Paper for Provisional Legislative Council
Panel on Housing

Approved Decoration Contractor System

Purpose

This paper informs Members of the Approved Decoration Contractor System adopted by the Housing Department and provides an appraisal of the effectiveness of the System in preventing triad infiltration in the decoration of new public rental housing estates.

Approved Decoration Contractor System

2.The Approved Decoration Contractor (ADC) System (the System) was first introduced in 1982. It serves the following objectives -

  1. to ensure that decoration works would be carried out properly so as not to affect adversely the building structure; and

  2. to reduce as far as possible the disturbance caused to tenants by other decoration personnel.

Main features of the System

3.The System was modified in 1993 and further improved in 1995. Essential features of the present System are as follows -

  1. Approved Decoration Contractors (ADCs)

    The Department keeps a list of ADCs which are practicing decoration companies with proven capability, experience and financial standing. All ADCs and their management staff are checked by the Police to confirm that they have no connection with triad activities. An open ballot will be conducted to list all the ADCs in a priority order according to which they will be arranged to serve new estates at a ratio of 1 ADC to 250 domestic flats.

  2. Issue of licence

    For the control of decoration contractors, licences listing all the essential terms and conditions, in particular on the standard of work required from them and their conduct, are to be signed by the ADCs before they are allowed to carry out decoration works for tenants of new estates. Failure to observe the terms and conditions of the licence may lead to supension or termination of licence.

  3. Price of decoration works

    For those estate tenants who wish to patronize the ADCs, they are free to negotiate the prices for decoration works with any ADC. This gives the consumers a wide choice of decoration services.

  4. Decoration contract

    A decoration contract is signed between the ADC and the tenant to confirm the types and design of decoration work chosen by the tenant.

  5. Setting up of a Special Work Team

    A Special Work Team comprising an Assistant Housing Manager and two Housing Officers is set up in each new estate. They assist tenants to settle in, conduct spot checks to flat decorated by ADCs or by tenants themselves, and deal with any unauthorised decoration works.

  6. Assessment report

    Based on tenants' feedback and a point system on various decoration aspects, the Special Work Team will assess the performance of the ADCs. An assessment report will be compiled at bi-monthly intervals and appropriate punitive actions as mentioned below will be imposed on those ADCs failing to attain an acceptable level of performance -

    1. for one count of failure in any assessment report, a warning letter will be issued to the ADC;

    2. for two counts of failure in any two assessment reports, the ADC will be suspended from operation for six months; and

    3. for any further count of failure in any subsequent assessment report, the ADC's name will be removed from the Approved List.

  7. Relatives or friends of tenants allowed to carry out decoration works under self-decoration scheme

    Tenants may decorate their flats by themselves, relatives, and friends. However, to prevent the intrusion of unauthorised decoration personnel, tenants or members of his family or his friends/relatives must sign an undertaking that they will carry out decoration work in only one domestic tenancy within the same estate.

  8. Liaison with Police and security control

    Blocks in new estates are provided with security gates and security guards on the ground floor to guard against intrusion of unauthorised decorators and / or undesirable persons. Different identification tags for ADCs, tenants and their helpers are provided to facilitiate easy identification by security guards. To maintain good order on the estate during the intake period, management staff will liaise closely with the local Police for their assistance in combating unlawful activities.

4.A flow chart showing the operation procedures of the ADC System and the process of selecting ADCs on new rental estates is at the Annex.

Action taken on defaulting contractors

5.At present there are 163 ADCs on the Housing Department's approved list. They are subject to tight control under the Administrative Rules of the Department and punitive actions will be taken on their poor performance, misconduct, unhealthy financial situation etc. The following actions have been taken on defaulting contractors in the past five years -

Nature of Action TakenNo. of Cases
Warning - verbal/written19
Suspension/revocation of licence17
Removal from ADC List2

Triad Harassment

6.Since the implementation of the modified System, and with the installation of security gates at the entrance of each block, the number of reports on triad harassment has been significantly reduced. According to the Housing Department's record, there was so far no established case of tenants having been harassed by triad members. The Police has confirmed that they do not keep crime statistics relating to decoration work in new public rental estates. Crime statistics are kept according to the type of offence, e.g. assault, theft and criminal damage.

Effectiveness of the System

7.An independent opinion survey on tenants' views on the ADC System carried out in 1995 on some 2,000 households confirmed that the present System was well received by tenants.

8.Full support has been received from the Police in maintaining law and order and combating triad activities. Both the Independent Commission Against Corruption and the Police consider that the System has achieved the objective intended. In particular, the Police considers that the System had provided effective measures in the control of triad involvement in the field of decoration business in new estates.

Conclusion

9.Since the introduction of the System in 1982 and its subsequent improvement, it has proved to be satisfactory to all concerned parties. However, the Housing Department will keep the System under regular review to ensure its effectiveness.


Housing Department
September 1997


Annex
(P.1 of 2)

Flow Chart on Implementation of the
Approved Decoration Contractor (ADC) System
in New Public Rental Estates

(A) Recruitment of ADCs -

Departmental
Committee		A Departmental Committee (DC) is responsible for drawing up the eligibility criteria, the details of which are shown at the Appendix to this Annex.

Advertisement in
newspapers		To invite application from contractors.

ScreeningTo vet the eligibility of the applicants by the DC.

MOC ApprovalTo submit the recruitment report to the Housing Authority's Management and Operations Committee for approval.

Ballot An open ballot for the ADCs will be conducted to determine their priority/work sequence to execute decoration works in new public rental estate.

Allocation to
Estates		ADCs are allocated to new estates at the ratio of 1 ADC to 250 domestic flats.

(B) Tenants' decoration -

Intake briefingAt the time of intake, tenants are briefed on the ADC System by the management staff with the aid of a video featuring the ADC system.

Application
for
decoration


Estate Office Approval

Tenants are required to submit applications and obtain approval from the estate office before their decoration by ADCs/self-decoration are allowed to be carried out.

Arrangement
of
decoration 		Tenants may decorate their flats by one of the ADCs provided for the estate or by themselves with assistance of their friends/relatives (self-decoration). The following control measures are taken during the decoration period -

  1. To facilitate checking of the Police/estate staff, the approval for decoration should be displayed inside their flats; and

  2. ADCs, tenants, and their friends/relatives assisting in the decoration are required to wear the designated types of identification tags for easy identification.

Spot check
by estate
staff		A Special Work Team from the estate office will carry out frequent inspections to flats under decoration to find out whether there are any unauthorised alterations and whether there are any complaints from tenants. Frequent inspections to flats also help to deter the intrusion of unauthorised contractors and check standard of work of the ADCs.

Collection
of Tenants'
Survey Form		Upon completion of decoration undertaken by ADCs, the Special Work Team will collect from the tenants the Survey forms on ADCs' performance. The tenants' feedback together with the estate staff's assessment are the basis for appraisal on the ADCs' performance. Appropriate punitive actions will be taken against ADCs failing to attain an acceptable level of performance.

Appendix to Annex

Criteria for Admission into the List of Approved Decoration Contractors (the List)

Recruitment of contractors for admission into the List is conducted through an advertisement in the local newspapers but only on a need basis as decided by HD. Contractors of the following two sources will be considered for admission into the List subject to the requirement of having been checked by the Police confirming that they have no involvement in triad activities -

  1. Group 1: Those who apply in response to HD's advertisement for recruitment of ADCs are required to satisfy all the following criteria before being considered -

    1. To have an amount of cash at bank and/or usable unutilized balance of bank overdraft facility to a total sum of not less than HK$1,500,000;

    2. To have at least five years' experience in building work or appropriate trade;

    3. The total value of works carried out by the applicant in the past three years should not be less than $2M per year;

    4. To have undertaken at least one contract of value not less than HK$400,000 in the past three years; and (v) To possess a proper workshop/shop/office of reasonable size.

  2. Group 2 : All contractors currently on List I or II of the Approved Contractors for Public Works (Buildings), or on the Housing Authority List of Building Contractors - New Works (NW1 and NW2) or Maintenance Works (M1 and M2) will be enrolled as eligible ADCs provided they apply in response to HD's advertisement for recruitment of ADCs. Those who apply under this Group need not go through the screening process as required for those under Group 1 because of their status having been accepted as contractors capable of executing much larger scale of works.

Annex I

Key Findings of the Survey carried out on the
Modified Approved Decoration Contractor System

(a) tenants' view on the ADC system

SatisfactionAverage/
acceptable		DissatisfactionNo
Comments
50%25%2%23%

(b) tenants' assessment on the ADCs' performance

SatisfactionAverage/
acceptable		DissatisfactionNo
Comments
33%52%12% 3%