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LCQ3: Examination fees for Hong Kong Diploma of Secondary Education Examination
     Following is a question by the Hon Lillian Kwok and a reply by the Secretary for Education, Dr Choi Yuk-lin, in the Legislative Council today (July 13):
     The Government has, for five consecutive years since 2019, rolled out a one-off measure to pay examination fees for school candidates sitting the Hong Kong Diploma of Secondary Education Examination (HKDSE). It is learnt that the measure is widely welcomed by school candidates and schools. In this connection, will the Government inform this Council:
(1) given that when attending the meeting of the Finance Committee (FC) of this Council on May 31, 2019, the then Under Secretary for Education indicated that the authorities would consider the suggestion of regularising the payment of examination fees for school candidates sitting the HKDSE in the context of a comprehensive review of the operation mode and financial structure of the Hong Kong Examinations and Assessment Authority, and that the Education Bureau envisaged that the authorities would put forward specific proposals in about two years upon commencement of the review to seek the views of FC members and stakeholders on such proposals, with a target of completing the review within the subsequent two years, of the details of the relevant proposals and the current progress of the relevant work;
(2) whether it will consider according priority to regularising the payment of examination fees for those HKDSE school candidates with financial difficulties (such as the beneficiaries of the School Textbook Assistance Scheme, the Comprehensive Social Security Assistance Scheme and the Community Care Fund Assistance Programmes); if so, of the details; and
(3) in order to finish the "last mile" for free secondary education, whether the Government will regularise the payment of examination fees for HKDSE school candidates (including school candidates who are Hong Kong children studying in the Mainland cities of the Guangdong-Hong Kong-Macao Greater Bay Area); if so, of the details?
     The Hong Kong Examinations and Assessment Authority (HKEAA), which operates on a self-financing basis, is a statutory body established in 1977 under the Hong Kong Examinations and Assessment Authority Ordinance (Cap. 261). Its main statutory responsibility is to conduct the "specified examinations" which currently refer to the Hong Kong Diploma of Secondary Education (HKDSE) Examination. It is, therefore, the HKEAA's primary duty to professionally administer the HKDSE Examination and to provide fair and just assessment for all candidates. 
     In consideration of the economic outlook and the financial position of the Government at the time, the Financial Secretary announced a number of one-off relief measures in the Budgets of 2018/2019 to 2022/2023 which include the proposal to pay the examination fees for school candidates sitting for the 2019 to 2023 HKDSE Examinations. These one-off relief measures were not recurrent subsidy.
     Our reply to the Hon Lillian Kwok's question is as follows:
(1) In an effort to implement the above relief measure in the 2018/19 Budget, the Education Bureau (EDB) sought the approval of the Finance Committee of the Legislative Council (LegCo) in May 2019 for a new commitment amounting to $160 million to pay the examination fees for school candidates sitting for the 2020 HKDSE Examination. At the meeting, members of the Finance Committee suggested the regularisation of HKDSE Fee Waiver. The EDB replied that the suggestion would not only involve a number of important and complex policy issues, but also relate to the mode of operation and financial structure of the HKEAA as an independent statutory body which operated on a self-financing basis under the HKEAA Ordinance. The EDB would consider the suggestion of regularising HKDSE Fee Waiver in the long run while conducting the comprehensive review on the mode of operation and financial structure of the HKEAA. It was envisaged by the EDB that the review would come up with concrete proposals in about two years' time for consultation with members and stakeholders with a view to completing the review in a further two-year period. The comprehensive review on the mode of operation and financial structure of the HKEAA has subsequently been completed. At the meeting of the Panel on Education of the LegCo on February 5, 2021, the EDB presented the discussion paper titled "The Financial Structure of the Hong Kong Examinations and Assessment Authority and Initial Thoughts on its Long-term Funding Options" to members and sought their views on the long-term funding options of the HKEAA.
     The EDB pointed out in the LegCo paper dated February 5, 2021 that the examination fee is in general charged on a "user pays" principle. The HKDSE Examination fees collected for 2019/20 could only cover about 53 per cent of the operating cost. The cost of examination and the average examination fees charged for a typical candidate taking six subjects in that year were amounted to $5,957 and $3,132 respectively while the shortfall was covered by other income. The HKEAA has been very cautious and prudent in handling the adjustment of the HKDSE Examination fees and absorbed substantial costs for the candidates.
     On the other hand, the additional cost arising from the special examination arrangements (SEAs) for candidates with special educational needs (SEN) is also fully borne by the HKEAA. Such SEAs, including the provision of special examination centres, special question papers, ancillary aids and invigilation arrangements, are to provide a more inclusive environment for SEN candidates. It is observed that the number of candidates with SEN has doubled from 2011/12 to 2019/20, resulting in a corresponding increase in expenditure on SEAs. The current examination fee for SEN candidates is set at the same level as other HKDSE candidates. To ensure that candidates with SEN could be equitably assessed under suitable conditions, the LegCo paper stated that the EDB would discuss with the education sector for the best and the most economical ways of subsidising SEN candidates for attending the HKDSE Examination.
     The HKEAA will continue to take into account factors such as the HKEAA's overall financial position, costs and resources required for administering the examinations, inflation rate, the local economic conditions and the affordability of families in general during the annual review of examination fee adjustments. The EDB would also prudently examine the application for examination fees adjustment by the HKEAA.
(2) The Government has different recurrent financial assistance schemes for students ranging from pre-primary to post-secondary education levels to ensure that no local students would be deprived of education due to financial difficulties. The financial assistance schemes include the School Textbook Assistance Scheme, the Student Travel Subsidy Scheme, the Subsidy Scheme for Internet Access Charges and the Examination Fee Remission Scheme (EFRS) with an aim to help students with financial needs cover their learning expenses. Under the EFRS, school candidates with financial needs sitting for the HKDSE Examination may submit application to the HKEAA through their attending schools. The HKEAA will confirm the results of the means test on the family of the student-applicants with the Working Family and Student Financial Assistance Agency, i.e. the WFSFAA. Eligible candidates will be granted full or half fee remission of examination fees according to their family income. In addition, the Social Welfare Department will provide financial assistance for students from families receiving Comprehensive Social Security Assistance to subsidise their public examination fees. The latest payment in the 2017/18 school year of the HKDSE Examination fees paid by the WFSFAA under the EFRS to the HKEAA was about $33 million. The number of student beneficiaries was about 14 600, among which about 8 200 students were granted full fee remission and about 6 400 students were granted half fee remission.
(3) The Government has been upholding the principle of prudent financial management to ensure the proper use of public funds. The EDB is committed to providing 12-year free quality education and has been allocating substantial resources to enhance education quality of schools, provide timely support to families with financial needs, and alleviate the burden of the parents. In addition, the EDB has regularised the provision of student grant starting from the 2020/21 school year. All students studying in secondary day-schools, primary schools and special schools including public sector schools, Direct Subsidy Scheme schools, English Schools Foundation schools and private schools as well as kindergartens are provided with a student grant of $2,500 every school year to alleviate parents' financial burden in defraying education expenses.
     From the perspective of the education system, free education does not mean that the Government shall provide all relevant services complimentary but to deploy the scarce public resources precisely to support students with financial needs. Certain services or items have been charged on a "user pays" principle or have to be paid by parents, for example the purchase of textbooks, school uniforms and lunches, while assistance will be provided by the Government for families with financial needs to obtain such services or items. The EDB is of the view that there are policy justifications for charging examination fees on a "user pays" principle and such policy should not be changed casually. On the contrary, the arrangement of the Government paying the HKDSE Examination fees for school candidates having regard to its financial situation not only upholds the policy intention, but also maintains the flexibility in the provision of subsidy to allow the Government to deploy resources to areas with the most urgent needs. As the proposal of paying the examination fees for school candidates who are Hong Kong children studying in the Mainland cities of the Guangdong-Hong Kong-Macao Greater Bay Area involves more complex policy issues, it would be difficult for the Government to make commitment at the moment.
     Thank you President.
Ends/Wednesday, July 13, 2022
Issued at HKT 15:05
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