HONG KONG LEGISLATIVE COUNCIL — 13 January 1993 1525 OFFICIAL RECORD OF PROCEEDINGS Wednesday, 13 January 1993 The Council met at half-past Two o'clock PRESENT THE DEPUTY PRESIDENT THE HONOURABLE JOHN JOSEPH SWAINE, C.B.E., Q.C., J.P. THE CHIEF SECRETARY THE HONOURABLE SIR DAVID ROBERT FORD, K.B.E., L.V.O., J.P. THE FINANCIAL SECRETARY THE HONOURABLE NATHANIEL WILLIAM HAMISH MACLEOD, C.B.E., J.P. THE ATTORNEY GENERAL THE HONOURABLE JEREMY FELL MATHEWS, C.M.G., J.P. THE HONOURABLE ALLEN LEE PENG-FEI, C.B.E., J.P. THE HONOURABLE MRS SELINA CHOW LIANG SHUK-YEE, O.B.E., J.P. THE HONOURABLE HUI YIN-FAT, O.B.E., J.P. THE HONOURABLE MARTIN LEE CHU-MING, Q.C., J.P. THE HONOURABLE DAVID LI KWOK-PO, O.B.E., J.P. THE HONOURABLE NGAI SHIU-KIT, O.B.E., J.P. THE HONOURABLE PANG CHUN-HOI, M.B.E. THE HONOURABLE SZETO WAH THE HONOURABLE TAM YIU-CHUNG THE HONOURABLE ANDREW WONG WANG-FAT, O.B.E., J.P. THE HONOURABLE LAU WONG-FAT, O.B.E., J.P. THE HONOURABLE EDWARD HO SING-TIN, O.B.E., J.P. THE HONOURABLE RONALD JOSEPH ARCULLI, J.P. THE HONOURABLE MARTIN GILBERT BARROW, O.B.E., J.P. 1526 HONG KONG LEGISLATIVE COUNCIL — 13 January 1993 THE HONOURABLE MRS MIRIAM LAU KIN-YEE, O.B.E., J.P. THE HONOURABLE LAU WAH-SUM, O.B.E., J.P. DR THE HONOURABLE LEONG CHE-HUNG, O.B.E. THE HONOURABLE JAMES DAVID McGREGOR, O.B.E., I.S.O., J.P. THE HONOURABLE MRS ELSIE TU, C.B.E. THE HONOURABLE PETER WONG HONG-YUEN, O.B.E., J.P. THE HONOURABLE ALBERT CHAN WAI-YIP THE HONOURABLE VINCENT CHENG HOI-CHUEN THE HONOURABLE MOSES CHENG MO-CHI THE HONOURABLE MARVIN CHEUNG KIN-TUNG, J.P. THE HONOURABLE CHEUNG MAN-KWONG THE HONOURABLE CHIM PUI-CHUNG REV THE HONOURABLE FUNG CHI-WOOD THE HONOURABLE FREDERICK FUNG KIN-KEE THE HONOURABLE TIMOTHY HA WING-HO, M.B.E., J.P. THE HONOURABLE MICHAEL HO MUN-KA DR THE HONOURABLE HUANG CHEN-YA THE HONOURABLE SIMON IP SIK-ON, J.P. DR THE HONOURABLE LAM KUI-CHUN DR THE HONOURABLE CONRAD LAM KUI-SHING THE HONOURABLE LAU CHIN-SHEK THE HONOURABLE EMILY LAU WAI-HING THE HONOURABLE LEE WING-TAT THE HONOURABLE GILBERT LEUNG KAM-HO THE HONOURABLE ERIC LI KA-CHEUNG, J.P. THE HONOURABLE FRED LI WAH-MING HONG KONG LEGISLATIVE COUNCIL — 13 January 1993 1527 THE HONOURABLE MAN SAI-CHEONG THE HONOURABLE HENRY TANG YING-YEN, J.P. THE HONOURABLE TIK CHI-YUEN THE HONOURABLE JAMES TO KUN-SUN DR THE HONOURABLE SAMUEL WONG PING-WAI, M.B.E., J.P. DR THE HONOURABLE PHILIP WONG YU-HONG DR THE HONOURABLE YEUNG SUM THE HONOURABLE HOWARD YOUNG, J.P. THE HONOURABLE ZACHARY WONG WAI-YIN DR THE HONOURABLE TANG SIU-TONG, J.P. THE HONOURABLE CHRISTINE LOH KUNG-WAI THE HONOURABLE ROGER LUK KOON-HOO THE HONOURABLE ANNA WU HUNG-YUK ABSENT THE HONOURABLE STEPHEN CHEONG KAM-CHUEN, C.B.E., J.P. THE HONOURABLE MRS PEGGY LAM, O.B.E., J.P. THE HONOURABLE STEVEN POON KWOK-LIM IN ATTENDANCE MR DAVID ALAN CHALLONER NENDICK, C.B.E., J.P. SECRETARY FOR MONETARY AFFAIRS MR EDWARD BARRIE WIGGHAM, C.B.E., J.P. SECRETARY FOR THE CIVIL SERVICE THE HONOURABLE MRS ANSON CHAN, C.B.E., J.P. SECRETARY FOR ECONOMIC SERVICES MR MICHAEL LEUNG MAN-KIN, C.B.E., J.P. SECRETARY FOR TRANSPORT 1528 HONG KONG LEGISLATIVE COUNCIL — 13 January 1993 MR YEUNG KAI-YIN, C.B.E., J.P. SECRETARY FOR THE TREASURY THE HONOURABLE JOHN CHAN CHO-CHAK, L.V.O., O.B.E., J.P. SECRETARY FOR EDUCATION AND MANPOWER MR ALISTAIR PETER ASPREY, O.B.E., A.E., J.P. SECRETARY FOR SECURITY MRS ELIZABETH WONG CHIEN CHI-LIEN, I.S.O., J.P. SECRETARY FOR HEALTH AND WELFARE MR CHAU TAK-HAY, J.P. SECRETARY FOR TRADE AND INDUSTRY MR JAMES SO YIU-CHO, O.B.E., J.P. SECRETARY FOR RECREATION AND CULTURE THE HONOURABLE MICHAEL SZE CHO-CHEUNG, I.S.O., J.P. SECRETARY FOR CONSTITUTIONAL AFFAIRS MR ANTHONY GORDON EASON, J.P. SECRETARY FOR PLANNING, ENVIRONMENT AND LANDS THE CLERK TO THE LEGISLATIVE COUNCIL MR CLETUS LAU KWOK-HONG HONG KONG LEGISLATIVE COUNCIL — 13 January 1993 1529 Sessional Papers 1992-93 No.47 — Report of changes to the approved Estimates of Expenditure approved during the second quarter of 1992-93 Public Finance Ordinance : Section 8 No.48 — Hong Kong Productivity Council Annual Report 1991-92 Address Report of changes to the approved Estimates of Expenditure approved during the second quarter of 1992-93 Public Finance Ordinance : Section 8 SECRETARY FOR THE TREASURY: Mr Deputy President, in accordance with section 8(8)(b) of the Public Finance Ordinance, I now table for Members' information a summary of all changes made to the approved Estimates of Expenditure for the second quarter of the financial year 1992-93. Supplementary provision of $181.9 million was approved. It was fully offset, either by savings under the same or other Heads of Expenditure, or by the deletion of funds under the Additional Commitments subheads. During the period, non-recurrent commitments were increased by $4.8 million, new non-recurrent commitments of $69.1 million were approved, and approved non-recurrent commitments of $67.6 million were revoted. In the same period, a net decrease of 1 574 posts was approved. This was mainly attributable to the deletion of posts as a result of civil servants having opted for service with the Hospital Authority. Items in the summary have been approved either by Finance Committee or under delegated authority. The latter have been reported to the Finance Committee in accordance with section 8(8)(a) of the Public Finance Ordinance. Oral answers to questions Monitoring of the Legal Department 1. MR MARVIN CHEUNG asked: Will the Administration advise this Council whether the work of the Director of Audit includes reviewing the circumstances of cases handled by the Legal Department where substantial costs have been awarded against the Government so as to determine what were the principal reasons for the Government losing the case, whether such losses were 1530 HONG KONG LEGISLATIVE COUNCIL — 13 January 1993 due to human error in the Department and whether any appropriate action has been taken? If such reviews are undertaken, what legal expertise does the Director of Audit or his staff possess to enable their work to be carried out properly? If not, how is the work of the Legal Department being monitored to ensure that massive losses are not incurred by the Government at the expense of taxpayers due to human error in the Legal Department? FINANCIAL SECRETARY: Mr Deputy President, I should like to begin my answer with some general remarks on the award of costs in legal cases, before turning to the specific issue of monitoring. It is in the nature of an adversarial legal system such as ours that there will be winners and losers. Costs may be borne wholly by one party, or the other, or partly borne by both. The fact that costs have been awarded against the Government in a particular case does not necessarily imply error or negligence on anyone's part. It is simply a result of the Government having lost a contested case. We also win many cases, and get awards of costs in our favour. It would be absurd to aim to win every case, and to regard every loss as a form of failure. For the Executive to do so would imply either an unhealthy relationship with the Judiciary, or an overly cautious approach in bringing prosecutions that could only result in large numbers of criminals never being brought before the court. Acquittal of the innocent is just as important a part of justice as conviction of the guilty. In relation to civil cases, it would lead to the Government conceding claims for millions of dollars, simply because it was not certain that the claims would fail. The fact that costs might be substantial in a particular case is simply a reflection of its length and complexity, not a guide as to whether it was worth contesting. Turning now to the question of monitoring, the Director of Audit conducts two kinds of government audit — regularity audit and value for money audit. Regularity audit is carried out under the Audit Ordinance and is concerned with providing this Council with an overall assurance that the Government's financial and accounting transactions are proper, and that they conform with accepted accounting standards. Value for money audit is an examination into the economy, efficiency and effectiveness with which a department has discharged its functions. As the audit field, which encompasses all public expenditure, is large and complex, value for money audit is currently still at the development stage. HONG KONG LEGISLATIVE COUNCIL — 13 January 1993 1531 To date, the audit of legal costs has been confined to regularity audit to see that payments were in order and properly authorized. No value for money audit has been conducted of such payments. If a value for money audit on legal costs were to be conducted by the Director of Audit, he would examine the procedures taken by the Legal Department to see whether they are adequate and whether there was any failure to comply with them. The Audit Department does not have the expertise to establish whether losses of court cases resulted from errors or failures of a legal nature.