Provisional Legislative Council

PLC Paper No. CB(2) 814
(These minutes have been
seen by the Administration)

Ref : CB2/PL/CA

Provisional Legislative Council
Panel on Constitutional Affairs

Minutes of the special meeting held on Tuesday, 25 November 1997 at 8:30 a.m. in the Chamber the Legislative Council Building

Members Present:

Hon Andrew WONG Wang-fat, JP(Chairman)
Hon TSANG Yok-sing (Deputy Chairman)
Hon Bruce LIU Sing-lee
Hon Ambrose LAU Hon-chuen, JP
Hon KAN Fook-yee
Hon CHOY So-yuk

Members Absent :

Hon James TIEN Pei-chun, JP
Hon David CHU Yu-lin
Hon Mrs Elsie TU, GBM
Hon CHENG Kai-nam
Hon Kennedy WONG Ying-ho
Hon CHIM Pui-chung

Members Attending :

Hon Ronald ARCULLI, JP
Hon CHAN Wing-chan
Hon CHAN Kam-lam
Hon IP Kwok-him

Public Officers Attending :

Mr Michael SUEN M Y
Secretary for Constitutional Affairs

Mr Robin IP
Deputy Secretary for Constitutional Affairs

Mr Patrick HO
Principal Assistant Secretary for Constitutional Affairs

Mr James O'NEIL
Principal Government Counsel (Elections)

Clerk in Attendance :

Mrs Percy MA
Clerk to Panel

Staff in Attendance :

Mrs Justina LAM
Assistant Secretary General 2

Miss Flora TAI
Senior Assistant Secretary (2) 3

I.Meeting with the Administration

1998 Legislative Council (LegCo) Election : Election Expenses Limits
(PLC Paper No. CB(2) 658(01))

At the invitation of the Chairman, Secretary for Constitutional Affairs (SCA) briefed members on the preliminary proposals in respect of election expenses limits for the 1998 LegCo election.

Geographical Constituencies (GCs)

2.SCA said that the Administration had taken into account various factors in proposing election expenses limits for lists of candidates for the 1998 LegCo geographical elections, namely, the substantial increase in the population size and geographical size of GCs, changes in the electoral system, inflation rate and the need to allow for flexibility in election spending by the candidates. The number of electors was also expected to increase substantially as a result of the upcoming voter registration campaign. Assuming all eligible persons (about 4 million) were registered, the number of electors for each of the 20 GC seats would be 200,000. If a $500,000 ceiling on election expenses was set for each seat, the amount spent on each elector was only about $2.5 which was considered reasonable.

3.SCA then drew members' attention to Annex C to the information paper concerning election expenses limit applied to individual candidates on a list. Members noted that under the List system, the limit for a candidate on a list would be the effective limit for the entire list. A candidate on the list or his agent must obtain a written authorization from all other candidates on the list before incurring any election expenses after formation of the list. A candidate was required to submit a detailed return of election expenses after the election, including election expenses incurred before formation of the list. Mr TSANG Yok-sing then asked and SCA responded that the initial thinking was that candidates would be allowed to adjust the authorized amount provided the total election expenses limit for the list would not be exceeded.

Election expenses limit

4.Members in general did not object to the Administration's proposal of setting the election expenses limits on the basis of list of candidates instead of individual candidates. However, most members present had strong views on the drastic increase in the election expenses limit, i.e. from $200,000 in respect of a single-seat GC in the 1995 LegCo election to $500,000 for each seat in the 1998 LegCo geographical elections as it would not provide a level playing field for all candidates. Concern was expressed that the proposed increase would be to the disadvantage of independent candidates and grassroots parties because candidates and political parties who were financially better-off could afford to print more attractive publicity materials and organize a wider variety of campaigning activities. Mr Bruce LIU remarked that the Administration's proposal would encourage money politics

5.SCA pointed out that most of the candidates in the 1995 LegCo geographical elections had spent more than 90% of the election expenses limit. This gave rise to questions as to whether the limit for the 1995 elections was adequate. On the other hand, Mr IP Kwok-him and Mr Bruce LIU expressed reservations about the proposed increase, especially when election expenses could be shared among candidates on a list in the 1998 LegCo election.

6.SCA emphasized that $500,000 was a maximum limit and did not restrict the way in which a candidate ran his campaign. Candidates were free to spend as much or as little as they liked, provided they stayed within the prescribed limit. Some members pointed out that a candidate would be inclined to spend as much as possible under the limit in order to be competitive with other candidates in the same constituency.

7.In further response to members, SCA said that election expenses of $2.5 per elector was not excessive in comparison with election expenses limits in previous elections. He disagreed with some members' view that candidates who were financially better-off would be in an advantageous position to canvass more votes by spending more in their campaign. He opined that the primary consideration of an elector in his voting choice was a candidate's political platform and ability. SCA reminded members that the LegCo election would be conducted with a high degree of transparency as there were stringent regulations governing electioneering activities such as -

  1. election advertising on radio and television was prohibited;

  2. approval had to be sought for mounting banners and signboards on the streets and balloting was required for certain designated locations;

  3. offering any advantage to a person e.g. giving a feast for the purpose of vote canvassing was illegal under the Corrupt and Illegal Practices Ordinance (Cap. 288) ; and

  4. candidates were required to submit a return on donations to the Electoral Affairs Commission providing detailed information which must show the source and the amount of donations not less than $500.

8.Some members remarked that it was unrealistic for the Administration to expect that a 100% registration rate of 4 million electors would be achieved. Mr Bruce LIU asked whether the Administration would consider lowering the election expenses limit if the number of registered electors fell below the expectation of 4 million. SCA responded that even if the number of registered electors was lower than expected e.g. 3.6 million, the amount of election expenses per elector, calculated on the basis of the proposed ceiling of $500,000 per seat, would only be about $2.7. This was still considered acceptable.

9.Mr Bruce LIU maintained that the election expenses limit per seat for the 1998 election should be set having regard to election expenses limit of the 1995 LegCo geographical elections, the inflation rate since the 1995 LegCo election and the actual number of registered electors for the 1998 LegCo election. At Mr LIU's request, SCA agreed to provide information on the average election expenses incurred per elector in the 1995 LegCo geographical elections and a projection of election expenses limit per seat on the basis of different voter registration rates. Adm

10.While most members present at the meeting found the proposed election expenses limit excessive, Mr Ambrose LAU and Ms CHOY So-yuk considered the proposal to be reasonable. They were of the view that a reasonable limit should be set to enable candidates to run the campaign effectively. Ms CHOY further asked whether the proposed limit of $500,000 was sufficient for candidates who were newly involved in politics or who were not affiliated with any political parties as they might need more resources to make themselves known to electors. In response, SCA said that the Administration considered the proposed limit reasonable, and it would apply across-the-board to all candidates in geographical elections. Newcomers would naturally have to put in more efforts in order to gain popularity with electors.

Overseas practices

11.In response to Mr Ambrose LAU's enquiry, SCA informed members that the Administration had made reference to overseas practices in proposing the election expenses limits. The election expenses limits per elector in Spain, Singapore and Canada varied from about HK$2.5 to $12.3 and that some other countries did not set election expenses limits but imposed restrictions on donations or ways in which a candidate ran his campaign. However, SCA stressed that overseas practices were for reference only and that Hong Kong should strike the right balance in setting a limit having regard to its own circumstances. Mr LAU then asked about the practice in advanced democratic countries. SCA said that in respect of the presidential elections in the United States, no election expenses limit was set, but there were stringent restrictions on political donations.

Liability for exceeding the limit

12.As election expenses limit was set for a list, Mr KAN Fook-yee asked whether strict liability would apply to candidates on the list who had benefited as a result of overspending of one of the candidates. SCA said that it was highly unlikely that a candidate or his agent could overspend without the knowledge of the other candidates on the list because they must obtain a written authorization from all the other candidates on that list before they could incur any election expenses; and normally the number of persons who could incur expenses was very small. Principal Government Counsel added that if a candidate had deliberately concealed his overspending from the other candidates on the list, the Corrupt and Illegal Practices Ordinance provided for a defence for these other candidates if they could prove that the excess amount was incurred without negligence on their part or without their authorization. As a safeguard, the Court was empowered to make an order to except an innocent act or omission as an illegal practice if it was satisfied on evidence that such act or omission arose from inadvertence or accidental miscalculation. However, Principal Government Counsel pointed out that if a candidate, after being aware of the overspending, had continued to incur election expenses resulting in a breach of the overall limit would commit an offence.

13.In response to Mr KAN Fook-yee on the position of a successful candidate who claimed innocence of an overspending offence committed by another candidate on the list, SCA said that it would be for the court to decide on the validity of an election result.

14.Mr TSANG Yok-sing said that there were grey areas as to what should be included as election expenses in the past elections. He expressed concern that the List system might aggravate the problem. SCA opined that setting the election expenses at a higher limit of $500,000 per seat would discourage under reporting of election expenses and the thus help address the situation.

15.Mr CHAN Kam-lam asked why it was necessary to stipulate election expenses limit for individual candidates on a list as there would be a limit for the total expenditure for the list. SCA responded that under the statutory framework of the Corrupt and Illegal Practice Ordinance, there must be a limit on election expenses which applied to individual candidates. There were also practical needs for such a limit because candidates on the same list might spend in different ways for their own electioneering activities. SCA added that it was an offence under the Corrupt and Illegal Practice Ordinance for a candidate's agent to incur any election expenses without the written authorization of the candidate or in excess of the amount specified in the authorization. The limit was considered effective in preventing any illegal practices on the part of the candidates or their agents.

16.Mr CHAN said that in view of the changes in the electoral system in 1998, the statutory requirements on election expenses under the Ordinance might no longer be applicable and should therefore be reviewed. SCA said that the provisions of the Ordinance could still apply to the 1998 LegCo election.

Government's assistance to candidates

17.Mr IP Kwok-him asked whether the Government, instead of raising the election expenses limit, would consider providing assistance to candidates in their campaign e.g. radio and television broadcasts for candidates to promote themselves or publication of publicity materials in bulk. He was of the view that this would encourage grassroots people to participate in elections on a more equal footing and enable candidates to carry out a wider variety of electioneering activities.

18.In response, SCA pointed out that the Government would provide assistance to candidates in the following ways -

  1. organizing forums during Government airtime on radio and television for candidates to promote themselves;

  2. free production and distribution of pamphlets on candidates' particulars and election platform; and

  3. two rounds of free mail postage of candidates' publicity leaflets to electors for each list of candidates in GCs and for each candidate in the other constituencies.

19.As a candidate would need a lot of resources to participate in an election, the Chairman asked whether the Administration would consider using public money to subsidize election expenses, in full or in part, incurred by candidates who had secured votes up to a prescribed threshold. SCA responded that time would not allow consideration of such a suggestion for the 1998 LegCo election. However, the suggestion would be considered in a review to be conducted after the election. Adm

Election expenses limits for Functional Constituencies (FCs)

20.SCA explained that the four-tiers of election expenses limits adopted for the 1995 FC elections was proposed for the 1998 FC elections, with some adjustments to take into account the difference in electorate size between the tiers and inflation, and to allow for flexibility in election spending by the candidates. Member in general found the proposed election expenses limits too high.

21.The Chairman and Mr IP Kwok-him queried the justifications for setting the election expenses limit per FC elector at $32, whereas that per geographical elector was only $2.5. SCA responded that the voting systems adopted for and the electioneering activities undertaken in respect of geographical and FC elections were different. In addition, the dollar value of the elections expenses limit per FC elector was also much higher than that for each GC elector in 1995.

22.In response to Mr Bruce LIU's enquiry, SCA informed members that, on average, FC candidates in the 1995 LegCo election had only incurred up to 65% - 70% of the election expenses limits. Mr LIU opined that any proposed increase in election expenses limits for the 1998 FC elections should have reference to inflation rate only, as the adoption of a four-tier system would take into account the differentiation of electorate size.

23.Mr CHAN Kam-lam said that since the electorate for FCs in the 1998 LegCo election was much smaller than that in the 1995 LegCo election, candidates would require less resources to reach out to the electors. He queried whether the proposed election expenses limits should be set at such a high level.

24.The Chairman said that with higher election expenses limits, FC candidates could mount more signboards on the streets than GC candidates. This would cause confusion to the electors. He suggested that the Administration should consider imposing restrictions on mounting of signboards by FC candidates in view of their small electorate size. SCA said that FC candidates were allowed to mount signboards in the past elections and that the electorate size of some FCs was quite large. The arrangement for the 1998 LegCo election was being considered.

25.In response to the Chairman, SCA undertook to consider members' views on the subject.

Election expenses limits for Election Committee (EC) and EC subsectors

26.Mr CHAN Kam-lam remarked that the election expenses limit for the 1998 EC election should not be as high as $160,000 on the ground that the election expenses limit for the 1995 EC election was only $50,000 and that the mode of electioneering activities would be similar. He proposed that $100,000 would be a reasonable limit having regard to the expanded electorate size i.e. 800 electors. SCA agreed to consider Mr CHAN's suggestion. Adm


27.As a concluding remark, the Chairman pointed out that on the basis of the Administration's proposals on election expenses limits, the overall maximum amount of election expenses to be incurred for the 1998 elections (excluding the EC subsector elections) could be as high as $77 million. The Chairman therefore urged the Administration and the Executive Council to reconsider whether it was worthwhile for the community to make such an investment on electioneering activities, particularly as the LegCo Members to be returned by the election would only serve for a term of two years. Adm

1998 Legislative Council election : subscribers and election deposit for nomination
(PLC Paper No. CB(2) 658(02))

28.SCA briefly introduced the preliminary proposals in respect of subscribers and election deposit for nomination for the 1998 LegCo election as set out in the information paper.

Forfeiture of election deposit

29.With reference to the proposed 5% threshold for forfeiture of election deposit for GCs, Mr Bruce LIU asked whether the Administration would consider lowering it to 2.5%, pointing out that it might be very difficult for a candidate to secure 5% of the total votes cast because of the larger size of GCs and the anticipated high voter registration rate. He opined that a 2.5% threshold would be sufficient to deter frivolous candidates.

30.SCA responded that the Administration considered that a 5% threshold appropriate for GC elections. He supplemented that it was not unreasonable to expect a candidate who decided to run as an independent to secure 5% of the votes cast. In this connection, the Chairman advised members that the threshold for forfeiture was once 12.5%.

31.Mr Bruce LIU referred to paragraph 13 of the PLC Brief which stated that a lower threshold of 2.5% was adopted for the 1995 LegCo EC election on the ground that a candidate who obtained roughly 10% of the total votes would be guaranteed a LegCo seat. He pointed out that a GC candidate might also be able to secure a LegCo seat by obtaining about 10% of the total votes cast under the Largest Remainder Formula, and asked the Administration to consider whether the proposed 5% threshold could be lowered. SCA agreed to consider Mr LIU's view. Adm

II.Any other business

32.As the two agenda items originally proposed for the December meeting had been advanced for discussion at the meeting and there was no other agenda item, the Chairman suggested and members agreed that the next regular Panel meeting scheduled for 5 December 1997 would be cancelled.Clerk

33.There being no other business, the meeting ended at 10:30 am.

Provisional Legislative Council Secretariat
6 January 1998