FINANCE COMMITTEE

Record of Meeting held on 15 December 1995 at 2:30 p.m.
in the Legislative Council Chamber

Present:

Absent:

In Attendance for specific items:

Mr D W PESCOD	Principal Assistant Secretary for the Civil Service
Mr Robin MCLEISH	Principal Assistant Secretary for Home Affairs
Mr CHEUNG Ka-man	Senior Executive Officer of Home Affairs Branch
Mr Davey CHUNG	Principal Assistant Secretary for Education and Manpower (3)
Mr S M TSUI	Senior Assistant Director of Education
Mr S T KWAN	Assistant Director of Education (Schools)
Mr H A FARUQI	Assistant Director of Education (Finance)
Dr Iris BUDGE-REID	Principal Assistant Secretary for Education and Manpower (1)
Mr Nigel FRENCH, JP	Secretary-General, University Grants Committee

In Attendance:

Mr K C KWONG, JP	Secretary for the Treasury
Mr Alan LAI, JP	Deputy Secretary for the Treasury
Mrs Lilian WONG	Principal Executive Officer (LegCo Unit), Finance Branch
Miss Pauline NG	Clerk to the Finance Committee
Mrs Constance LI	Chief Assistant Secretary (Finance Committee)

Item No. 1 - FCR(95-96)93

RECOMMENDATIONS OF THE ESTABLISHMENT SUBCOMMITTEE

The Committee approved the item.

Item No. 2 - FCR(95-96)94

HEAD 46 - GENERAL EXPENSES OF THE CIVIL SERVICE
Subhead 023 Quartering

2. A Member noted that there were 130 vacant non-departmental quarters (NDQs) and asked why NDQs were not put to better use so as to save the need for the present funding request. In response, the Principal Assistant Secretary for the Civil Service (PAS/CS) advised that notwithstanding the vacant units, supplementary provision was still required to meet the increased expenditure on Private Tenancy Allowance (PTA) as officers who were receiving the PTA might not be eligible for NDQs. The Administration had already taken steps to improve the vacancy situation, including deleasing 689 NDQs and selling off seven sites and 15 flats over the past two years, resulting in a revenue of over $5 billion. Some 98 officers who were eligible for NDQs would be given notice in January 1996 to relinquish the PTA since there were sufficient NDQs to accommodate them. PAS/CS further explained that under normal circumstances, vacant units were occupied within one to two months. He anticipated that more units would become vacant by 1997, but the Administration would make every effort to reduce the number of vacant units. He agreed to provide further information on the utilisation of NDQs.

3. In response to a Members question, PAS/CS explained that officers appointed before October 1990 and remunerated on MPS Point 34 or above were free to join the Home Financing Scheme (HFS) or to remain on PTA. With the expiry of the option deadline in September 1995, the Administration had registered a total of over 7,000 officers of this category who opted for the HFS . Of these, 2,341 officers had relinquished PTA and another 760 returned their NDQs to the Government, resulting in a cost saving of over $15 billion over a 20-year period. He added that this exceeded the original estimated saving of $3 billion.

4. The Committee approved this item.

Item No. 3 - FCR(95-96)95

HEAD 177 - SUBVENTIONS: NON-DEPARTMENTAL PUBLIC BODIES
New Recurrent Account Subhead Privacy Commissioner for Personal Data

5. In response to a Members question on the remuneration package for the staff of the Privacy Commissioners Office (PCO), the Deputy Secretary for the Treasury stressed that the terms and conditions would not be superior to those provided by Government to comparable grades in the civil service. In addition to salary, the PCO staff, to be engaged on a contract basis, would be given a monthly cash allowance in lieu of those fringe benefits available to officers performing comparable jobs in the civil service. The cash allowance would be determined having regard to the actual on-cost rates of comparable ranks of staff in the civil service and would be subject to regular review. Moreover, the amount of the cash allowance would be fixed throughout the contract period and the new rates, having regard to the then prevailing civil service on-cost rates, would apply at the renewal of contracts.

6. On the proposed staffing complement for the handling of complaints and enquiries, the Principal Assistant Secretary for Home Affairs (PAS/HA) advised that the present staffing proposal was drawn up having regard to the initial operation of akin office in the United Kingdom. The number of complaints and enquiries to be handled by the PCO were estimated to be around 900 and 2,700 respectively during the initial phase of its operation. Hence, the present manning level should be sufficient to cope with the workload.

7. As regards the need for hiring consultancy services to inspect the personal data systems of organisations, PAS/HA explained that the service would be required on a long-term basis as one of the main tasks of the PCO was to carry out inspections to ensure compliance with the Personal Data (Privacy) Ordinance. This task involved the examination of complex processes and complex data processing equipment. It was therefore highly technical in nature. The PCO would also look to the consultants for expert advice after inspections of personal data systems in making recommendations for compliance with provisions of the Ordinance.

8. Concerning the qualifications required of the Privacy Commissioner, PAS/HA advised that it would be desirable but not essential for the incumbent to have a legal background. As regards the timing of putting the Ordinance into implementation, PAS/HA confirmed that it would be a few months after the Privacy Commissioner was in post to allow time for the PCO to be set up.

9. To address Members worries about possible confusion resulting from a lack of knowledge of the Ordinance, PAS/HA assured Members that every effort would be made to promote and publicise the provisions of the Ordinance. The Home Affairs Branch had in fact issued 48,000 pamphlets on the subject aiming at data users and was already handling enquiries from both the public and private sectors. The Branch was also conscious of the need to ensure that the general public was aware of its rights as data subjects under the Ordinance.

10. The Committee approved this item.

Item No. 4 - FCR(95-96)96

HEAD 40 - EDUCATION DEPARTMENT
Subhead 300 Code of Aid for primary schools
Subhead 305 Code of Aid for secondary schools

11. In response to Members questions, the Senior Assistant Director of Education gave an account of the items chargeable to the School and Class Grant, and explained the basis of calculation for the provision of 110 additional teachers under the School-based Remedial Support Programme for schools with a high intake of the bottom 10% junior secondary pupils, the total of which were in the region of 8,000.

12. The Committee approved this item.

Item No. 5 - FCR(95-96)97

CAPITAL WORKS RESERVE FUND
HEAD 708 - CAPITAL SUBVENTIONS AND MAJOR SYSTEMS AND EQUIPMENT
Universities
The Hong Kong Polytechnic University
New Subhead Phase VI development - site investigation
The Chinese University of Hong Kong
New Subhead Renovation to University Administration Building, facade and entrance circulation
New Subhead Student hostels - site investigation
New Subhead Extension to Madam S H Ho Hostel at Prince of Wales Hospital - site investigation
The University of Hong Kong
New Subhead Development of Faculty of Medicine at the existing site of Northcote Campus of the Hong Kong Institute of Education - site investigation
New Subhead Additional 300-place hall of residence - site investigation
The City University of Hong Kong
New Subhead Senior staff quarters at Cornwall Street

13. Mr. CHEUNG Bing-leung declared an interest as an employee of the City University of Hong Kong (City U). Mrs. Selina CHOW LIANG Shuk-yee and Mr. James TO Kun-sun declared an interest as Board Members of the University of Hong Kong (HKU).

14. Regarding the possibility of retaining the existing Northcote Campus premises especially the new library block, the Secretary-General, University Grants Committee (SG/UGC) confirmed that following the meeting with the LegCo Panel on Education on 12 December 1995, he had obtained confirmation from HKU that in planning for the project, the University would consider making the best use of existing buildings, especially the new library block. Furthermore he understood that preliminary design studies being undertaken by the University and its consultants had indicated that the existing Northcote Campus Library might be able to be retained within the facilities for the Universitys new Medical Faculty. Some technical problems needed to be resolved, but these were being examined and costed. The Government and the UGC would closely monitor the detailed design of the project.

15. On the building of staff quarters for the senior administrative and academic staff of the City U, Members noted that the number of quarters had been reduced from 120 to 72 following the results of the site investigation and preliminary design. Additional funding had also been provided under delegated authority to allow for the revision of the design because of the height restriction on the proposed building site. Members questioned why the authorities were not aware of the height restriction and why the site was chosen in the first instance. Members also asked if it was cost-effective to build only 72 quarters on the proposed site and whether the reduction in the number of quarters would give rise to the need for further funding to make up the shortfall. SG/UGC undertook to provide further information in writing.

16. In response to Members question on the varying standards of provision of government-funded hostel for the institutions, SG/UGC explained that the standards were set by the Government in the past, based primarily on the location and accessibility of the institutions. Presently, the level of provision as a percentage of their full-time student population for HKU, Chinese University of Hong Kong (CUHK), Hong Kong University of Science & Technology and Lingnan College were 25%, 50%, 30% and 50% respectively. No such provision was currently made for the Hong Kong Baptist University, Hong Kong Polytechnic University and City U. However, the UGC was in the process of reviewing the basis for determining the level of government-funded hostel provision and would shortly be making recommendations to the Government in this regard. In doing so, the UGC would recommend that the intrinsic educational value of hostel life should be taken into account as well as other factors.

17. As regards the shortfall of government-funded hostels in HKU and CUHK, SG/UGC admitted that in the past years, priority in the use of land and financial resources had been given to the building of academic facilities. With the gradual completion of these major projects, the UGC was now in a position to consider other projects such as the provision of hostels. In response to a Members question, SG/UGC advised that there might be difficulties for the institutions in soliciting donations if there was no concrete commitment from the Administration that such hostels were to be built. The Administration would only seek funding from the Finance Committee when it was clear to them that the institutions were capable of meeting 25% of the project costs. So far, the institutions had not experienced any difficulties in securing donations for capital projects.

18. Some Members questioned the rationale for including the inflation allowance in the commitment. The inflation allowance, which was calculated having regard to the high inflation rates in the past few years, would provide an unnecessarily large margin for contractors to provide for inflation in making their bids. With the slowing down of economy, Members asked if it was still appropriate to use the same assumptions in calculating the money-of-the-day (MOD) prices for projects. In reply, the Secretary for the Treasury (S for Tsy) advised that the project estimate given in the paper was for budget purpose. The actual tender price would be subject to competitive bidding. The MOD prices were first used in the Airport Core Programme. There was nothing to suggest that the use of MOD prices had any negative impact on the actual tender prices. On the contrary, experience with the MOD approach in the Airport Core Programme contracts indicated clearly that competition was very intense and the Government had been getting very competitive bids as a result. On a Members request for the submission of periodic reports to the Finance Committee on the outturn tender prices of projects, S for Tsy said that he would consider the request seriously.

19. In reply to a Members query about the lack of information to illustrate the UGCs efforts in scrutinizing the original bids from the tertiary institutions, SG/UGC advised that a separate paper providing background information on the annual planning cycle and procedures for processing capital projects funded through the UGC had been forwarded to the LegCo Panel on Education. He assured Members that the UGC would examine the capital proposals put forward by the tertiary institutions in consultation with the Director of Architectural Services and make appropriate adjustments before putting the proposals to the Finance Committee for consideration. In response to the Members request, SG/UGC agreed to provide further information on the original bids proposed by the tertiary institutions and would make this a standard practice for future submissions.

20. The Committee approved this item.

21. The Committee was adjourned at 3:45 p.m.

Legislative Council Secretariat
29 January 1996

Last Updated on 27 November 1998

FINANCE COMMITTEE

Record of Meeting held on 15 December 1995 at 2:30 p.m. in the Legislative Council Chamber

Record of Meeting held on 15 December 1995 at 2:30 p.m.
in the Legislative Council Chamber