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 2015

AND THE RESULTS OF

VALUE FOR MONEY AUDITS (Report No. 65)



February 2016

P.A.C. Report No. 65





CONTENTS


Paragraph

Page

Part 1Introduction

The Establishment of the Committee

1

1

Membership of the Committee

2

1

Part 2Procedure

The Committee's Procedure

1

2 - 3

Confidentiality undertaking by members of the Committee

2 - 3

3

The Committee's Report

4 - 5

3

The Government's Response

6

4

Part 3Report of the Public Accounts Committee on Report No. 62 of the Director of Audit on the Results of Value for Money Audits
[P.A.C. Report No. 62]

Laying of the Report

1

5

The Government Minute

2 - 7

5 - 7

Part 4Report 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 2014 and the Results of Value for Money Audits (Report No. 63)
[P.A.C. Report No. 63]

Laying of the Report

1

8

The Government Minute

2 - 31

8 - 22

Part 5Supplemental Report of the Public Accounts Committee on Report No. 63 of the Director of Audit on the Results of Value for Money Audits
[P.A.C. Report No. 63A]

Laying of the Report

1

23

The Government Minute

2 - 5

23 - 27

Part 6Committee Proceedings

Consideration of the Director of Audit's Report

1

28

Meetings

2

28

Arrangement of the Report

3 - 4

28

Acknowledgements

5

28

Part 7Observations of the Public Accounts Committee on the Report of the Director of Audit on the Accounts of the Government of the Hong Kong Special Administrative Region for the year ended 31 March 2015

1

29

Part 8Chapter

1.Government's efforts in managing municipal solid waste

A.Introduction

1 - 9

30 - 33

B.Reduction in municipal solid waste

10 - 31

34 - 45

C.Recovery of municipal solid waste

32 - 43

46 - 52

D.Recycling of municipal solid waste

44

52 - 53

E.Treatment and disposal of municipal solid waste

45 - 58

53 - 59

F.Way forward

59 - 61

59 - 62

G.Conclusions and recommendations

62 - 64

62 - 73

2.Reduction and recycling of food waste

A.Introduction

1 - 9

74 - 77

B.Reduction in food waste

10 - 35

77 - 89

C.Recycling of food waste

36 - 75

89 - 105

D.Way forward

76 - 79

106 - 108

E.Conclusions and recommendations

80 - 82

109 - 122

3.Use and disposal of vacant school premises

A.Introduction

1 - 10

123 - 127

B.Identifying vacant school premises

11 - 26

128 - 136

C.Allocating vacant school premises for educational or other use

27 - 48

136 - 148

D.Handling cases of vacant school premises not surrendered

49 - 52

148 - 150

E.Property management of vacant school premises

53 - 57

150 - 152

F.Conclusions and recommendations

58 - 60

152 - 167

4.Operation of the Hongkong Post

A.Introduction

1 - 7

168 - 170

B.Performance of the Hongkong Post as a trading fund

8 - 21

170 - 176

C.Management of mail processing

22 - 40

176 - 189

D.Management of post offices

41 - 48

190 - 193

E.Management of postal vehicles

49 - 54

194 - 196

F.Management of Central Mail Centre and General Post Office Building

55 - 57

196 - 197

G.Conclusions and recommendations

58 - 60

198 - 209

5.Burial and cremation services

1 - 4

210 - 212

6.Efforts of the Narcotics Division and Beat Drugs Fund in combating drug abuse

1 - 7

213 - 214

7.Protection of revenue on dutiable commodities and motor vehicle first registration tax

1 - 5

215 - 216

8.Management of the public lighting system

1 - 5

217 - 218

9.Support for Self-reliance Scheme

1 - 5

219 - 221

10.Shine Skills Centre

1 - 6

222 - 225

SIGNATURES OF THE CHAIRMAN, DEPUTY CHAIRMAN AND MEMBERS OF THE COMMITTEE

 
226

CHAPTERS IN THE DIRECTOR OF AUDIT'S REPORT NO. 65 DEALT WITH IN THE PUBLIC ACCOUNTS COMMITTEE'S REPORT

 
227

Appendix relating to Part 1: "Introduction"

Appendix 1Rules of Procedure of the Legislative Council of the Hong Kong Special Administrative Region

 
228 - 229

Appendix relating to Part 2: "Procedure"

Appendix 2Paper presented to the Provisional Legislative Council by the Chairman of the Public Accounts Committee at the meeting on 11 February 1998 on Scope of Government Audit in the Hong Kong Special Administrative Region - 'Value for Money Audits'

 
230 - 232

Appendices relating to Part 4: "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 2014 and the Results of Value for Money Audits (Report No. 63)
[P.A.C. Report No. 63]"

Appendix 3Location of the five commercial buildings and the five footbridges in the Central District

 
233

Appendix 4Letter dated 1 February 2016 from Director of Environmental Protection

 
234 - 236

Appendix relating to Part 4: "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 2014 and the Results of Value for Money Audits (Report No. 63)
[P.A.C. Report No. 63]"
and Part 5: "Supplemental Report of the Public Accounts Committee on Report No. 63 of the Director of Audit on the Results of Value for Money Audits
[P.A.C. Report No. 63A]"

Appendix 5Letter dated 22 January 2016 from Secretary for Transport and Housing

 
237 - 240

Appendix relating to Part 6: "Committee Proceedings"

Appendix 6Witnesses who appeared before the Committee

 
241 - 243

Appendices relating to Chapter 1 of Part 8: "Government's efforts in managing municipal solid waste"

Appendix 7Opening statement made by Acting Secretary for the Environment at the public hearing on 7 December 2015

 
244 - 249

Appendix 8Reply dated 21 December 2015 from Director of Environmental Protection

 
250 - 293

Appendix 9Reply dated 15 December 2015 from Commissioner for Census and Statistics

 
294

Appendix 10Reply dated 14 December 2015 from Commissioner of Customs and Excise

 
295 - 296

Appendix 11Reply dated 3 December 2015 from Director of Environmental Protection

 
297 - 300

Appendix 12Reply dated 22 December 2015 from Director of Environmental Protection

 
301 - 304

Appendix 13Letter dated 11 January 2016 from Director of Environmental Protection

 
305 - 308

Appendices relating to Chapter 2 of Part 8: "Reduction and recycling of food waste"

Appendix 14Opening statement made by Secretary for the Environment at the public hearing on 12 December 2015

 
309 - 319

Appendix 15Letter dated 13 January 2016 from Director of Environmental Protection

 
320 - 342

Appendix 16Letter dated 23 December 2015 from Director of Environmental Protection

 
343 - 389

Appendix 17Letter dated 22 December 2015 from Commissioner of Correctional Services

 
390 - 396

Appendix 18Letter dated 22 December 2015 from Chief Executive, Hospital Authority

 
397 - 399

Appendix 19Letter dated 24 December 2015 from Director of Food and Environmental Hygiene

 
400 - 405

Appendix 20Letter dated 22 December 2015 from Secretary for Education

 
406 - 409

Appendix 21Letter dated 6 January 2016 from Secretary for Education

 
410 - 412

Appendix 22Letter dated 2 December 2015 from Director of Environmental Protection

 
413 - 416

Appendix 23File minute dated 27 July 2010 from the Environmental Protection Department to Secretary for the Environment

 
417 - 421

Appendix 24Summary of key features/items for inclusion of updated and modified requirements to the tender documents in 2013 for Organic Waste Treatment Facility Phase 1 project as compared to that of the tender exercise in 2011

 
422 - 429

Appendix 25Letter dated 23 December 2015 from Director of Housing

 
430 - 433

Appendices relating to Chapter 3 of Part 8: "Use and disposal of vacant school premises"

Appendix 26Opening statement made by Secretary for Education at the public hearing on 15 December 2015

 
434 - 436

Appendix 27Letter dated 31 December 2015 from Secretary for Education

 
437 - 456

Appendix 28Details on the 14 vacant school premises not on the vacant school premises database maintained by the Education Bureau

 
457 - 458

Appendix 29Letter dated 19 January 2016 from Secretary for Education

 
459 - 470

Appendix 30Letter dated 22 January 2016 from Secretary for Development

 
471 - 473

Appendix 31Details of the eight vacant school premises under the Education Bureau not earmarked for use as at 30 April 2015

 
474 - 475

Appendix 32Mechanism on handling of vacant school premises on government land

 
476

Appendix 33Proposed enhancement on the handling of vacant school premises on private land retained by the Education Bureau for school or other educational uses

 
477

Appendix 34Proposed enhancement on the handling of vacant school premises on private land not required for allocation by the Education Bureau for school or other educational uses

 
478

Appendix 35Letter dated 20 January 2016 from Director of Lands

 
479 - 484

Appendix 36Letter dated 30 December 2015 from Director of Lands

 
485 - 490

Appendix 37Letter dated 31 December 2015 from Director of Housing

 
491 - 496

Appendices relating to Chapter 4 of Part 8: "Operation of the Hongkong Post"

Appendix 38Opening statement made by the Secretary for Commerce and Economic Development at the public hearing on 30 November 2015

 
497 - 500

Appendix 39Submission dated 11 December 2015 from Union of Hong Kong Post Office Employees

 
501 - 503

Appendix 40Submission dated 16 December 2015 from Hong Kong Postal Workers Union

 
504 - 506

Appendix 41Letter dated 17 December 2015 from Secretary for Commerce and Economic Development

 
507 - 508

Appendix 42Note setting out the major differences amongst the different modes of operation of the Hongkong Post

 
509 - 512

Appendix 43Extract of the Annual Business Plan 2014-2015 and the Medium Range Corporate Plan (2014-2015 to 2018-2019) for the Hongkong Post on business environment in the medium term

 
513 - 525

Appendix 44Extract of the Annual Business Plan 2014-2015 and the Medium Range Corporate Plan (2014-2015 to 2018-2019) for the Hongkong Post on measures to secure the longer-term operational sustainability and financial viability of the Hongkong Post

 
526 - 530

Appendix 45Letter dated 17 December 2015 from Postmaster General

 
531 - 537

Appendix 46Letter dated 22 January 2016 from Postmaster General

 
538 - 543

Appendix 47Letter dated 8 January 2016 from Postmaster General

 
544 - 561

Appendix 48Letter dated 9 December 2015 from Postmaster General

 
562 - 567

Appendix 49Hongkong Post's revenue-generation measures and its effort in introducing new services in recent years

 
568 - 572

Appendix 50Breakdown of Post Office Trading Fund's Operating Revenue for the period from 2010-2011 to 2014-2015

 
573

Appendix 51Letter dated 9 December 2015 from Secretary for Financial Services and the Treasury

 
574 - 577

Appendix 52Target rates of return for the Hongkong Post since 1995-1996

 
578

Appendix 53Letter dated 4 January 2016 from Secretary for Financial Services and the Treasury

 
579 - 580

Appendix 54Memo dated 20 December 2011 from Postmaster General to Secretary for Financial Services and the Treasury

 
581 - 585

Appendix 55Email dated 9 July 2010 from the Commerce and Economic Development Bureau to the Financial Services and the Treasury Bureau

 
586 - 601

Appendix 56Letter dated 5 January 2016 from Postmaster General

 
602 - 620

Appendix 57Overtime work in Hongkong Post

 
621 - 624

Appendix 58Guidelines on delivery workload assessment promulgated to supervisors and managers in the Mail Distribution Division

 
625 - 646

Appendix 59Content of the first training course provided by the Hong Kong Polytechnic University to the Hongkong Post staff in 1999

 
647

Appendix 60Number of civil servants, vacancies and the vacancy rates in the Mail Distribution Division and the Air Mail Centre in 2010-2011 to 2015-2016

 
648

Appendix 61Number of non-civil service contract staff, vacancies, the vacancy rates and the wastage rates in the Mail Distribution Division and the Air Mail Centre in 2010-2011 to 2015-2016

 
649

Appendix 62Wastage rates of the Postal Office grade and the Postman grade in 2010-2011 to 2014-2015

 
650

Appendix 63Standards and guidelines for the provision of post office in the Hong Kong Planning Standards and Guidelines

 
651 - 652

Appendix 64Reasons for low utilization rate of 15 vehicles in Hongkong Post in 2014-2015

 
653 - 655

Appendix 65Allocation plan for 46 work stations on the fifth floor of Central Mail Centre

 
656 - 657

Appendix relating to Chapter 5 of Part 8: "Burial and cremation services"

Appendix 66Letter dated 6 January 2016 from Director of Food and Environmental Hygiene

 
658 - 669

Appendices relating to Chapter 6 of Part 8: "Efforts of the Narcotics Division and Beat Drugs Fund in combating drug abuse"

Appendix 67Reply dated 5 January 2016 from Commissioner for Narcotics

 
670 - 675

Appendix 68Reply dated 21 January 2016 from Commissioner for Narcotics

 
676 - 677

Appendices relating to Chapter 7 of Part 8: "Protection of revenue on dutiable commodities and motor vehicle first registration tax"

Appendix 69Reply dated 6 January 2016 from Secretary for Financial Services and the Treasury and Commissioner of Customs and Excise

 
678 - 682

Appendix 70Reply dated 21 January 2016 from Secretary for Financial Services and the Treasury and Commissioner of Customs and Excise

 
683 - 685

Appendices relating to Chapter 8 of Part 8: "Management of the public lighting system"

Appendix 71Reply dated 7 January 2016 from Director of Highways

 
686 - 696

Appendix 72Letter dated 25 January 2016 from Director of Highways

 
697 - 699

Appendix 73Reply dated 5 January 2016 from Director of Electrical and Mechanical Services

 
700 - 701

Appendix 74Letter dated 6 January 2016 from Director of Home Affairs

 
702 - 703

Appendices relating to Chapter 9 of Part 8: "Support for Self-reliance Scheme"

Appendix 75Reply dated 6 January 2016 from Secretary for Labour and Welfare

 
704

Appendix 76Reply dated 6 January 2016 from Director of Social Welfare

 
705 - 730

Appendix 77Letter dated 25 January 2016 from Director of Social Welfare

 
731 - 733

Appendices relating to Chapter 10 of Part 8: "Shine Skills Centre"

Appendix 78Reply dated 8 January 2016 from Secretary for Labour and Welfare

 
734 - 736

Appendix 79Letter dated 7 January 2016 from Executive Director of Vocational Training Council

 
737 - 752

ACRONYMS AND ABBREVIATIONS

 
753 - 757