Implementation of Complementary Proposals on Professional Development (Oral Question) ( 23 June 2004 )

Dr Raymond HO (in Cantonese): Madam President, regarding the implementation of complementary proposals on professional development, put forward by the Chief Executive in paragraph 38 of this year's policy address, will the Government inform this Council:

(a)   whether a work schedule has been worked out for various professional services to establish business platforms in the Mainland; if so, of the details, including the priority of engineers among the many professions;

(b)   of the measures in place to ensure that the Government will inject an average of about $29 billion per year for capital works projects for the next five years; and

(c)   of the specific measures in place to minimize obstacles for local small and medium-sized professional organizations to participate in various tenders and consultancy contracts for government works?

Secretary for the Environment, Transport and Works (in Cantonese): Madam President,

(a)   To promote the joint economic prosperity and development of the Mainland and the Hong Kong Special Administrative Region (SAR), the Central Government and the SAR Government signed the Mainland/Hong Kong Closer Economic Partnership Arrangement (CEPA) on 29 June 2003 . The major commitments under CEPA have been implemented since 1 January 2004 . Regarding trade in services, the Mainland will liberalize market access for 18 sectors, including construction and related engineering, real estate, accounting, insurance, legal, medical and dental, securities and other professional services. In addition, the two places have also agreed to encourage mutual recognition of professional qualifications under CEPA. In general, the measures in CEPA allow local service providers to provide professional services on the Mainland through reciprocal recognition or the establishment of enterprises.

CEPA adopts a building-block approach, allowing Hong Kong and the Mainland to pursue consultation on the fostering of trade liberalization in respect of professional services and incorporate the agreed liberalization measures into CEPA. The SAR Government is holding consultations with the mainland authorities with a view to making progress in different areas as soon as possible. At this stage, the Central Government and the SAR Government have not laid down any timetable or prioritized various professions for consultation with the Mainland.

As far as the construction industry is concerned, Hong Kong contractors and consultancy firms have already been permitted to set up wholly-owned operations on the Mainland according to their own timetable since CEPA came into effect. Nevertheless, the SAR Government is making great effort in co-ordinating the implementation of CEPA. We have been maintaining close contact with the stakeholders of the construction industry and seeking their views on the implementation of CEPA and the problems they have encountered. We have held several meetings with the Ministry of Construction, that is, the Ministry of Construction of the Central Government, to discuss the concerns of the industry in depth. We understand that it is the hope of the industry that the threshold for entering the mainland market can be lowered for Hong Kong companies. The SAR Government will continue to discuss with the Ministry of Construction matters including lowering the entry requirements for contractors and consultants, simplifying the procedure for applying qualification certificate and permit to commence work, the residence requirements on Hong Kong professional and managerial staff and the timing for injection of capital.

On the mutual recognition of professional qualifications in the construction-related sector, the SAR Government has been maintaining close contact with the professional bodies in Hong Kong , the Ministry of Construction and related mainland professional bodies. We have been actively promoting and co-ordinating the discussions on mutual recognition. To advance the discussions, we have led several times representatives from the relevant professional bodies in Hong Kong to meet officials from the Ministry of Construction and related mainland professional bodies in Beijing at joint working conferences. Thanks to the efforts of all parties concerned, concrete progress in the mutual recognition of professional qualifications in the construction-related sector has been achieved. For example, the professional bodies of estate surveyors and architects of the two places have signed reciprocal recognition agreements in November 2003 and February 2004 respectively. The first round of training and tests were held in March and May 2004 respectively under the agreements.

We have also made good progress in the mutual recognition of qualifications of engineers. The relevant professional bodies of the two places signed a draft reciprocal recognition agreement for structural engineers in February 2004.

As arranged by us, the Hong Kong Institution of Engineers and the China Association of Engineering Consultants are discussing the qualification requirements of the mainland construction supervising engineers. In addition, we have also arranged for the preliminary exploration of the mutual recognition of electrical and geotechnical engineers by the two places.

In order to promote and hasten the mutual recognition of qualifications of the construction-related professions, we, together with the representatives from the relevant professional bodies in Hong Kong, plan to hold another working conference with officials from the Ministry of Construction and related mainland professional bodies in Beijing late this month. We hope that a formal reciprocal recognition agreement for structural engineers can be reached and signed at an early date and consultations on other professional qualifications can continue.

(b)   Regarding capital works projects, the Government will take into account its policy objectives, the established procedures, the development needs and the aspirations of the public in preparing a priority list of essential infrastructure projects. Proposals submitted by different departments are considered at the annual high-level resource allocation meetings in the light of available resources. New projects that need to be undertaken and should commence within five years will be included in the Capital Works Programme.

According to the 2004-05 Estimates, there was an outstanding commitment of about $115.8 billion in respect of Category A projects as at 31 March 2004 . During the 2004-05 financial year, works will start on new projects currently in Category B in the Public Works Programme with an estimated total value of about $24.3 billion. The total value of these projects amounts to $140.1 billion, most of which will be paid within five years. Including the estimated expenditure of the minor works and other items under planning and design which will commence within five years, the Government will reserve about $29 billion per year for capital works projects for the next five years.

(c)   Under the List of Approved Contractors for Public Works, contractors are divided into three groups according to their financial and technical capabilities. Contractors in each group (that is, Group A, B or C) may tender for works contracts of different value. Group A contractors may bid for contracts up to $20 million; Group B contractors may bid for contracts up to $50 million; and Group C contractors may bid for contracts of any value exceeding $50 million. This system can ensure that small and medium-sized companies have the opportunity to tender for contracts in keeping with their capability.

To further encourage small and medium-sized contractors to bid for large projects, the Government allows them to form a joint venture company and submit a single tender on condition that the contractors can jointly satisfy the requirements listed on the tender documents and each of the contractors has the technical knowhow to carry out the part of the works for which it is responsible.

The Government may also split a single contract into smaller ones as far as possible so as to encourage the participation of small and medium-sized contractors. In determining whether a contract should be split into smaller ones, various factors are considered, including feasibility, interface problems, access problems, land availability, various impacts (environmental, drainage and so on), availability of works areas, quality of works and economic benefits.

Regarding consultancy services, our procurement guidelines specify that only small consultancy firms with up to 10 professional staff are allowed to bid for small and simple consultancies with estimated consultancy fees not exceeding $4 million, except for specialized projects. Architectural consultants are also divided into two groups according to their experience and staff size. Companies in each group may only bid for certain contracts. These measures can ensure as far as possible an even distribution of work among consultancy firms of different scale.

DR RAYMOND HO (in Cantonese): Madam President, I thank the Secretary for spending more than 10 minutes reading out the detailed main reply. I also understand that the Government has made a lot of efforts and done a lot of work in mutual recognition of qualifications. However, although now that the professional bodies of architects and estate surveyors have already signed the final agreements on mutual recognition of qualifications, in the engineering sector where there are 16 disciplines and structural engineers are in the first place, even in the mutual recognition of qualifications of structural engineers, only a draft agreement has been initialled and the final agreement has yet to be reached. Can the Secretary tell us when final agreements can be reached for all the 16 engineering disciplines? It is because the WTO-related arrangements will be formally implemented very soon. In regard to the timetable concerned, will there be clearer directions for us to follow?

SECRETARY FOR THE ENVIRONMENT, TRANSPORT AND WORKS (in Cantonese): Madam President, insofar as the mutual recognition of qualifications of the professionals is concerned, I believe, the progress will be different for different trades and sectors. At present, agreements have been signed for two professions, that is, architects and estate surveyors. However, the Government has not accorded any priority to any profession or favoured any profession in particular. We only provide the opportunities and framework to facilitate professionals of various sectors to undertake discussions within this framework. It is because each profession, for example, electrical engineers and geotechnical engineers in the engineering sector, may have different concerns. For their area of interest, that is, the qualifications, their concerns may be different. There are questions such as the qualifications of which place are recognized to be higher or lower, and whether the one with the higher recognition should accommodate the one with lower recognition, or vice versa . Or in terms of the number of people and employment opportunities, how mutual recognition will be affected in future? Estate surveyors and architects have very different views even in this aspect. These cannot be led by the Government but have to be discussed by the professions concerned in the light of conditions reckoned to serve their respective situations well while maintaining the professionalism and trade standards. Therefore, I am unable to answer Dr Raymond HO's supplementary, that is, how we can map out a plan on when a consensus can be reached for the 16 disciplines. When both sides find the conditions appropriate, a consensus can certainly be reached. We only provide the opportunities and framework to facilitate their discussion.

Electronic Waste (Supplementary Question) ( 23 June 2004 )

DR RAYMOND HO (in Cantonese): Madam President, 1.5 million pieces of discarded computers and electrical appliances per year are actually quite a large quantity. The Secretary mentioned in part (b) of the main reply that around 70% of them would be reused or collected by recyclers for second-hand trades. Only 30%, a small portion, would be discarded. May I ask the Secretary of the method adopted to ensure the reliability of the percentage? Could it be possible that over 70% of the used computers and electrical appliances are dumped at the landfills instead of just 30%? Is our recovery rate lower than those in developed countries overseas?

SECRETARY FOR THE ENVIRONMENT, TRANSPORT AND WORKS (in Cantonese): Madam President, this is the result of a detailed survey conducted by the EPD in 2002 on the production and disposal of electronic waste. The purpose of the survey was to assess the quantities and disposal methods of the electronic waste produced by households and the business sector. After interviewing 2 000 households and 300-odd companies, the findings of the survey showed that 1.31 million pieces of used electrical appliances and computers were produced annually by households and 230 000 pieces of used computers were produced annually as a result of industrial and commercial activities. In other words, a total of 1.54 million pieces of used electrical appliances and computers are produced every year. 30% of the interviewees said that the articles would be given away and reused by someone else. 40% of the interviewees indicated that the articles would be sold to recyclers as second-hand goods. Only 30% of the interviewees would throw them away as garbage. As to whether the figures are high or low compared with those in foreign countries, the recovery rate in Japan , for example, is very high because commercial operations are governed by legislation which makes it mandatory to recover electrical appliances. In accordance with the legislation in Japan , manufacturers of electrical appliances are also obliged to recover 85% of the appliances they produced in terms of weight. Apart from recovery exercises, r ecovery parks and a whole set of recovery mechanism have also been put in place in Japan . Therefore, the recovery rate in Japan is much higher than ours.

Buildings (Amendment) Bill 2003 ( 23 June 2004 )

Dr Raymond Ho : The Buildings Ordinance (Cap. 123) was introduced and enacted in 1955. Although amendments had been made in the past, they were however more or less, or in most cases, made in a piecemeal manner. I would agree that the Ordinance has failed to meet the present day needs of Hong Kong , particularly in view of the very rapid economic development and social changes.

In January 2000, I put forward a motion asking the Administration to carry out a comprehensive review of the Buildings Ordinance. We are happy about and welcome the introduction of this Buildings (Amendment) Bill 2003. It is a complex Bill and I would like to take this opportunity to commend the government team's attitude in taking this Bill through, particularly when Ms Olivia Nip started to lead the team. I would also like to show my appreciation of the Chairman of the Bills Committee, the Honourable Cyd Ho . She actually has done a marvellous job, although in the end, we had to agree that this very major part of the proposed Bill in respect of minor works and registration of minor works contractors had to be removed from the Bill this time. It is such an important part of the Bill. However, it affects many walks of life, and we will have a lot of repercussions and implications in the end if it is actually introduced. So, I hope the Government would bring it back to the Legislative Council as soon as possible. Of course, that decision was also made to ensure that this proposed Bill is able to come back to the Council before the end of this term.

I would just like to make a few comments on a few parts of the proposed Bill. First of all, I would like to talk about Registered Geotechnical Engineers. In the submission of building plans for the implementation of a building project, there are several areas which are considered to be the major parts of the whole project. The Authorized Person (AP), of course, looks after the administration and the control of the submission of the whole project, particularly the general building plans. There are three areas which require specific technical expertise, they are structural engineering, geotechnical engineering and building services engineering. Up to now, we have only had one category for Registered Structural Engineers (RSE) who are looking after the first area. However, there is no provision at all for the other two categories, after I would say 11 or 12 years' discussion on this registration of Geotechnical Engineers, including six to seven years' internal discussions within the Hong Kong Institution of Engineers (HKIE) to resolve the differences of different disciplines within the profession in coming to an agreement and a consensus amongst them. In the end, complete agreement was reached between the HKIE and the Government and it was put in writing.

Unfortunately, when the Bill was introduced to the Council, or to the Bills Committee, we found that the details as agreed in the letter from the Director of Buildings were not included at all, except the very general clause as stated in the proposed Bill. This was disappointing. But in the end, the Government was quick enough to accept the proposal that a draft AP/RSE practice note could be put forward to the professional body for agreement. Hence, in the end, the agreement was reached fairly soon because the details were actually agreed upon some years back, although they were not included in the final proposed Bill. So, the conclusion reached at the Bills Committee was that the draft AP/RSE practice note was accepted to complete the whole process to ensure that details of the grandfather clause cater for disciplines other than the geotechnical engineering discipline, that is, the civil engineers and the structural engineers, for them to be able to utilize the experience they have had, and also the expertise they have had over the years in their practice, to continue carrying out the work required for complex foundations as well as slope work.

I would like to come to another area. One area which has caused the profession a lot of concern is section 40(2AA). This is to deal with the conviction of offences which is a result of anyone who has failed to notify the Building Authority if he carries out work in accordance with the plans approved by the Building Authority, but in the end, the works are found to be in contravention of the Buildings Ordinance. According to the law as it is since 1955, the person is liable to three years' imprisonment and a fine of $250,000. In fact, the Government proposed in the first place to increase the fine to $1.5 million, and retain the three years' imprisonment term. This was considered to be totally unreasonable because this kind of offence is always considered to be relatively minor, compared with the other offences included in the existing Buildings Ordinance. So in the end, the Government agreed to drop the three years' imprisonment term and retain the maximum fine of $250,000 as it is in the existing law. This was in the end accepted by the professional body.

Also, I would like to point out that the proposed Bill requires the printing of documents which are kept under the Buildings Ordinance to be charged at $38 per copy. This was also considered to be totally unreasonable. In the end, the Government agreed to bring it down to $1.60. All in all, I personally would like to see that this kind of partnership in working through a bill between the government officials and Members of the Legislative Council can continue in future, and also in the scrutiny of other bills in future. So, Madam President, I would support the Second Reading of the Bill. Thank you.