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Following is the speech introducing the Government Minute by the Chief Secretary for Administration, Mr Donald Tsang, in the Legislative Council today (May 16):

Madam President,

Laid on the table today is the Government Minute responding to Report No 35 of the Public Accounts Committee (PAC). The Minute sets out the measures the Government has taken or is taking, on the conclusions and recommendations contained in the Report.

The PAC selected for detailed study seven of the twelve subjects investigated by the Director of Audit in his Value For Money Report No 35. For the other five subjects not selected for detailed study, the relevant bureaux and departments have been following up on the recommendations of the Director of Audit, and will make regular reports on progress made on these recommendations. May I take this opportunity to thank the Director of Audit for the conscientious and professional way he has undertaken these investigations. This has made Hong Kong a more transparent economy and leading to an even more responsible Government.

The Honourable Eric Li, Chairman of the PAC, spoke on February 14 when tabling the PAC's Report. He commented on the six cases on which study has been completed. I would like to take this opportunity to respond to some of his remarks.

The Government's efforts to control flooding in the urban areas

On the matter of controlling flooding in the urban areas, the Administration has committed significant resources to improving the drainage systems in these areas. We are now carrying out a series of drainage improvement works costing about $5 billion in West Kowloon and will make every effort to secure their early completion.

The departments concerned have taken various improvement measures in the management and co-ordination of public works projects including measures for monitoring the performance of consultants mentioned in the Government Minute. We fully agree that in discharging public duties, there is a need for a responsible attitude as well as properly documented procedures. In this regard, I shall make it a personal motto as Chief Secretary for Administration to foster an accountable and responsible culture within the Government which is one of the greatest objectives of the Civil Service Reform.

Government's support and administration of kindergarten education

On Government's support and administration of kindergarten education, we believe that an effective way to monitor the collection of miscellaneous fees by the kindergartens is to increase transparency to enable parents to make informed choices. Kindergarten operators should be accountable to parents for ensuring that profits are reasonable and that parents have been informed of the voluntary nature of the purchase of the services.

The Education Department has issued a refined "List of Components of School Fees for Kindergartens", making it clear that as from the year 2001/02, kindergarten school fees will include fees for such basic activities as birthday parties and graduation ceremony, which form part of the regular learning process. Moreover, the department has issued instructions to make it explicit that the profit limit of 15% is applicable to both the sale of school items and paid services provided by schools to pupils.

The department has also published a set of Kindergarten Profiles which contain, among other things, information on miscellaneous fees charged by individual kindergartens. Some 42 000 copies were printed for distribution to parents. The Profiles are also available from the department's Homepage, public libraries, district offices, family services centres and maternal and child health centres. Seven briefing sessions on the Profiles were organised for 3 000 parents in March 2001.

The Education Department will continue to adopt a proactive approach in monitoring the collection of miscellaneous fees. During school inspections, it will remind kindergarten operators of the profit limit, and will inspect school records to ensure that the kindergarten adheres strictly to the Code of Practice and other guidelines on purchase and acquisition of paid services. The department will also conduct investigations into allegations of non-compliance with the guidelines, and issue warning letters in case of substantiated irregularities.

The use of employers' returns and notifications for assessing and collecting salaries tax

On the use of employers' returns and notifications for assessing and collecting salaries tax, the Inland Revenue Department has taken measures that strike a balance between tightening the system of tax assessment and collection on the one hand, and ensuring cost-effectiveness on the other.

The department has agreed with Immigration Department a new arrangement for the latter to provide current addresses of tax defaulters as reported on their arrival or departure cards.

To ensure tax collection from "high-risk" taxpayers, the Inland Revenue Department has drawn up new procedures to enable early identification of potential cases which may require the application of departure prevention directions. In addition, the department is considering several possible legislative proposals. These proposals include imposing special requirements on employers of taxpayers who stand a higher chance of departing from Hong Kong without clearing their tax liabilities. We are mindful of the need to safeguard human rights which is very important. The department is seeking legal advice on the human rights implications of these proposals.

The Inland Revenue Department will continue to monitor and review the relevant procedures, with a view to preventing tax defaulting and improving the overall efficiency and effectiveness in tax collection, assessment and recovery.

Interdiction of government officers

On interdiction of government officers, the Administration shares the PAC's observations that we should keep the number of interdiction cases as small as what is strictly necessary and the period of interdiction the shortest possible. The Government Minute outlines the measures that we have taken or will be taking to ensure that interdiction cases are subject to vigilant monitoring at both the central and departmental levels.

The experience of the Secretariat on Civil Service Discipline since its inception in April 2000 confirms that having a dedicated pool of officers to handle cases centrally does help shorten the time needed for disciplinary proceedings. The Civil Service Bureau will review the efficacy of the new system later this year to see if the mechanism could be further streamlined while complying with the principles of natural justice.

In addition, the Police Force has agreed to PAC's recommendation to rationalize its practice governing the pay of officers under interdiction, thereby bringing it in line with the rest of the civil service.

Employees Retraining Scheme

The Employee Retraining Board has examined how best to improve objectivity and accuracy when it reports job placement rates under the Employees Retraining Scheme. The Board will conduct retention surveys on a regular basis to serve as a further indicator of successful job placement. To address the PAC's concern over the effectiveness of the retraining programmes, the Board has standardised most of its courses and will complete the exercise by the middle of this year. The Board will pilot skills assessment test and proceed to develop a common assessment and competency certification of the courses in the long run. User feedback will be part of the assessment process. Also, the Board will recruit additional staff to step up management audits on the training bodies.

The Education and Manpower Bureau is commissioning a consultancy study to review the organisational set-up for vocational training and retraining. As part of that review which is very important, we shall examine the criteria for admission to the Board's programmes.

Comprehensive Redevelopment Programme of the Housing Authority

The Housing Department will ensure that the Comprehensive Redevelopment Programme is carried out in an efficient and effective manner. It has set performance standards on rehousing operations and the letting of public rental flats, and will monitor the situation closely and report to the Housing Authority regularly.

To facilitate rehousing operations and improve the living conditions of tenants, the Housing Department encourages tenants affected by Comprehensive Redevelopment Programme to move to other estates at an early stage before redevelopment. The department will then freeze the flats vacated from re-letting. The Housing Authority has reviewed this arrangement, taking into account the two suggestions of the PAC of letting these vacant flats to families on the Waiting List on a short-term basis and shortening the existing frozen period of three years. The Authority concluded that the scope for reducing the frozen period is limited, and that vacant flats should continue to be frozen from re-letting to avoid "double moves" within a short period. To make better use of resources, these vacant flats will continue to be let to overcrowded families in the same redevelopment phase. The Housing Authority will regularly review this arrangement.

Madam President, I wish to take this opportunity to thank Mr Li and Members of the PAC for their contribution to our common goal of achieving value for money in the delivery of public service. The Administration attaches great importance to forging a constructive partnership with the legislature. Our response to the PAC report as reflected in the Government Minute is one of the examples of how we treasure your constructive comments and sound advice. We look forward to continuing with such constructive partnership to serve the community.

End/Wednesday, May 16, 2001

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