LCQ7: Expenditures for construction of school premises and student halls
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    Following is a question by the Hon Cheung Man-kwong and a written reply by the Secretary for Education, Mr Michael Suen, in the Legislative Council today (November 21):

Question:

     Regarding the expenditures for the construction of school premises, academic buildings and student halls for local tertiary institutions, secondary and primary schools, will the Government inform this Council:

(a) of the parties responsible for meeting the above expenditures, broken down by the mode of subvention of the schools and level of their curricula, and which of these items involve government loans;

(b) in respect of each item in (a), of the respective total amounts of expenditures, loans granted, interests paid and principals repaid in respect of each school year since 2000; and

(c) of the vetting and approving criteria, terms of repayment and the mechanism for setting interest rates where such expenditures involve government loans?

Reply:

Madam President,

     The Government supports, in various forms, the construction of school premises and student hostels for local primary and secondary schools and tertiary institutions as appropriate. My replies to the above questions in respect of primary and secondary schools and tertiary institutions are set out below.

(a) Forms of assistance: Subvention/Loans

Primary and secondary schools
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     The Government provides capital assistance for the construction of primary and secondary school premises. The School Building Programme of the Education Bureau comprises the following school categories -

(i)   government schools;
(ii)  aided schools;
(iii) Direct Subsidy Scheme (DSS) schools; and
(iv)  private independent schools (PIS).

     For government schools, aided schools, and DSS schools built by the Government, the Government will fund the construction of school premises and provide standard teaching facilities in accordance with approved Schedules of Accommodation. Student boarding facilities are not provided (except for the cases of special schools). If the school sponsoring bodies (SSBs) wish to include non-standard facilities in the school building projects concerned, the costs related to those facilities have to be borne by the SSBs. For individual DSS school projects and all PIS projects delivered by SSBs through their consultants, the Government provides capital assistance to the SSBs at an amount not exceeding the cost for the construction of a standard public sector school accommodating the same number of students.

     Separately, under the existing policy, the English Schools Foundation schools which receive recurrent subvention from Government may apply for a one-off capital assistance in the form of a capital grant, the amount of which should not exceed the cost for building a standard public sector school accommodating the same number of students. Up to 50% of the capital grant may be converted into an interest-free loan, with the size of the loan set at a sum at which the notional compound interest foregone equals to the amount of the capital grant to be converted. Non-profit making international schools may apply for a government loan to build or expand its school premises. Details are outlined in part (c) below.

Self-financing post-secondary institutions
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     The Government set up an interest-free Start-up Loan Scheme with a commitment of $5,000 million in 2001. Self-financing post-secondary institutions (including local universities offering self-financed post-secondary programmes) may apply for interest-free loans under the Scheme to cover relevant expenses for building, purchasing or renting premises.

University Grants Committee-funded institutions and self-financing universities
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     The construction of campuses and teaching buildings of the eight University Grants Committee (UGC)-funded institutions are primarily supported by Government's capital subvention under the annual Capital Works Programme. In addition, some capital works projects are financed by other funding sources secured by the institutions themselves. As regards construction of student hostels, under the existing hostel policy, the Government will finance up to 75% of the construction costs through the Capital Works Programme, with the institutions financing the remaining 25% with their own sources of funding.

     Self-financing universities have to meet the construction costs of their facilities. That said, the Government will consider, upon application, the granting of sites at reduced or nominal premium and the provision of one-off grants to support the long-term development of self-financing, non-profit-making private universities, subject to funding availability and demonstration of genuine needs.

(b) Amounts of subvention/loan

Primary and secondary schools
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     A breakdown of funding approved (in million of dollars) under the School Building Programme by types of schools during the legislative years from 2000/01 to 2006/07 is as follows -

(Please refer to Annex 1)

     As funding was approved by the Finance Committee of the Legislative Council, the above breakdown is based on the legislative year of approval and is not recast into information presented in terms of academic years. During the said period, the Government has not granted any funding or loan to schools operated by the English Schools Foundation or international schools for the construction of school premises.

Self-financing post-secondary institutions
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     The expenditures, loans granted, interest paid and principal repaid (in millions of dollars) in respect of each academic year since 2000 are as follows -

(Please refer to Annex 2)

UGC-funded institutions
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     The amount of public funding approved (in million of dollars) by the Finance Committee of the Legislative Council to support capital works projects of UGC-funded institutions under the Capital Works Programme in respect of each academic year since 2000 is as follows -

(Please refer to Annex 3)

(c) For loans granted by the Government, the vetting and approving criteria, terms of repayment and the interest rates are as follows -

(Please refer to Annex 4)

Ends/Wednesday, November 21, 2007
Issued at HKT 18:13

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