LegCo Paper No. FC 19/96-97
(These minutes have been seen by the administration)
Ref : CB1/F/1/2

Legislative Council Finance Committee

Minutes of the proceedings of the meeting
held on Friday, 25 October 1996
at 2:30 pm in the Legislative Council Chamber

Members present :

    Dr Hon YEUNG Sum (Chairman)
    Hon CHAN Kam-lam (Deputy Chairman)
    Hon Allen LEE, CBE, JP
    Hon Martin LEE, QC, JP
    Hon SZETO Wah
    Hon Ronald ARCULLI, OBE, JP
    Hon Mrs Miriam LAU Kin-yee, OBE, JP
    Dr Hon LEONG Che-hung, OBE, JP
    Hon Albert CHAN Wai-yip
    Hon CHEUNG Man-kwong
    Hon CHIM Pui-chung
    Hon Frederick FUNG Kin-kee
    Hon Michael HO Mun-ka
    Dr Hon HUANG Chen-ya, MBE
    Hon LEE Wing-tat
    Hon Eric LI Ka-cheung, OBE, JP
    Hon Fred LI Wah-ming
    Hon Henry TANG Ying-yen, JP
    Dr Hon Samuel WONG Ping-wai, MBE, FEng, JP
    Hon Howard YOUNG, JP
    Hon Zachary WONG Wai-yin
    Hon James TIEN Pei-chun, OBE, JP
    Hon CHAN Wing-chan
    Hon CHAN Yuen-han
    Hon CHENG Yiu-tong
    Dr Hon Anthony CHEUNG Bing-leung
    Hon CHEUNG Hon-chung
    Hon CHOY Kan-pui, JP
    Hon David CHU Yu-lin
    Hon Albert HO Chun-yan
    Hon IP Kwok-him
    Hon Ambrose LAU Hon-chuen, JP
    Dr Hon LAW Cheung-kwok
    Hon LAW Chi-kwong
    Hon LEE Kai-ming
    Hon LEUNG Yiu-chung
    Hon Bruce LIU Sing-lee
    Hon LO Suk-ching
    Hon MOK Ying-fan
    Hon Margaret NG
    Hon NGAN Kam-chuen
    Hon SIN Chung-kai
    Hon TSANG Kin-shing
    Dr Hon John TSE Wing-ling

Members absent :

    Hon Mrs Selina CHOW, OBE, JP
    Dr Hon David K P LI, OBE, LLD (Cantab), JP
    Hon NGAI Shiu-kit, OBE, JP
    Hon LAU Wong-fat, OBE, JP
    Hon Edward S T HO, OBE, JP
    Hon Emily LAU Wai-hing
    Hon James TO Kun-sun
    Dr Hon Philip WONG Yu-hong
    Hon Christine LOH Kung-wai
    Hon LEE Cheuk-yan
    Hon Andrew CHENG Kar-foo
    Hon Paul CHENG Ming-fun
    Hon LAU Chin-shek
    Hon Mrs Elizabeth WONG, CBE, ISO, JP
    Hon Lawrence YUM Sin-ling

Public officers attending :

Secretary for the Treasury
Mr Kevin HO, JP
Deputy Secretary for the Treasury
Mrs Lilian WONG
Principal Executive Officer (General), Finance Branch
Mr Paul TANG, JP
Deputy Director of Administration
Mr Michael SUEN, CBE, JP
Secretary for Home Affairs
Mrs Irene YAU, ISO, JP
Director of Information Services
Mr Akber KHAN
Deputy Director of Information Services
Mr Stephen LAM, JP
Senior Administrative Assistant to the Chief Secretary
Mr Peter P Y LEUNG, JP
Principal Assistant Secretary for Home Affairs

Clerk in attendance :

Miss Pauline NG
Assistant Secretary General 1

Staff in attendance :

Mr Ricky C C FUNG
Secretary General
Mr LAW Kam-sang
Deputy Secretary General
Mrs Constance LI
Chief Assistant Secretary (Finance Committee)
Mr Andy LAU
Senior Assistant Secretary (Finance Committee)

Item No. 1 - FCR(96-97)63

The Chairman invited members to approve amendments to the delegation of financial powers as set out in the paper.

2. The Committee approved the proposal.

Item No. 2 - FCR(96-97)62

New Recurrent Account Subhead "Legal Aid Services Council"

New Recurrent Account Subhead "Recoverable salaries and allowances (Legal Aid Services Council)"


3. Miss Margaret NG, Chairman of the LegCo Panel on Administration of Justice and Legal Services, remarked that the Panel supported the establishment of a Legal Aid Services Council (LASC). As members of the Panel were concerned about the adequacy of resources which LASC should have to enable it to function effectively, Miss NG asked the Administration to clarify how the funding requirements for LASC given in the proposal were calculated. In response, the Deputy Director of Administration advised that the annual estimates of $4.38 million for LASC were based on the requirements of similar organizations of a non-executive nature, covering general expenses such as office rental, and salaries and allowances for the seven-strong secretariat. In addition, a provision of about $2.56 million would be made to LASC for fitting out office premises and procuring office furniture and equipment, including conference room and simultaneous interpretation facilities for holding meetings in public. As regards the future funding requirements of LASC, these would have to be assessed at a later stage when LASC had started operation for some time and worked out its own procedures, such as the frequency of meetings and work priority. The Chairman advised the Administration to report to the Panel when more details on the operation of LASC were available.

4. The Committee approved the proposal.

Item No. 3 - FCR(96-97)64
Subhead 700 General other non-recurrent
Expenses for the Handover Ceremony and related activities

5. Mr LEE Wing-tat stated that members of the Democratic Party were of the view that the Handover Ceremony was a historic occasion for the British and Chinese governments and Hong Kong, and as such, the British and Chinese governments should also share the costs of the event. As the Agreed Minute of the Sino-British Joint Liaison Group (JLG) on the Handover Ceremony for Hong Kong (Enclosure 1 to FCR(96-97)64) provided that detailed arrangements of the ceremony were to be further discussed and agreed by the JLG, members of the Democratic Party considered that, in the interest of the two governments and the people of Hong Kong, the British and Chinese governments should at least be consulted if they were prepared to share part of the related expenses.

6. In response, the Secretary for Home Affairs (SHA) advised that, as he earlier explained to the LegCo Panel on Home Affairs, the Handover Ceremony would make Hong Kong a centre of international attention. It would be a golden opportunity to promote Hong Kong, making the world see the strengths of this successful city. The Government had considered it appropriate for Hong Kong to shoulder the expenses of the event, as it had been a common practice for the city hosting a major event to be responsible for financing the event, rather than the hosting country. Besides, $233 million, although by no means a small sum, was nonetheless not so huge as to be beyond the capability of Hong Kong, and it was in Hong Kong’s interest to provide the facilities to enable global media coverage and wide community involvement in view of the benefits it would bring to Hong Kong.

Although Hong Kong Government had not asked the British and Chinese governments to share the costs of the ceremony, the JLG Expert Group on Hong Kong’s 1997-98 Budget had been informed, during their recent discussion of Hong Kong’s proposed financial commitments in this respect.

7. Several members expressed the view that they were in support of the holding of a solemn and dignified ceremony, but had reservations on the estimated expenditure for individual items. There was insufficient information on the detailed costings of the various components, such as the Press and Broadcasting Centre (PBC) and other media facilities. Without such information, it was difficult for members to assess whether the proposed expenses were justified and cost-effective. They therefore sought clarification from the Administration in respect of the justification and details of the following proposed expenses :

  1. the expenses of $85 million for the setting up of the PBC;
  2. the $6.5 million estimates for hotel accommodation for overseas delegates;
  3. the $40 million expenses for the cultural, entertainment and community activity programmes; and
  4. the $6.5 million estimates for the pre-ceremony reception and dinner.

8. In response to members’ queries, the Administration provided the following information:

  1. Based on the experience of some major international events such as the Asia Pacific Economic Co-operation meetings, it was estimated that about 6,000 media representatives would wish to cover the events. It was the internationally accepted practice to provide audio-visual transmission facilities for use by the media. The estimated costs of $85 million included venue rental for four weeks, satellite uplinking facilities for four days on a 24-hour basis, and the engagement of contractors to design, construct, equip and manage PBC. To ensure that the PBC facilities would be up to international standard, some special equipment and systems including the Uninterrupted Power Supply system would have to be installed. To economize on expenses, most of these systems would be hired. Compared to the budget of US$20 million for just a TV studio set up for a specific country in the Atlanta Olympics Broadcast Centre, the estimate of $85 million for the whole PBC for the Handover Ceremony was considered reasonable. The Administration considered that the space (9,000 square feet) and facilities of the PBC adequate to cater for the needs of the media.
  2. The Hong Kong Government would provide hotel accommodation for about 100 heads of overseas delegations invited to attend the ceremony. In view of the status of the heads of delegates, deluxe suites would be provided in accordance with international practice, for a duration of about six days. The estimated expenses also included miscellaneous expenses such as laundry and telephone charges. The hotel deposits for other overseas guests would be recoverable although advance payment would have to be made by Hong Kong Government.


  1. On the cultural and community activities to be organized, the initial thinking was to feature Hong Kong’s various achievements through exhibitions, variety shows and other activities. As these programmes were outside the scope of the Agreed Minute, Hong Kong could determine the contents and presentation of such activities. The Administration would not preclude the possibility of holding joint functions with other organizations, and would brief the Home Affairs Panel on detailed arrangements in due course.
  1. The $6.5 million budget for the pre-ceremony reception and dinner included the banquet costs for 4,000 guests attending the ceremony, and expenses for venue decoration and audio-visual equipment. The estimated costs were considered appropriate to the occasion.

9. The Administration clarified that the figures quoted in the paper were only rough estimates for budgeting purposes, and the actual expenses would depend on tendering results and negotiations with the prospective contractors and hotels, etc. SHA assured members he would exercise stringent control over the expenditure and would ensure prudent use of public monies.

10. Mr LIU Sing-lee indicated that members of the Hong Kong Association for Democracy and People’s Livelihood supported the proposal on the understanding that the events would enhance the image of Hong Kong and would bring about economic benefits to the people of Hong Kong. Nevertheless, they queried if more efforts could be made to reduce the expenditure by encouraging sponsorships or other sources of income such as sale of souvenir items.

11. In reply, the Administration advised that only those income directly related to the event could be used to meet the expenses of the Ceremony. While the Administration would examine the possibility of seeking sponsorships, there would be limitations in this respect in view of the nature of the event.

12. On the recoverable charges, the Administration clarified that these would include hotel room deposits paid on behalf of the overseas guests, and hire charges for using special media rooms in the PBC. The Administration would also explore the possibility of making use of any residual value of facilities and equipment acquired.

13. Some members pointed out that the occasion provided an excellent opportunity for prestigious people from over the world to meet in Hong Kong, and Hong Kong would benefit substantially from these exchanges. By making reference to the estimates of the 1997 World Bank/International Monetary Fund Annual Meetings to be held in Hong Kong, members estimated that the Handover Ceremony would also bring about $400-$800 million income to Hong Kong. In view of these benefits, they were prepared to support the proposal. A member remarked that economic benefits aside, the occasion should be used to impress on the world that Hong Kong was capable of running smoothly, and maintaining its integrity and prosperity after 1997.

14. After discussion, several members maintained the view that while they did not disagree with the proposal, they considered it imprudent to take a decision on a financial proposal in the absence of details and cost breakdowns. They therefore urged the Administration to consider withdrawing the proposal, and to provide detailed information to the Committee for deliberation. In response, the Administration advised that due to time constraint, it would be necessary to have the Committee’s early approval of the financial commitment so as to put in hand planning for the various activities. When details of the programmes were available, the Administration would be prepared to brief the relevant Panel separately after this meeting. In view of the Administration’s decision not to withdraw the proposal, the Chairman ordered a break of five minutes to enable members to consider the proposal.


15. On resumption of the meeting at 4:20 p.m., SHA made a brief statement. He clarified that since the Agreed Minute on the Handover Ceremony was only signed on 26 September 1996, the Administration did not have time to work out the detailed estimates of the proposed activities before this meeting. However, he undertook to provide details of the proposed activities to the LegCo Panel on Home Affairs. Mr Lee Wing-tat was of the view that Finance Committee should only be asked to consider a financial proposal with sufficient information. He therefore moved the motion that further proceedings of the Committee be adjourned so that the Administration could make available detailed information to the Committee for consideration at its next meeting. His motion was seconded by Miss CHAN Yuen-han. The Chairman therefore proposed the question on the motion to adjourn : 15 members agreed and 26 against. The motion was negatived and the Committee continued its proceedings.

16. As the proposal had been discussed at length, the Chairman put the Administration’s proposal to vote: 26 members voted for the proposal, 3 against and 10 abstained.

Ayes :

Hon Allen LEE Hon Ronald ARCULLI
Hon Mrs Miriam LAU Kin-yee Dr Hon LEONG Che-hung
Hon CHIM Pui-chung Hon Frederick FUNG Kin-kee
Hon Eric LI Ka-cheung Hon Henry TANG Ying-yen
Dr Hon Samuel WONG Ping-wai Hon Howard YOUNG
Hon James TIEN Pei-chun Hon CHAN Kam-lam
Hon CHAN Wing-chan Hon CHAN Yuen-han
Hon CHENG Yiu-tong Hon CHEUNG Hon-chung
Hon CHOY Kan-pui Hon David CHU Yu-lin
Hon IP Kwok-him Hon Ambrose LAU Hon-chuen
Dr Hon LAW Cheung-kwok Hon LEE Kai-ming
Hon Bruce LIU Sing-lee Hon LO Suk-ching
Hon MOK Ying-fan Hon NGAN Kam-chuen

(26 members)

Nos :

Hon LEUNG Yiu-chung Hon Margaret NG
Hon SIN Chung-kai

(3 members)

Abstentions :

Hon SZETO Wah Hon Albert CHAN Wai-yip
Hon CHEUNG Man-kwong Hon Michael HO Mun-ka
Hon LEE Wing-tat Hon Fred LI Wah-ming
Hon Zachary WONG Wai-yin Dr Hon Anthony CHEUNG Bing-leung
Hon LAW Chi-kwong Hon TSANG Kin-shing

(10 members)

17. The proposal was approved by the Committee.

Other Business

18. On the Chinese terms recently adopted by the Legislative Council for members to indicate their agreement or disagreement with a proposal at sittings, members indicated that they preferred using and rather than and at Finance Committee meetings. The Chairman agreed to relay the views of the Committee to the President of the Legislative Council for consideration.

19. The meeting was adjourned at 4: 35 p.m.

Legislative Council Secretariat
13 November 1996

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