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LEGISLATIVE COUNCIL ─ 6 February 2013 6441 OFFICIAL RECORD OF PROCEEDINGS Wednesday, 6 February 2013 The Council met at Eleven o'clock MEMBERS PRESENT: THE PRESIDENT THE HONOURABLE JASPER TSANG YOK-SING, G.B.S., J.P. THE HONOURABLE ALBERT HO CHUN-YAN THE HONOURABLE LEE CHEUK-YAN THE HONOURABLE JAMES TO KUN-SUN THE HONOURABLE CHAN KAM-LAM, S.B.S., J.P. THE HONOURABLE LEUNG YIU-CHUNG DR THE HONOURABLE LAU WONG-FAT, G.B.M., G.B.S., J.P. THE HONOURABLE EMILY LAU WAI-HING, J.P. THE HONOURABLE TAM YIU-CHUNG, G.B.S., J.P. THE HONOURABLE ABRAHAM SHEK LAI-HIM, S.B.S., J.P. THE HONOURABLE TOMMY CHEUNG YU-YAN, S.B.S., J.P. THE HONOURABLE FREDERICK FUNG KIN-KEE, S.B.S., J.P. THE HONOURABLE VINCENT FANG KANG, S.B.S., J.P. THE HONOURABLE WONG KWOK-HING, M.H. 6442 LEGISLATIVE COUNCIL ─ 6 February 2013 DR THE HONOURABLE JOSEPH LEE KOK-LONG, S.B.S., J.P. THE HONOURABLE JEFFREY LAM KIN-FUNG, G.B.S., J.P. THE HONOURABLE ANDREW LEUNG KWAN-YUEN, G.B.S., J.P. THE HONOURABLE WONG TING-KWONG, S.B.S., J.P. THE HONOURABLE RONNY TONG KA-WAH, S.C. THE HONOURABLE CYD HO SAU-LAN THE HONOURABLE STARRY LEE WAI-KING, J.P. DR THE HONOURABLE LAM TAI-FAI, S.B.S., J.P. THE HONOURABLE CHAN HAK-KAN, J.P. THE HONOURABLE CHAN KIN-POR, B.B.S., J.P. DR THE HONOURABLE PRISCILLA LEUNG MEI-FUN, J.P. DR THE HONOURABLE LEUNG KA-LAU THE HONOURABLE CHEUNG KWOK-CHE THE HONOURABLE WONG KWOK-KIN, B.B.S. THE HONOURABLE IP KWOK-HIM, G.B.S., J.P. THE HONOURABLE MRS REGINA IP LAU SUK-YEE, G.B.S., J.P. THE HONOURABLE PAUL TSE WAI-CHUN, J.P. THE HONOURABLE ALAN LEONG KAH-KIT, S.C. THE HONOURABLE LEUNG KWOK-HUNG THE HONOURABLE ALBERT CHAN WAI-YIP LEGISLATIVE COUNCIL ─ 6 February 2013 6443 THE HONOURABLE WONG YUK-MAN THE HONOURABLE CLAUDIA MO THE HONOURABLE MICHAEL TIEN PUK-SUN, B.B.S., J.P. THE HONOURABLE JAMES TIEN PEI-CHUN, G.B.S., J.P. THE HONOURABLE NG LEUNG-SING, S.B.S., J.P. THE HONOURABLE STEVEN HO CHUN-YIN THE HONOURABLE FRANKIE YICK CHI-MING THE HONOURABLE WU CHI-WAI, M.H. THE HONOURABLE YIU SI-WING THE HONOURABLE GARY FAN KWOK-WAI THE HONOURABLE MA FUNG-KWOK, S.B.S., J.P. THE HONOURABLE CHARLES PETER MOK THE HONOURABLE CHAN CHI-CHUEN THE HONOURABLE CHAN HAN-PAN DR THE HONOURABLE KENNETH CHAN KA-LOK THE HONOURABLE CHAN YUEN-HAN, S.B.S., J.P. THE HONOURABLE LEUNG CHE-CHEUNG, B.B.S., M.H., J.P. THE HONOURABLE KENNETH LEUNG THE HONOURABLE ALICE MAK MEI-KUEN, J.P. DR THE HONOURABLE KWOK KA-KI 6444 LEGISLATIVE COUNCIL ─ 6 February 2013 THE HONOURABLE KWOK WAI-KEUNG THE HONOURABLE DENNIS KWOK THE HONOURABLE CHRISTOPHER CHEUNG WAH-FUNG, J.P. DR THE HONOURABLE FERNANDO CHEUNG CHIU-HUNG THE HONOURABLE SIN CHUNG-KAI, S.B.S., J.P. DR THE HONOURABLE HELENA WONG PIK-WAN THE HONOURABLE IP KIN-YUEN DR THE HONOURABLE ELIZABETH QUAT, J.P. THE HONOURABLE MARTIN LIAO CHEUNG-KONG, J.P. THE HONOURABLE POON SIU-PING, B.B.S., M.H. THE HONOURABLE TANG KA-PIU DR THE HONOURABLE CHIANG LAI-WAN, J.P. IR DR THE HONOURABLE LO WAI-KWOK, B.B.S., M.H., J.P. THE HONOURABLE CHUNG KWOK-PAN THE HONOURABLE CHRISTOPHER CHUNG SHU-KUN, B.B.S., M.H., J.P. THE HONOURABLE TONY TSE WAI-CHUEN PUBLIC OFFICERS ATTENDING: THE HONOURABLE JOHN TSANG CHUN-WAH, G.B.M., J.P. THE FINANCIAL SECRETARY LEGISLATIVE COUNCIL ─ 6 February 2013 6445 THE HONOURABLE TSANG TAK-SING, G.B.S., J.P. SECRETARY FOR HOME AFFAIRS THE HONOURABLE MATTHEW CHEUNG KIN-CHUNG, G.B.S., J.P. SECRETARY FOR LABOUR AND WELFARE THE HONOURABLE GREGORY SO KAM-LEUNG, G.B.S., J.P. SECRETARY FOR COMMERCE AND ECONOMIC DEVELOPMENT MR JOHN LEE KA-CHIU, P.D.S.M., P.M.S.M., J.P. SECRETARY FOR SECURITY THE HONOURABLE EDDIE NG HAK-KIM, S.B.S., J.P. SECRETARY FOR EDUCATION THE HONOURABLE PAUL TANG KWOK-WAI, J.P. SECRETARY FOR THE CIVIL SERVICE DR THE HONOURABLE KO WING-MAN, B.B.S., J.P. SECRETARY FOR FOOD AND HEALTH THE HONOURABLE PAUL CHAN MO-PO, M.H., J.P. SECRETARY FOR DEVELOPMENT CLERKS IN ATTENDANCE: MR KENNETH CHEN WEI-ON, S.B.S., SECRETARY GENERAL MRS JUSTINA LAM CHENG BO-LING, DEPUTY SECRETARY GENERAL MISS ODELIA LEUNG HING-YEE, ASSISTANT SECRETARY GENERAL MRS PERCY MA, ASSISTANT SECRETARY GENERAL 6446 LEGISLATIVE COUNCIL ─ 6 February 2013 TABLING OF PAPERS The following papers were laid on the table under Rule 21(2) of the Rules of Procedure: Subsidiary Legislation/Instruments L.N. No. Companies (Words and Expressions in Company Names) Order ...................................................................... 7/2013 Companies (Disclosure of Company Name and Liability Status) Regulation .................................................. 8/2013 Companies (Accounting Standards (Prescribed Body)) Regulation .............................................................. 9/2013 Companies (Directors' Report) Regulation ........................ 10/2013 Companies (Summary Financial Reports) Regulation ...... 11/2013 Designation of Libraries (Amendment) (No. 2) Order 2013 ........................................................... 12/2013 Securities and Futures (Contracts Limits and Reportable Positions) (Amendment) Rules 2013 ..................... 13/2013 Residential Properties (First-hand Sales) Ordinance (Commencement) Notice ....................................... 14/2013 Other Papers No. 68 ─ Report of the Public Accounts Committee on the Reports of the Director of Audit on the Accounts of the Government of the Hong Kong Special Administrative Region for the year ended 31 March 2012 and the Results of Value for Money Audits (Report No. 59) (February 2013 ─ P.A.C. Report No. 59) Report No. 10/12-13 of the House Committee on Consideration of Subsidiary Legislation and Other Instruments LEGISLATIVE COUNCIL ─ 6 February 2013 6447 ADDRESSES PRESIDENT (in Cantonese): Addresses. Mr Abraham SHEK will address the Council on the "Public Accounts Committee Report No. 59". Report of the Public Accounts Committee on the Reports of the Director of Audit on the Accounts of the Government of the Hong Kong Special Administrative Region for the year ended 31 March 2012 and the Results of Value for Money Audits (Report No. 59) (February 2013 ─ P.A.C. Report No. 59) MR ABRAHAM SHEK: President, on behalf of the Public Accounts Committee (PAC), I have the honour to table our Report No. 59 today. This report contains three main parts: (a) the PAC's assessment of the actions taken by the Administration in response to our recommendations made in previous PAC Reports Nos. 56 and 57; (b) the observations of the PAC on the Report of the Director of Audit on the Accounts of the Government for the year ended 31 March 2012; and (c) the conclusions reached by the PAC on the Director of Audit's Report No. 59 on the results of value for money audits completed between March and September 2012 and tabled in this Council on 14 November 2012. Pursuant to discussion by the PAC, we decided to study in detail four chapters covered by the Audit Report No. 59 which, in our views, contained more serious allegations of irregularities or shortcomings. Our approach, as always, has been fact-finding and problem-solving rather than simply assigning blame and expressing opinions. I wish to emphasize that the objective of the whole exercise is to maintain and improve the high standards of accounting which the Administration has attained, and to learn from past lessons in order to ensure that public moneys have been spent with due regard to economy, efficiency and effectiveness. In this spirit, I wish to draw the attention of this Council to several subjects and highlight the need for further accountability, transparency and prudence in the management of public resources. President, first, I would like to speak on land grants for private hospitals. The PAC is dismayed that although it has been a public policy that non-profit-making private hospitals would be granted lands at nil or nominal premium in return for their agreement to meet two salient conditions, (i) to 6448 LEGISLATIVE COUNCIL ─ 6 February 2013 provide free or low-charge beds, and (ii) to plough back profits or surplus from any hospital operation to improve and expand their facilities, these two conditions had been omitted from some of the direct land grants made. Given that private hospitals nowadays do make profits, and land in Hong Kong is scarce and very precious, the PAC considers that the Administration needs to ensure that private hospitals have been making proper use of the sites granted to them, including benefiting a wider section of the public. The second subject I will briefly refer to is the land sale for private hospital development. The PAC is again dismayed and finds it inexcusable that there had been an over-provision of land for the development of a private hospital in the New Territories. Such over-provision resulted not only in the surplus land having been left idle for years, but also gave the owner an unfair and unjustified advantage over other developers on rezoning the land for residential development at a premium to be paid. The Administration has assured the PAC that similar incidents should not recur for the following reasons. First, the Administration will be more precise in determining the size of the hospital site and in assessing the demand for service expansion. Second, strict development controls will be stipulated in the land grants of government sites for new private hospitals, such as land use, total gross floor area and maximum site coverage and building height.

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