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LCQ15: Payment checking safeguards by Department of Health

     Following is a question by the Hon Ng Leung-sing and a written reply by the Secretary for Food and Health, Dr Ko Wing-man, in the Legislative Council today (January 22):


     In February 2008, a staff member of the Department of Health (DH) was convicted of embezzling $13,710,000.  The authorities indicated thereafter that the department had adopted measures to strengthen its internal control of payment and accounting procedures.  According to the General Revenue Account as at March 31, 2013, the authorities are still recovering this sum of money.  In this connection, will the Government inform this Council:

(1)  of the latest progress in recovering this sum of money, and why the sum has not yet been written off; and

(2)  whether it regularly examines if the department concerned has earnestly enforced the aforesaid measures to improve the internal control?



(1)  The Police commenced investigation immediately after the incident was discovered by Department of Health (DH) in 2007.  The officer concerned was subsequently charged with false accounting and sentenced to five years' imprisonment in 2008.  According to the information from the Police, there was no evidence showing that the officer concerned possessed any valuable assets.  In order to recover the sum embezzled, DH took legal actions against the officer concerned and instigated civil proceedings in the High Court through the Department of Justice (DoJ).  A judgment in favour of the Government was obtained in April 2010.  Subsequently, DoJ successfully obtained from the court a bankruptcy order against the officer concerned in February 2011.  The bankruptcy order is valid for four years during which the Official Receiver's Office will recover the arrears from the debtor in accordance with its established recovery procedures.  Upon completion of all recovery procedures within the validity period and after exhaustion of all feasible means to recover the arrears, the Government will proceed to write off the outstanding sum in accordance with existing procedures.

(2)  The DH has reminded all staff of its Finance Office of the need to strictly comply with government regulations and instructions in processing payments.  In particular, all officers involved in payment processing have been reminded to ensure that claims for payments are adequately supported, properly certified and correctly accounted.  To this end, a comprehensive checklist on payment checking has been issued to provide the staff with practical assistance in dealing with matters relating to authorisation of payment vouchers.  Circulars have also been issued to provide a summary of major points to be observed by budget holders and subject officers in arranging payments.  The checklist and the circulars are re-circulated once every six months as a reminder for the staff concerned.

     As a further safeguard, the DH has introduced sample post-payment checking by budget holders on selected payments charged to their votes.  Its Internal Audit Section has also revised its work plan to conduct more regular checks on payment vouchers and procedures to ensure that the checks and balances are functioning as anticipated.

Ends/Wednesday, January 22, 2014
Issued at HKT 15:02


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