel is a punitive measure. It said that it was necessary to raise the operating costs of the diesel vehicles in order to be fair to other vehicles which have switched to petrol. The Government's argument is just like saying that if A is robbed of $10, then B must be robbed of $10 in order to be fair to A. This is a novel sort of "fairness" put forth by the Government.

Obviously what the Government is going to provide is not real concessions. The diesel vehicle owners now pay less fuel duty, which will be increased by the Government in the future. The Government will not incur any fiscal loss but the public will suffer when the concession period is over in 10 years' time, operating costs of petrol vehicles will increase as fuel duty also increases. Eventually the extra cost will be shifted onto the commuters who have to pay a fare higher than that of other public transport running on diesel.

The public do not mind paying higher fare in order to enjoy fresher air. But if the fare increase is not as moderate as the Government has estimated and the fuel is not as environmental friendly as the Government has expected, will the public be willing to support an expensive but not effective scheme?

In regard to the operating costs, which include both the costs of maintenance and fuel, of taxis and public light buses running on petrol, there are discrepancies between the estimation by the Government and by the trade. If the trade's estimation is correct, then the current proposal of the Government will indeed deal a heavy blow to the trade and jeopardize the future development of the trade.

The trade is worried that after switching to petrol, the performance of the vehicles will be worse than diesel vehicles and will no longer suitable to the road situation in Hong Kong. Despite that, the Government points out that in many American cities such as New York, petrol taxis run a longer mileage than Hong Kong taxis. It further argues that as taxis in these foreign countries can run on petrol, there is no reason why it is not feasible in Hong Kong.

I would like to ask the Government some questions: Are taxis in Hong Kong operated in the same way as the taxis in New York? Are the road situations in these two cities the same? Do they have the same climate and geographical environment? If the answer is no, how can the Government conclude that the foreign model can apply to Hong Kong? Since there are discrepancies between the estimated operating costs presented by the trade and the Government's estimate, and the foreign model may not be applicable to Hong Kong, why not the Government conduct an experiment to compare the performance of a diesel taxi and a petrol taxi. Only in so doing will the data obtained can truly reflect the discrepancies in operating costs by running on diesel and petrol and prove that the fare increase will be as moderate as the Government has expected. Most importantly, we have to obtain data which are acceptable and trusted by the public and the trade.

Mr President, as I have raised so many questions on the effectiveness of the Government's proposal, this may lead some to query whether I am urging the Government to stop doing anything and allow the worsening of our air quality. Certainly not. I must reiterate that I share the objective of the Government and the environmentalists: to show our determination to improve the air quality by our acts.

The current proposal put forth by the Government is exactly what Dr BARRON of the Hong Kong University has suggested. He recommends that all light vehicles should run on petrol and tighter emission controls and testing should be imposed on heavy vehicles. However, Dr BARRON also agrees that there is another alternative as suggested by Dr RUSCO and Dr WALLS of the Hong Kong University: to use high quality diesel and upgrade the emission standard of new vehicles. In addition, maintenance should be upgraded in order to reduce the amount of pollutants, including suspended particulates, emitted by all diesel vehicles. Dr RUSCO and Dr WALLS are of the opinion that their suggestion is more effective but less expensive than Dr BARRON's.

Thus we are facing many alternatives rather than either "death" or the Government's proposal as it warns. In fact, we do not come to the end of a blind alley, for there are many viable routes to take.

According to a research conducted by the Hong Kong Polytechnic University, if all taxis and public light buses have switched to petrol, the total amount of suspended particulates and RSP will be reduced by 12% and 18%. However, if low pollution diesel is used, the respective figures will be 8% to 10% and 12% to 15%.

The report by Dr RUSCO and Dr WALLS also points out that by switching to quality diesel of low sulphur content, emissions will be reduced by 25%, and the particulates and nitrogen oxides emitted will be reduced by 22.5% and 21.7% respectively. A report by the Hong Kong University of Science and Technology has quoted an overseas experiment result that a 0.25% to 0.05% reduction in sulphur content will lead to 70% reduction in suspended particulates emitted.

It is clear that the use of low sulphur content diesel will reduce the emissions of diesel vehicles, including suspended particulates. Moreover, we will get an instantaneous and overall improvement in air quality. In fact, the Government has planned to introduce 0.05% sulphur content diesel in April 1997 and the effect is yet to be seen. But now the Government is trying to implement a costly but ineffective policy. It is hardly convincing. In fact, what the Government should do now is to introduce low sulphur content diesel at an earlier date and further lower the sulphur content of diesel.

The use of low sulphur content diesel should be accompanied by a proper testing and maintenance scheme in order to ensure that emissions by diesel vehicles do not exceed the standard required. As early as 1991, Dr BARRON pointed out that the root of air pollution in Hong Kong is that no one can guarantee that the engine of diesel vehicles are correctly tuned. Although the problem has been highlighted, what has the Government done in this aspect? Has it provided any maintenance guideline or standard to the trade? Has it adopted any measure to prevent the mechanical parts responsible for the emission from being tuned arbitrarily? The Government emphasizes time and again that no regulatory authorities in the world can develop an effective maintenance programme for the light diesel vehicles and that as there is no effective maintenance programme, the ban on diesel will be the only prudential policy.

The Government's policy is somewhat like trimming the toes to fit the shoes. It shows that the Government is both incompetent and ignorant. I want to point out that in many states of the United States, various kinds of testing or maintenance schemes are in place. A research on light diesel vehicles has been carried out in Colorado which shows that effective testing and repairs will reduce the amount of particulates by 31%. Although these schemes may not be totally applicable to Hong Kong, they are at least important consideration before we can come up with any testing and repairs scheme applicable to Hong Kong. Unfortunately, we do not see any effort exerted by the Government in this aspect.

Mr President, I think the Government is aware that only diesel vehicles in bad repairs will lead to serious pollution problem. Why not examine the problem and formulate some stringent measures to compel proper testing and repairs rather than turning a blind eye to the installation of sub-standard spare parts in the diesel vehicles and the arbitrary tuning of oil pump of the diesel vehicles? Now the trade has proposed a repairs and maintenance scheme for the emission system in order to upgrade and tighten the repairs standard, which will also completely eradicate arbitrary tuning. Unfortunately, the Government thinks that it is not worth considering and insists its "clean-cut" approach, that is to eliminate all diesel vehicles of four tonnes and below. Other than that, no suggestion is accepted. Is this fair to the trade which is sincerely offering help to improve the air quality?

Finally, I would like to point out that the Government should review the proposed concessions and put forth real concessions rather than disguised ones. If the concessions are genuine, does it have to worry that the car owners are reluctant to switch to petrol? If some car owners voluntarily switch to petrol, the amount of suspended particulates emitted will be reduced to a certain extent. However, as not all fleets for business operation are forced to switch to petrol, our worry about emissions by petrol vehicles will be alleviated.

The suspended particulates emitted by diesel vehicles will be greatly reduced if multi-measures are adopted at the same time. These include the use of low sulphur content diesel, the implementation of stringent testing and repairs scheme, a voluntary diesel-to petrol concession scheme, as well as the tightening of the emission standard proposed by the Government. Furthermore, it will effectively reduce the amount of the other pollutants emitted by diesel vehicles. In the long term, the Government should proactively consider the use of other fuels, such as natural gas or LPG, which have been proved to be more environmental friendly.

Mr President, the Honourable IP Kwok-him, at the joint meeting of the Panel on Environmental Affairs and the Panel on Transport, described the diesel-to-petrol scheme as somewhat like "resisting a tiger at the front door but letting a wolf creep in from the rear door". However, the Government thinks that they are not only resisting a tiger and a wolf but also bringing in a tame cat. I hope the Government will not be over-excited and open the door too early before it has confirmed that it is really a cat and not in fact a leopard.

Mr President, with these remarks, I beg to move. Question on the motion proposed.

PRESIDENT: Miss Christine LOH has given notice to move an amendment to the motion. Miss LOH's amendment has been printed on the Order Paper and circularized to Members. I propose to call on her to speak and to move her amendment now so that Members may debate the motion and the amendment together.

MR TSANG KIN-SHING (in Cantonese): Mr President, on 26 September this year, a strike took place involving 800 Thai workers of the Route 3 and airport projects over wage deductions. From that day, until November this year, there were altogether seven cases in which the wages of the foreign workers of the new airport projects had been deducted. More than 2 000 workers, representing half of the total number of foreign workers in the new airport projects, were involved in these cases. They were Filipinos, Thais and Chinese by race. I do not wish to argue with the Secretary for Education and Manpower over what he said earlier about China, but in fact the countries involved included the Philippines and Thailand.

I have taken an active part in dealing with the wage deduction cases involving foreign workers, helping them fight for their reasonable interests. In the course of my involvement, I have come to understand that this is a modern version of the story of marketing labour to be exploited. I think that our policy of importation of labour has attracted workers form nearby countries to Hong Kong, only to be exploited by various parties. They might have regretted coming to Hong Kong, but they still could not avoid paying back the debts owed to the so-called labour affairs companies an other persons in their native countries. This is because they are bound by contracts into which they have entered. In the circumstances, they have no choice but to bear with the exploitation and work patiently.

Such were not cases which happened in the 19th century when Chinese labour was marketed to San Francisco to be exploited as railway workers. They actually happened in the 20th century in connection with the Airport Core Programme of Hong Kong. As a citizen of Hong Kong, I think that is really shameful.

The Democratic Party is of the opinion that wage deductions are directly related to the implementation of the policy of the importation of labour. The present circumstances have shown that the Government is not able to control the incidents of exploitation. In view of this, we think that the Legislative Council should follow up the cases and inquire into the matter so as to do justice to the people of Hong Kong and review the work done by Government departments.

The Democratic Party thinks that an inquiry into the cases of wage deductions should be conducted without further delay. The Secretary for Education and Manpower said that it would take three months, but we can imagine what the situation would be during the Chinese New Year holidays in Hong Kong in about a month's time. Many of construction sites will be closed and it is common for workers, especially the Chinese workers, to return home for the holidays. However, many people are worried that they cannot come back to Hong Kong after they have returned home. In the past, workers who had gone on strike were repatriated from Hong Kong to their native countries by the so-called labour affairs companies. Therefore, the Democratic Party urges the Legislative Council to invoke the Legislative Council (Powers and Privileges) Ordinance to conduct an open inquiry into the matter. This will not only serve to redress the grievances of the foreign workers, but also make the people of Hong Kong more aware of the loopholes of the policy of the importation of labour and of the role of the Government. The Democratic Party will take an active part in the inquiry, so as to find out the truth and do justice to the people of Hong Kong.

The Democratic Party hopes that Members of this Council will take the same stance and lend their full support to the Panel on Manpower to invoke the Legislative Council (Powers and Privileges) Ordinance to conduct the inquiry.

These are my remarks.

DR PHILIP WONG: Mr President, as a member of the Airport Authority, I wonder if I should declare interest. Can you give a ruling? And if so, may I have your permission to vote?

PRESIDENT: I do not see any direct personal pecuniary interest involved.

MR IP KWOK-HIM (in Cantonese): Mr President, the recent incident of wage deductions concerning the foreign labour of the Airport Core Project has really aroused much public concern in Hong Kong. It is understandable that my colleagues in this Council have demanded to follow up the case by making an inquiry into the matter. The Democratic Alliance for the Betterment of Hong Kong (DAB) also agrees that the matter should be followed up.

We notice that the Chinese Government is very concerned about this incident of exploitation of the foreign labour. Mr ZHANG Liang-dong, Secretary for Economic Affairs of the Hong Kong and Macau Affairs Office, has said that in the 1990s of the 20th century, marketing of labour to be exploited which occurred about a century ago should not happen again. To tackle the present problems, including wage deductions and the poor living environment of the foreign labour, the department concerned in China is planning to set up an investigation unit which will first inquire into the labour affairs companies in the two provinces of Guangdong and Fujian. Last month, the central authorities also held a joint meeting in which a demand was made for the authorities of the two provinces of Guangdong and Fujian to find out the reasons for the strike of the foreign labour in Hong Kong and to submit a report to the central authorities. Furthermore, Mr TSANG Yuk-shing and Mr TAM Yiu-chung, Chairman and member of the DAB respectively, after meeting with the officials of the Secretariat for International Co-operation, Ministry of Foreign Trade, have been given to understand that the Chinese Government is planning to step up the control of the labour affairs companies by means of legislation in order to plug up the present loopholes of the administrative rules to control the companies.

Earlier, I heard the Government's commitment to inquire into the matter and to produce a report after three months which will identify the loopholes of the present operation of the Labour Importation Scheme of the Hong Kong Government, make suggestions of improvement and introduce ways to monitor the agents for the importation of foreign labour. The report will be submitted to the Legislative Council.

Now that both the Governments of China and Hong Kong have started making inquires into the matter, should this Council use resources at this time to serve an overlapping purpose? Or would it be more appropriate for us to consider whether to hold an inquiry after the Government has submitted the report in three month's time? These are my remarks.

MR FREDERICK FUNG (in Cantonese): Mr President, the Hong Kong Association for Democracy and People's Livelihood (ADPL) supports the Honourable LAU Chin-shek's motion because we think that, for many years, there has been much controversy in Hong Kong over the issue of the importation of foreign labour. Such an issue is by no means a recent one. During the past few years, we have expressed the concerns of the public and of Members of this Council and we have also given advice in this Council. On every occasion, the replies given by the Government in this Council was that things could be accomplished and there would be no problem, but problems have at last arisen. The recent disputes have provided us with an insight that despite all the information, data, methods of implementation and systems revealed by the officials, the Government has been unable to accomplish what they promised to accomplish. In any case, not enough has been done. As members of the Legislative Council, we have given our support to the work of the Government, we have allocated funds for the Government to do its work and we have also approved staff increase, especially in the Labour Department, to deal with the problems of foreign labour.

Now that problems have arisen, I think there are at least four points which we members of the Legislative Council have to attend to and which we have to find out more through the Panel on Manpower.

We demand the Panel be authorized to exercise powers and privileges. We wish to achieve the following:

  1. understand the whole issue, but we have to make it clear that we are not demanding to investigate the case. We have to understand what has happened and why things have come to this situation.
  2. We have to understand the system which the Government has established, because the operations in the past could neither give protection nor prevent such disputes form happening, thereby causing problems. We have to stress that we are only trying to understand the system but not to find out who is responsible and who should bear the responsibility.
  3. We want to understand the situation and the present system because we wish to give advice and make recommendations concerning the present system with a view to solving the present problems.
  4. We want to examine the problems with the Government's entire monitoring system over foreign labour so as to enable us to give advice accordingly.

Therefore, I do not understand why we should not try to understand the problems and make recommendations accordingly.

Earlier, the Secretary for Education and Manpower told us that government departments such as the Immigration Department and the police might be carrying out investigations and preparing reports and that they might even institute prosecutions. But will the work of the Panel affect them? I think it can be left for the Panel to decide in its meetings whether we should exercise the powers immediately or postpone the exercise of such powers after considering the reasons given by the Government and the prevailing circumstances. In the Alex TSUI's case, we did postpone the exercise of such powers. I notice that Members of the Legislative Council do not share the worries of the Government officials who think that we would, regardless of the correspondences, force the Government into a corner so that it cannot move at all.

Finally, I would like to mention one point. We would certainly welcome the great amount of efforts made by the Chinese Government and the local governments of China and we would certainly welcome the Democratic Alliance for the Betterment of Hong Kong to influence some of the policies of China through its many contacts and connections. But we think the Government of Hong Kong and the legislature of Hong Kong can handle local problems. As regards overseas problems, we think they should be dealt with by the overseas governments or the governments concerned. Coming back to the question, should the local Government and the local legislature deal with these problems? And do they have to deal with them? I think they should do so and have to do so. The more active the Chinese Government deals with the matter, the more active we should be because it is a matter of co-ordination. I do not think that such co-ordination should be left to the executive. Since the legislature has such powers and responsibilities, it should deal with the matter. I therefore support Mr LAU Chin-shek's motion.

MR JAMES TO (in Cantonese): Mr President, having taken part in two enquiries conducted by this Council through invoking the Legislative Council (Powers and Privileges) Ordinance, I would like to respond to the Secretary for Education and Manpower on some technical points.

The Secretary for Education and Manpower just now said that he was very worried. He even pointed out that the normal investigation would be hindered if witnesses were summoned by this Council to attend an enquiry held under the said Ordinance. He cited two concrete examples. Firstly, he pointed out that if the witnesses to be summoned to appear at a hearing of this Council were the same as those who had been summoned to a court or police station, then the outcome might be prejudiced should different testimonies were given on different occasions. However, the Secretary seemed to have failed to further explain what problem would be resulted from such discrepancies.

In response to the Secretary's opinion, I would ask a question: Should the same witness give two different statements, especially when he is under oath on both occasions? If two different statements are given by the same witness, then logically, whether he is a government official or a man in the street, the Government should investigate to see whether someone has committed perjury on some occasion. Further investigation might be needed. In such a case, it will not affect the appropriateness of the questions raised by the Legislative Council or a court of law. Moreover, there is safeguard provided by the Ordinance that evidence given at this Council cannot be availed of in any other legal proceedings, regardless of whether it is self-incriminating, unless the Attorney General is considering to prosecute the witness or this witness has committed perjury in an enquiry conducted by this Council. Logically, these are the exceptions. Other than that, the evidence given is not allowed to be used for other purposes. In the circumstances, the Council has to grasp all the facts which will be our basis for monitoring the Government or for future legislation purpose. Thus we do not see any reason why there will be adverse influence caused by summoning the same witnesses, who have testified in a court for the same incident, to attend this Council's enquiry.

Secondly, the problem is about the so-called premature release of documents. The Secretary did use the words "premature release of documents". Should there really be such a document whose influence is far-reaching, please do have confidence in the Legislative Council, as we have invoked the Ordinance on two previous occasions. Everybody knows that we will exercise caution and will seek a lot of legal advice before we invoke the Ordinance. Should there be any problem, I believe the Government will provide us with legal advice and will remind us of the possible implications on legal proceedings. At the same time, legal advisors of the Legislative Council will also advise us. I would emphasize that the enquiry conducted by this Council is really of different nature from investigations conducted by different departments or the law enforcing arms of the Government. What the Members want to do is to find out shortcomings within the system rather than with an eye to prosecute the law breakers by invoking the existing laws.

In the past, we had conducted an enquiry for the incident at Kwun Lung Lau. At that time, the Government was also investigating the incident. It was possible that some people might have to bear criminal or civil liabilities. Yet this Council was not stopped from conducting an enquiry by the Government for that reason. Furthermore, the Legislative Council has refrained from invoking this power in a number of important incidents. Whenever this power is invoked, prudence will be exercised. May I cite an example. Teargas was used by the Correctional Services Department or the police in two riots involving the Vietnamese boat people. It was said that deaths and severe injuries were caused. In these incidents, the Governor handled the situation in a wise manner because he was aware that these were important incidents catching the attention of the international community and might lead to disgrace to Hong Kong people. Thus, he immediately appointed some Justices of the Peace to look into the matters or commissioned an independent committee to investigate the incidents. But this time, the Government is handling the problem in a clumsy way. The Government should have responded by appointing an independent committee for this would at least earn more votes in this Council. However, if the Government insists that the problems with the system could be solved by referring the incident to the Immigration Department or the police, I believe no responsible Member will agree to it.

I must also point out that the Government's viewpoints as mentioned above should be rebutted. I hope Members will support this motion and work together to get down to the truth in order to avert unnecessary criticisms that Hong Kong will suffer because of this incident.

MR JAMES TIEN (in Cantonese): Mr President, the Liberal Party supports the Honourable LAU Chin-shek's motion. Our objectives may be the same in some aspects but different in other aspects. It is our common objective, however, to find out who are responsible for the wage deductions. We see eye to eye on this point. But from another point of view, Mr LAU may want to scrap the Importation of Labour Scheme for the New Airport and Related Projects or even all kinds of labour importation schemes through the conducting of this enquiry. From the point of view of the Liberal Party, we want to find out any shortcomings in this system and to see whether the employers, especially those foreign-based contractors, many have paid the wages but the wages do not go to the pocket of the workers. What we want to know is the problem within this process.

Mr President, the importation of labour scheme has been implemented in Hong Kong for a long period of time. Minor problems are inevitable. But in this incident, although the number of companies involved is small, the number of people affected is a great one, involving hundreds of people. In view of this, we want to know why this has happened. It is incredible that the internationally renowned contractors would illegally deduct wages from the workers. So we support the proposal of conducting a hearing in order to get a thorough understanding. Should there be any loopholes, we hope to improve upon them so that our labour importation scheme will continue to operate for the early completion of our new airport. Thank you, Mr President.

MR CHAN KAM-LAM (in Cantonese): Mr President, the public is undoubtedly discontented with the incident that wages of our imported workers have been withheld. Fortunately, the incident has almost been fully settled.

Although I do not have any strong view in regard to the Honourable LAU Chin-shek's motion, I must point out that should the Panel on Manpower be authorized to exercise such powers, we must exercise them with caution. Any attempt to override the investigation being conducted by the law enforcing departments or to abuse the powers and privileges enjoyed by the Legislative Council will be improper.

In my opinion, the Panel on Manpower should respect the independence of the government department in conducting the investigation concerned.

Thank you, Mr President.

MR MICHAEL HO (in Cantonese): Mr President, the Secretary for Education and Manpower had just now emphasized time and again in his speech that it would be unnecessary for this Council to conduct an inquiry. He also told us that the Government was investigating the matter, repeatedly saying that our inquiry might affect the normal procedures and obstruct the investigation. Moreover, the Secretary also mentioned that the Immigration Department would find out in how many of the cases had offences actually been committed. Here I would like to point out that the Immigration Department will only be inquiring into cases which have contravened the Immigration Ordinance and the Labour Department's investigation will mainly be concerned with whether anyone has contravened the labour laws. A case which has neither contravened the labour laws nor the Immigration Ordinance may fall outside the terms of reference of the Immigration Department and the Labour Department.

I hope we can examine the whole system of importation of foreign labour and find out whether there are any shortcomings. That is the responsibility of the Legislative Council of Hong Kong towards the people of Hong Kong.

The Secretary for Education and Manpower said that its investigation might be affected if documents and evidence were prematurely disclosed. He mentioned many other similar presumptions. Mr President, I wish to tell the Government that it does not have to worry. In fact, we have already conducted two similar investigations. This legislature is one which works with reasons and we would certainly be careful, but we would also thank those who remind us to consider certain matters. Therefore, I wish to tell the Government to forget about the presumptions. We do appreciate that the staff of the Labour Department and the Immigration Department have made a lot of efforts and they have done a lot of hard work on the airport construction sites. Many of them have worked overtime, or have even worked so hard that they have become sick. I believe colleagues of this Council understand very well that these people have worked very hard.

Concerning the policy of importation of foreign labour, we realize that there have been incidents of exploitation. This clearly shows that there are problems in the monitoring mechanism. As a monitoring authority, we are responsible for problems in monitoring. Earlier today, I have spoken with some Government officials and they tried to convince us that this inquiry was unnecessary. They told us that even under a good system, there are bound to be people who would make use of the loopholes and exploit others, just like there would still be thieves even though we have the police. However, upon seeing the thieves, we would certainly question the authority responsible for security. Similarly, in this incident, no matter how well the mechanism has been designed, we will question what is the problem with the whole system and what is the problem with the monitoring system once incidents of exploitation have occurred. I am very pleased that investigation is being carried out by the Government as well as the Chinese Government. Although such investigation is somewhat overdue, it is better than nothing.

The Honourable IP Kwok-him said we could wait, but I think that my colleagues here who have become Members of the Legislative Council through elections are representatives of the people of Hong Kong. As such, we are responsible to sort matters out when there is a problem with the systems of Hong Kong. If we leave it to the Government to investigate and if we only invite the Chinese authorities and the Chinese Government to investigate, then we have not fulfilled our responsibilities.

Mr President, today I hope that my colleagues would lend their support to this motion so that we can invoke the Legislative Council (Powers and Privileges) Ordinance to inquire thoroughly into the matter to account to the public of Hong Kong.

These are my remarks.

MR LAU CHIN-SHEK (in Cantonese): Mr President, since the occurrence of the modern version of marketing labour to be exploited, my colleagues and I have mentioned time and again that this incident has brought shame on the people of Hong Kong. Talking about shame, I would like to tell Members that the shame brought on the Hong Kong people may be great or small. Some feel that it is abstract and others feel that it is concrete. Some feel that it may go on for just one or two days while others feel that it would last for a long time. However, considering the sufferings and unpleasant experience of the victims, that is the exploited foreign workers, the shame we face actually reminds us of our responsibility.

What has deeply impressed me is that almost all imported workers of the airport projects have told me that they regret having come to work in Hong Kong. I think you are well aware of the whole procedure and I am not going to repeat it. As we are confronted with this incident today, I would like to point out that many labour organizations have been complaining to the Government as well as some government-related organizations that there are many problems, such as illegal deductions of the wages of foreign workers. The Honourable Frederick FUNG has already given us details about this. But the Government told us that it had already done something to improve the situation and that we can set our mind at ease for there will be no problem. But just let us look at the result!

I want to point out that the problem exposed this time is not discovered by the Government. Not a single problem has been discovered by the Government. They are exposed by the imported workers themselves or by some labour organizations. The Secretary for Education and Manpower has said that what we propose to do would affect the prosecution process. But I would like to remind him that we also have legal advisors who will advise us what we should do. Moreover, the Panel will exercise great caution. But most importantly, as the Government is the policy maker as well as the organization which implements it, the Government itself is the root of the problem. The Government said that investigation had been completed, but is it all that it should do? I am not saying that investigation is not appropriate, but I think the Government should also allow this Council to conduct an objective and unprejudiced enquiry into this matter.

Finally, this incident reminds me of a Jewish friend who told me that when he was on his way back to Israel, he witnessed the miserable plight of the Palestinians. As a result, he decided to stay there to help them despite their political, religious or even economic and cultural differences. Today, confronted with the situation of these unfortunate imported workers in connection with the airport projects. Members of this Council are duty-bound to offer their help, regardless of our standpoint in politics, religions, cultural and economic issues, in the hope that such incidents will not occur again and that our policy can really be implemented in a fair manner.

Mr President, with these remarks, I would like to express my thanks to all Members, whether they will vote for or against my motion or will even abstain from voting.

Question on the motion put.

Voice votes taken.

THE PRESIDENT said he thought the "Ayes" had it.

Dr Philip WONG claimed a division.

PRESIDENT: Council shall proceed to a division.

PRESIDENT: I would just like to remind Members that they are now called upon to vote on Mr LAU Chin-shek's motion. Will Members please register their presence by pressing the top button in the voting units on their respective desks and then proceed to vote by pressing one of the three buttons below?

PRESIDENT: Before I declare the results, Members may wish to check their votes. Are there any queries? The result will now be displayed.

Mr Allen LEE, Mrs Selina CHOW, Mr Martin LEE, Mr SZETO Wah, Mr Edward HO, Mr Ronald ARCULLI, Mrs Miriam LAU, Mr Albert CHAN, Mr CHEUNG Man-kwong, Mr Frederick FUNG, Mr Michael HO, Dr HUANG Chen-ya, Miss Emily LAU, Mr LEE Wing-tat, Mr Fred LI, Mr Henry TANG, Mr James TO, Dr YEUNG Sum, Mr Howard YOUNG, Mr WONG Wai-yin, Miss Christine LOH, Mr James TIEN, Mr LEE Cheuk-yan, Mr CHAN Wing-chan, Miss CHAN Yuen-han, Mr Andrew CHENG, Mr CHENG Yiu-tong, Mr Anthony CHEUNG, Mr Albert HO, Mr LAU Chin-shek, Dr LAW Cheung-kwok, Mr LAW Chi-kwong, Mr LEE Kai-ming, Mr LEUNG Yiu-chung, Mr Bruce LIU, Mr MOK Ying-fan, Miss Margaret NG, Mr SIN Chung-kai, Mr TSANG Kin-shing, Dr John TSE, Mrs Elizabeth WONG and Mr YUM Sin-ling voted for the motion.

Mr CHIM Pui-chung, Dr Philip WONG, Mr CHOY Kan-pui, Mr David CHU, Mr Ambrose LAU and Mr LO Suk-ching voted against the motion.

Dr LEONG Che-hung, Mr Eric LI, Dr Samuel WONG, Mr CHAN Kam-lam, Mr IP Kwok-him and Mr NGAN Kam-chuen abstained.

THE PRESIDENT announced that there were 42 votes in favour of the motion and six votes against it. He therefore declared that the motion was carried.

PRESIDENT: I have accepted the recommendations of the House Committee as to the time limits on speeches for the motion debates and Members were informed by circular on 11 December. The movers of the motions will have 15 minutes for their speeches including their replies and another five minutes to speak on the proposed amendment. Other Members, including the mover of the amendment, will have seven minutes for their speeches. Under Standing Order 27A, I am required to direct any Member speaking in excess of the specified time to discontinue his speech.

REDUCTION OF EMISSIONS FROM DIESEL VEHICLES

MRS MIRIAM LAU

to move the following motion:

    "That this Council supports that measures be taken to reduce emissions from diesel vehicles, but as both petrol and diesel vehicles attribute to air pollution and before it can be confirmed which one of the two types of vehicle is more environment-friendly, urges the Government to review the mandatory scheme of phasing out diesel vehicles of four tonnes or below in the consultation paper "Further Proposals to Reduce Emissions from Diesel Vehicles" and to replace the proposed scheme with incentive measures to attract owners of diesel vehicles to change to petrol vehicles on a voluntarily basis, as well as to expeditiously explore other measures which are more effective and generally accepted by the public, in order to improve the air quality in the territory."

MRS MIRIAM LAU (in Cantonese): Mr President, I move the motion standing in my name as set out in the Order Paper.

In September this year, the Government published a consultation paper which proposes the diesel-to-petrol scheme offering concessions to the trade in order to encourage operators of diesel vehicles of four tonnes or below to switch to petrol. Apart from that, stringent emissions controls against heavy diesel vehicles will be exercised. It is considered that the public and the trade would welcome the Government's endeavours to improve air quality, to protect the public health and to cope with the loss that the operators of diesel vehicles may suffer under this scheme, but ever since the commencement of the consultation period has begun, different opinions have been aired and no unanimous conclusion could be drawn. What is more, voices of opposition from the affected trade is lingering in our ears.

The ultimate purpose of my motion today is the in line with the Government's objective, that is, to improve the air quality of Hong Kong and to protect public health.

The Government has been warning that the respirable suspended particulates (RSP) emitted by vehicles running on diesel is often exceeding the acceptable level and RSP may lead to various kinds of respiratory illnesses and even cancer. The Government also quoted a report from a United Kingdom newspaper that the RSP has caused death of tens of thousand of people a year. It seems to imply that those who do not support the Government's proposal should be held responsible for the death of these people.

In fact, the RSP is only one of the numerous harmful substances emitted by vehicles. Emissions by diesel vehicles contain more particulates and nitrogen oxides, while emissions by vehicles running on petrol contain more carbon monoxide, carbon dioxide, and benzene, which may cause cancer. Since the diesel vehicles and petrol vehicles emit different pollutants which are harmful to the environment and posing a health hazard to us, some academics find that there is no clear conclusion whether diesel or petrol is more environmental friendly.

However, it is the Government's foregone conclusion that petrol is more environmental friendly than diesel. The Government admits that by switching to petrol harmful pollutants in the air will increase but insists that such pollutants can be kept at a safety level. Unfortunately, apart from some homemade charts explaining the Government's views, there is no further substantiation such as academic report and research literature to support its argument or to rebut the academics' conclusion drawn from their study.

If other pollutants are ignored and only suspended particulates are the only pollutant to be dealt with, the Government can feel justified and confident to target at diesel vehicles. However, according to a research report by the Hong Kong Polytechnic University, the emissions of taxis and public light buses in the busiest areas only account for 23.5% of the particulates found in those areas. Besides, according to another research report by the Hong Kong University, particulates emitted by heavy vehicles and big buses account for a great proportion while particulates emitted by taxis and small buses only account for a small proportion.

These two research reports have coincidentally pointed out that the main culprit of emitting a large amount of particulates is not taxis, small buses or light diesel vehicles. However, the Government is targeting at diesel vehicles of four tonnes or below and force them to switch to petrol. What the Government is doing is obviously putting the cart before the horse and reflects that it lacks a sense of proportion.

Even though the Government's proposal can really lead to reduction of suspended particulates in the air, can the people breathe fresh air once the proposal is implemented? Certainly not, because when the problem of suspended particulates has been solved, another pollution problem will emerge. After the diesel vehicles have switched to petrol, the number of cars running on the road will not decrease. In the future, there will be the same number of petrol vehicles running the same mileage that the diesel vehicles are now running. Harmful emissions will also be produced by these vehicles. If suspended particulates may cause death, carbon monoxide and benzene are also lethal, though the cause of death is different.

The Government has emphasized time and again that all problems can be resolved once petrol vehicles are fitted with catalytic converters. But will all pollutants emitted by petrol vehicles disappear? Certainly not. The Government also admits that some air pollutants will increase, but nevertheless will be kept within the safety level. Although mandatory renewal of catalytic converters will be part of the Government's proposal, no one can guarantee that catalytic converters will not be out of order. Neither is there any research to show that the performance of catalytic converters will not be affected even after they have become worn out. If the catalytic converters do not perform satisfactorily or if it has totally failed, the harmful emissions produced by petrol vehicles will be more lethal than the emissions produced by diesel vehicles as the former can kill without any trace.

Mr President, the Government has proposed fuel duty concessions, reduction of the annual licence fees for vehicles and the first registration tax in order to lower the operating costs of the taxis, public light buses and small school buses. Yet these concessions are provided only during the first 10 years.

Under the veil of concessions in order to attract the taxis and public light buses to switch to petrol, these are in fact mandatory measures which induce the drivers into a snare who will then find themselves reap the benefits first and then bear the hardships later. Like it or not, the diesel vehicle owners have to switch to petrol as soon as possible, otherwise, they have to bear a substantial increase in licence fees. Operators of light vans will suffer most because they will not enjoy any concession as the Government is of the opinion that these operators can absorb the extra cost with their clients and fuel constitutes a small proportion of transport costs. I really cannot understand the logic behind the Government's argument. Taxis and public light buses can enjoy concessions so that their customers, that is the passengers, can benefit, but the clients of the light vans cannot. In fact, not all light vans are owned by large companies, most of the light van owners are self-employed. The current proposal of the Government will directly affect their livelihood.

On the other hand, the Government does not agree that increase in the annual licence fee for vehicles which continue to stay on diesel is a punitive measure. It said that it was necessary to raise the operating costs of the diesel vehicles in order to be fair to other vehicles which have switched to petrol. The Government's argument is just like saying that if A is robbed of $10, then B must be robbed of $10 in order to be fair to A. This is a novel sort of "fairness" put forth by the Government.

Obviously what the Government is going to provide is not real concessions. The diesel vehicle owners now pay less fuel duty, which will be increased by the Government in the future. The Government will not incur any fiscal loss but the public will suffer when the concession period is over in 10 years' time, operating costs of petrol vehicles will increase as fuel duty also increases. Eventually the extra cost will be shifted onto the commuters who have to pay a fare higher than that of other public transport running on diesel.

The public do not mind paying higher fare in order to enjoy fresher air. But if the fare increase is not as moderate as the Government has estimated and the fuel is not as environmental friendly as the Government has expected, will the public be willing to support an expensive but not effective scheme?

In regard to the operating costs, which include both the costs of maintenance and fuel, of taxis and public light buses running on petrol, there are discrepancies between the estimation by the Government and by the trade. If the trade's estimation is correct, then the current proposal of the Government will indeed deal a heavy blow to the trade and jeopardize the future development of the trade.

The trade is worried that after switching to petrol, the performance of the vehicles will be worse than diesel vehicles and will no longer suitable to the road situation in Hong Kong. Despite that, the Government points out that in many American cities such as New York, petrol taxis run a longer mileage than Hong Kong taxis. It further argues that as taxis in these foreign countries can run on petrol, there is no reason why it is not feasible in Hong Kong.

I would like to ask the Government some questions: Are taxis in Hong Kong operated in the same way as the taxis in New York? Are the road situations in these two cities the same? Do they have the same climate and geographical environment? If the answer is no, how can the Government conclude that the foreign model can apply to Hong Kong? Since there are discrepancies between the estimated operating costs presented by the trade and the Government's estimate, and the foreign model may not be applicable to Hong Kong, why not the Government conduct an experiment to compare the performance of a diesel taxi and a petrol taxi. Only in so doing will the data obtained can truly reflect the discrepancies in operating costs by running on diesel and petrol and prove that the fare increase will be as moderate as the Government has expected. Most importantly, we have to obtain data which are acceptable and trusted by the public and the trade.

Mr President, as I have raised so many questions on the effectiveness of the Government's proposal, this may lead some to query whether I am urging the Government to stop doing anything and allow the worsening of our air quality. Certainly not. I must reiterate that I share the objective of the Government and the environmentalists: to show our determination to improve the air quality by our acts.

The current proposal put forth by the Government is exactly what Dr BARRON of the Hong Kong University has suggested. He recommends that all light vehicles should run on petrol and tighter emission controls and testing should be imposed on heavy vehicles. However, Dr BARRON also agrees that there is another alternative as suggested by Dr RUSCO and Dr WALLS of the Hong Kong University: to use high quality diesel and upgrade the emission standard of new vehicles. In addition, maintenance should be upgraded in order to reduce the amount of pollutants, including suspended particulates, emitted by all diesel vehicles. Dr RUSCO and Dr WALLS are of the opinion that their suggestion is more effective but less expensive than Dr BARRON's.

Thus we are facing many alternatives rather than either "death" or the Government's proposal as it warns. In fact, we do not come to the end of a blind alley, for there are many viable routes to take.

According to a research conducted by the Hong Kong Polytechnic University, if all taxis and public light buses have switched to petrol, the total amount of suspended particulates and RSP will be reduced by 12% and 18%. However, if low pollution diesel is used, the respective figures will be 8% to 10% and 12% to 15%.

The report by Dr RUSCO and Dr WALLS also points out that by switching to quality diesel of low sulphur content, emissions will be reduced by 25%, and the particulates and nitrogen oxides emitted will be reduced by 22.5% and 21.7% respectively. A report by the Hong Kong University of Science and Technology has quoted an overseas experiment result that a 0.25% to 0.05% reduction in sulphur content will lead to 70% reduction in suspended particulates emitted.

It is clear that the use of low sulphur content diesel will reduce the emissions of diesel vehicles, including suspended particulates. Moreover, we will get an instantaneous and overall improvement in air quality. In fact, the Government has planned to introduce 0.05% sulphur content diesel in April 1997 and the effect is yet to be seen. But now the Government is trying to implement a costly but ineffective policy. It is hardly convincing. In fact, what the Government should do now is to introduce low sulphur content diesel at an earlier date and further lower the sulphur content of diesel.

The use of low sulphur content diesel should be accompanied by a proper testing and maintenance scheme in order to ensure that emissions by diesel vehicles do not exceed the standard required. As early as 1991, Dr BARRON pointed out that the root of air pollution in Hong Kong is that no one can guarantee that the engine of diesel vehicles are correctly tuned. Although the problem has been highlighted, what has the Government done in this aspect? Has it provided any maintenance guideline or standard to the trade? Has it adopted any measure to prevent the mechanical parts responsible for the emission from being tuned arbitrarily? The Government emphasizes time and again that no regulatory authorities in the world can develop an effective maintenance programme for the light diesel vehicles and that as there is no effective maintenance programme, the ban on diesel will be the only prudential policy.

The Government's policy is somewhat like trimming the toes to fit the shoes. It shows that the Government is both incompetent and ignorant. I want to point out that in many states of the United States, various kinds of testing or maintenance schemes are in place. A research on light diesel vehicles has been carried out in Colorado which shows that effective testing and repairs will reduce the amount of particulates by 31%. Although these schemes may not be totally applicable to Hong Kong, they are at least important consideration before we can come up with any testing and repairs scheme applicable to Hong Kong. Unfortunately, we do not see any effort exerted by the Government in this aspect.

Mr President, I think the Government is aware that only diesel vehicles in bad repairs will lead to serious pollution problem. Why not examine the problem and formulate some stringent measures to compel proper testing and repairs rather than turning a blind eye to the installation of sub-standard spare parts in the diesel vehicles and the arbitrary tuning of oil pump of the diesel vehicles? Now the trade has proposed a repairs and maintenance scheme for the emission system in order to upgrade and tighten the repairs standard, which will also completely eradicate arbitrary tuning. Unfortunately, the Government thinks that it is not worth considering and insists its "clean-cut" approach, that is to eliminate all diesel vehicles of four tonnes and below. Other than that, no suggestion is accepted. Is this fair to the trade which is sincerely offering help to improve the air quality?

Finally, I would like to point out that the Government should review the proposed concessions and put forth real concessions rather than disguised ones. If the concessions are genuine, does it have to worry that the car owners are reluctant to switch to petrol? If some car owners voluntarily switch to petrol, the amount of suspended particulates emitted will be reduced to a certain extent. However, as not all fleets for business operation are forced to switch to petrol, our worry about emissions by petrol vehicles will be alleviated.

The suspended particulates emitted by diesel vehicles will be greatly reduced if multi-measures are adopted at the same time. These include the use of low sulphur content diesel, the implementation of stringent testing and repairs scheme, a voluntary diesel-to petrol concession scheme, as well as the tightening of the emission standard proposed by the Government. Furthermore, it will effectively reduce the amount of the other pollutants emitted by diesel vehicles. In the long term, the Government should proactively consider the use of other fuels, such as natural gas or LPG, which have been proved to be more environmental friendly.

Mr President, the Honourable IP Kwok-him, at the joint meeting of the Panel on Environmental Affairs and the Panel on Transport, described the diesel-to-petrol scheme as somewhat like "resisting a tiger at the front door but letting a wolf creep in from the rear door". However, the Government thinks that they are not only resisting a tiger and a wolf but also bringing in a tame cat. I hope the Government will not be over-excited and open the door too early before it has confirmed that it is really a cat and not in fact a leopard.

Mr President, with these remarks, I beg to move. Question on the motion proposed.

PRESIDENT: Miss Christine LOH has given notice to move an amendment to the motion. Miss LOH's amendment has been printed on the Order Paper and circularized to Members. I propose to call on her to speak and to move her amendment now so that Members may debate the motion and the amendment together.

MISS CHRISTINE LOH's amendment to MRS MIRIAM LAU's motion:

    "To delete "but as both petrol and diesel vehicles attribute to air pollution and before it can be confirmed which one of the two types of vehicle is more environment-friendly," and substitute with "and"; to insert "public response to" after "the Administration to review"; to delete the word "mandatory"; to delete "replace" and substitute with "amend"; to delete "with incentive measures to attract owners of diesel vehicles to change to petrol vehicles on a voluntarily basis, as well as to expeditiously" and subsitute with "to make it as widely acceptable as possible to the public and owners of diesel vehicles, including reconsideration of the proposed principle of revenue neutrality by agreeing to plough back any possible revenue so acquired into health care development and, to continue to"; and to delete "which are more effective and generally accepted by the public,"."

MISS CHRISTINE LOH: Mr President, I move that Mrs Miriam LAU's motion be amended as set out under my name in the Order Paper. I want to explain, first of all, why I am seeking an amendment to Mrs LAU's motion.

I believe Mrs LAU has based her motion on the wrong premise. The motion states that "both petrol and diesel vehicles attribute to air pollution". No problems there. But the motion goes on to say that "before it can be confirmed which one of the two types of vehicle is more environmentally-friendly", the Administration should not insist on a mandatory scheme to switch from diesel to petrol vehicles.

You could say that neither of the vehicle types are environmentally-friendly since they both emit harmful pollutants. Further, the exhaust compositions of the two types of vehicles are inherently different. Thus, to phrase the motion in terms of their comparative environmental-friendliness is misguided.

A more useful focus for this Council to assess the public health benefits of the proposed scheme, is the Air Quality Objectives which Hong Kong has set for itself. Regrettably, our air quality is consistently failing to meet them, especially for respirable suspended particulates (RSP). It is not in dispute that the adverse health effects of RSP include serious respiratory and cardiovascular illnesses, with the elderly and children being the most susceptible. Recent international studies show that RSP may be the most worrisome air pollutant in the urban environment.

The biggest culprit for the emission of RSP right now in Hong Kong is the diesel fleet. The Hong Kong Polytechnic University study, commissioned by the Taxis and Public Light Buses Concern Committee, does not actually dispute this.

What is surprising about the study, is that it does not point out the obvious, that is, that RSP is the pollutant that consistently, and by a large margin, fails the Air Quality Objectives. I am mystified why the study spends 40 pages on air pollution and vehicle emissions and skirts around the issue of the Air Quality Objectives? Furthermore, the study does not tell us by how much our air quality will improve if Hong Kong does as it suggests by adopting a better maintenance scheme for small diesel vehicles, and drop the proposed diesel to petrol scheme. This is surely, Mr President, a significant and an incomprehensible omission.

Mr President, there should be no dispute that RSP is the single greatest air pollution threat to public health today in Hong Kong. Thus, there should be no dispute that we need to address RSP urgently and reliably.

It is for this reason, urgency and reliability, that Hong Kong cannot wait for developing technologies, such as electric vehicles, to mature. The proposed diesel to petrol switch is underpinned by reliable technology. There is enough data both here in Hong Kong and around the world to assure us of the levels of improvement to our air quality that we can expect if the scheme were implemented.

I would only like to say that if the Administration gets to the state of drafting legislation, it should include in it periodic review to ensure that developing technologies will not be overlooked or discounted in future by Hong Kong having opted for the diesel to petrol switch scheme today.

In addition, since the scheme targets diesel vehicles below four tonnes, which causes the greatest air pollution in Hong Kong's most densely populated areas, the Administration must also continue to tighten control over larger diesel vehicles. Moreover, the Administration must do more to reduce nitrogen dioxide which also exceed the Air Quality Objectives. However, these are not reasons for holding back on the scheme overall.

Mr President, the rest of Mrs LAU's motion, which calls for the scheme to be a voluntary one, is hinged on the logic of comparative environmental-friendliness, which I hope to have shown is erroneous.

What my amendment proposes is simply that the Administration should review public responses to the scheme, which would of course include the views of the taxi and public light bus trade and those of other like vehicles, and to make the scheme "as widely acceptable as possible" to them and to the public.

The Environmental Affairs and the Transport Panels held two long unprecedented meetings to discuss with the trade and with government officials the two main issues of the proposed scheme. The first is on health, which I have already dealt with. The second one is the financial viability of the scheme.

In this regard, the calculations upon which the Administration based its various concessions to promote the scheme, and to ensure that the livelihood of the trade will not be adversely affected, are very different from those presented by the trade. I have already publicly criticized the Administration before for not consulting the trade prior to the publication of its consultation paper. If the Administration cannot come to some agreement with the trade on them, then the scheme will not succeed, whether it be a mandatory or a voluntary one.

The Administration's response to the lack of prior consultation is that it would not have been able to get the consultation paper out on time. The Administration wants to only consult the trade now. The problem here is that the Administration has lost the trust of the trade, whose co-operation is crucial for the success of the scheme.

I would also like to call on the trade to now sit down however with the Administration to compare their calculations. The Administration should give an unequivocal undertaking here that if its calculations are wrong, that it will review the various concessions to ensure that the livelihood of the trade will not suffer.

The last point I want to make is on the issue of revenue neutrality. The Administration advises that its initial revenue loss in implementing the various concessions is expected to be around $485 million in the first five years. But since petrol consumption will correspondingly increase, that will create a surplus of about the same amount.

Mr President, if the Administration has to increase its concessions to make the scheme work, then I suppose there could well be a revenue loss. This prospect should not, however, hold the Administration back since public health is imperative.

At the other end of the spectrum, it could be that the Administration would end up making some sort of a greater surplus than they have calculated for. If that were the case, then what I propose in my amendment is that the revenue should be plowed back into health care development preferably, directly to deal with the air pollution.

Mr President, I urge Members to support my amendment.

Question on the amendment proposed.

MRS SELINA CHOW (in Cantonese): Mr President, I believe every one of us looks forward to an environment with fresh air and a wholesome body. Unfortunately, modernization brings only materialistic improvements. The quality of life has, however, deteriorated. This is due to the worsening problem of environmental pollution, a topic we are debating today. Therefore, I am in full support of tackling the problem of car emissions. Nevertheless, I must ask: Do we need to hastily propose, as the Government does, draconian measures to lay down rules to make it mandatory for vehicles to use of petrol in place of diesel?

Who should be responsible for the present problems? The culprit could be those owners of smoky cars who never keep their cars in good repair. The Government is in fact the accomplice, guilty of laxity in law enforcement. It has failed to set up a mechanism to ensure that cars on the roads are adequately maintained and overhauled to meet environmental requirements.

From the point of view of environmental protection, the Environmental Protection Department (EPD) has never in the past done anything concrete to reduce the amount of respirable suspended particulates (RSP) in car emissions. Just take a look at the chart given to us by the EPD the day before yesterday and we can see that if the Government had adopted the proposed administrative controls, the RSP pollution index could have been lowered by 20%, even in the absence of any diesel-to-petrol conversion measures. How come the Government did not take any action in the past but in the face of a worsened situation, it has now decided to take drastic measures to ban the use of diesel?

Why does the Government have to wait until 1997 to introduce a reduced sulphur content of 0.05% in diesel when most places in the world have already adopted the same? Furthermore, while some foreign countries are already exploring the possibility of further reducing the sulphur content of 0.01%, why does Hong Kong appear to have lagged behind in this regard? How come Hong Kong continues to tolerate a high level of sulphur content while at the same time tries to take on an avant-garde position by banning the use of diesel oil?

Now that the RSP pollution index may be reduced by 20% through administrative control, has the EPD ever tried to find out how to further improve this percentage?

Mr President, in the course of this Council considering the Government's proposed diesel-to-petrol scheme, I have queried the relevant departments for going to the abstruse and forgetting the obvious. When the relevant Panel discussed the proposal, the Government obviously had not taken practical measures to improve vehicle emission standards, to introduce suitable maintenance requirements or to prosecute the polluters. Nor had it assessed the effectiveness of all of these steps to ascertain whether they can solve most of the problems. The Government started to make comparisons only when Members insisted that it did so. Is this not an obvious instance of lacking in objectivity and a sense of priority on the part of the Government?

The Honourable Mrs Miriam LAU has pointed out clearly the views of the trade on the proposal and she has even analysed such views from an economic angle. In terms of attitude, I am very much dissatisfied with the position held by the Transport Department (TD) in conducting the consultation. I am more so with the fact that this time Members were obviously swamped with numerous data from the TD and from the trade. Members were therefore at a loss as to who to believe although they could in fact have been able to obtain objective data in considering the relevant policy. The Government could say the data from the trade are for its own interests. But are the data from the TD and EPD not geared to give support to the Government policy? To maintain its credibility, the Government has to be fair and neutral and it has to tell the truth. If the TD finds some part of the data provided by the trade hard to understand, it should spend some time to discuss with the trade in a patient manner in order to unearth some trustworthy data for Members to look at before they make a decision.

Without having done its part, the Government hurried to put forward a strongly worded proposal in its present form. This is an ostrich policy, or rather this is like furthering self-interest by hurting others, which, I think, is a more appropriate phrase to