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Following is a speech (translated from Chinese) by the Chief Secretary for Administration, Mr Stephen Lam, in response to Report No. 56 of the Public Accounts Committee in the Legislative Council today (October 19):
President,
Laid on the table today is the Government Minute (GM) responding to Report No. 56 of the Public Accounts Committee (PAC).
When presenting Report No. 56 on July 6, the Chairman of PAC set out comments on two chapters in the Director of Audit's Reports, viz. Hong Kong 2009 East Asian Games (EAG) and Hong Kong Housing Authority: Management of commercial properties.
We are grateful for the time and efforts that the PAC has devoted to discussing these topics. We accept various recommendations of the PAC. The Administration's specific responses are set out in the GM. Today, I would like to highlight the key measures that we have taken in the relevant areas.
Hong Kong 2009 East Asian Games
The 2009 East Asian Games (EAG) was the first major international multi-sport event ever held in Hong Kong. In general, the Administration accepts the recommendations made by the Audit Commission and the PAC on the 2009 EAG. The Home Affairs Bureau will compile an overall report on the EAG. It will be submitted to the Sports Commission soon and then to the PAC. In planning and organising major international multi-sport events in future, the Administration will share the experience gained from hosting the EAG with the event organisers. We will also collaborate with the event organisers to plan in advance and conduct post-implementation reviews so as to identify good practices and lessons learned.
It has all along been the Administration's practice that when seeking the Finance Committee (FC)'s acceptance-in-principle and funding approval for implementing a major event, the full financial implications of the proposal will be set out in the FC submission. In seeking FC's funding approval to host major international multi-sport events in future, the Administration will endeavour to provide an estimate that is as comprehensive and accurate as possible at the time of submission. We will also endeavour to include all expenditure that can be foreseen at the time when the budget is prepared, including, for example, expenditure for implementing legacy projects, and present the best possible estimates of the costs of temporary improvement works in the submissions.
In addition, if there are significant changes to the estimates of a major event after FC's funding approval has been obtained, bureaux concerned would inform the Legislative Council (LegCo) of such changes where necessary. In case there are sources of income other than government funding approved by FC (e.g. community/commercial sponsorship), bureaux will dispose of the surplus funding according to the terms of the FC's approval and the sponsorship. Where appropriate, bureaux concerned will consult LegCo and the relevant sponsors regarding the disposal of the surplus. In a circular memorandum issued in September 2011, all bureaux and departments were reminded of the above requirements.
With regard to the liquidation of the EAG Company, after paying profits tax out of the company's liquidation account, the Liquidator refunded the remaining balance of around $10 million to the Government in August 2011.
We believe that hosting the EAG helped raise the community's interest in sport. The Administration will take into account the experience gained from hosting the event when drawing up and implementing further initiatives to promote the development of sport in Hong Kong.
Hong Kong Housing Authority: Management of commercial properties
The Administration fully agrees with the importance of ensuring the effective use and attractiveness of the Hong Kong Housing Authority's (HA) commercial properties. The Housing Department (HD) has implemented new stringent measures to step up actions against improper use and unauthorised alteration of retail premises in consultation with the HA's Commercial Properties Committee (CPC). New regulatory actions by adopting a firm approach against the defaulted commercial tenants have been clearly disseminated for strict compliance by the HD's frontline staff. These actions include strengthened tenancy agreement, the Enhanced Marking Scheme for Commercial Properties, prompt referral of all suspected gambling activities to the Police for law enforcement actions, and debarring ex-commercial tenants who have been convicted of an offence or committed other breaches from leasing any HA's commercial premises within two to five years upon termination of tenancy.
The HD will continue to carry out joint operations with the Police to combat illegal gambling activities in public areas of public housing estates. As an on-going measure, surprise checks on site by the newly formed Headquarters Audit Teams in the HD have been implemented for performance monitoring purpose. The HD is also conducting staffing review on the adequacy of resources deployed in managing commercial properties.
The overall vacancy rate for the HA's commercial premises is maintained at about 5%, in line with the performance target set by the CPC. However, we note the comparatively higher vacancy rates of retail facilities in some unpopular locations and older estates. To tackle this problem, the HD has examined critically their strengths and weaknesses followed by implementing market re-ordering and conversion plans with a view to turning them into other beneficial uses.
The HD will continue with the existing arrangement to publicise vacant premises for re-letting as frequently as practicable through advertisements and the HA/HD website. In line with the Audit Commission's recommendation, the HD has implemented a new strategy to invite potential tenderers to suggest their preferred trades after two rounds of unsuccessful tendering. Moreover, leasing information on the proposed trades as well as invitation to suggest alternative trades have been posted on the shop front of vacant premises and uploaded to the HA/HD website to attract interested bidders.
With regard to the Audit's recommendation pertaining to the 2005 divestment exercise, though the Administration and the HA have no plan to further divest the HA's retail and commercial facilities, the HD is now conducting in conjunction with the Efficiency Unit a post-implementation review for the 2005 divestment exercise in the light of the Audit's recommendation. The HD will report to the PAC the review findings upon the completion of the study.
Finally, I would like to thank PAC once again for its constructive comments and recommendations. The Administration will, as always, respond positively and implement necessary improvements earnestly. Thank you.
Ends/Wednesday, October 19, 2011
Issued at HKT 11:49
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