Official challenges deal with Telecom

PUBLISHED : Wednesday, 05 May, 1999, 12:00am
UPDATED : Wednesday, 05 May, 1999, 12:00am

The Government was challenged yesterday on whether it had an exclusive agreement with Hongkong Telecom to provide services to a department even though its franchise had been terminated.

Public Accounts Committee chairman Eric Li Ka-cheung said there were fears the telecommunications giant would continue to monopolise provision of such services for the Civil Aviation Department.

Mr Li asked if it was going against government policy to open up the telecoms industry.

He also quoted the Auditor's Report in asking if Hongkong Telecom would stop providing services under current terms after it was given $6.7 billion to compensate for the termination of franchise.

Under an agreement, the company is providing technical support services for the department on systems maintenance and design.

Secretary for Information Technology and Broadcasting Kwong Ki-chi denied the current agreement had anything to do with the compensation.

'I don't understand why the Director of Audit put these two things together. They are completely separate. The money was to exchange the termination of the franchise,' he said.

Secretary for Treasury Denise Yue Chung-yee said the Government was able to choose other services providers under the agreement which would expire in 2006.

She said the administration would review whether to continue to pay for Hongkong Telecom's support services in the long term.