Perfect model of a pseudo-statutory body

PUBLISHED : Monday, 27 July, 2009, 12:00am
UPDATED : Monday, 27 July, 2009, 12:00am

Whether we are happy about pseudo-models taking our annual book fair by storm or whether their racy photo albums deserve to be called books makes for lively dinner-party chat. These pseudo-models and pseudo-books actually have a lot in common with the fair's organiser, the Trade Development Council.

Officially, the TDC is a statutory organisation - a public body responsible for promoting Hong Kong's external trade in goods and services. As a public body, it is supported - though not entirely - by the public purse, which gives the TDC more than HK$300 million annually. Since the council's creation in 1966, the government has been fully supportive of its work, as it has certainly played a crucial role in Hong Kong's then-manufacturing economy. The government provided not only funding, but also land (prime property and reclaimed land) for it to house its shows and fairs.

But unlike other public bodies, such as the Tourism Board and the Arts Development Council, the TDC is not subject to the scrutiny of the Audit Commission. So it is anyone's guess whether we are getting our money's worth, however hard it is to imagine how the pseudo-models at the Convention and Exhibition Centre are conducive to promoting external trade in goods and services.

Officially a public body but technically answerable to nobody - not even government auditors - the TDC is a pseudo- statutory organisation, at best. In reality, it looks more like a private business. As critics of the book fair point out, the TDC runs these shows not so much for trade promotion, but because they are a good business.

By organising large fairs and trade shows at its own venue, the TDC gets to collect rent, too. However, we would never expect the Consumer Council to make consumer products or run retail stores. But there is a lot of money to be made for being both organiser and venue provider, and it is no wonder, then, that TDC directors' salaries are 'performance'-based - very much like the heads of banks and large corporations.

The TDC's top management receives, on top of their salaries, bonuses, benefits and allowances. Its latest annual report reveals that its executive director received more than HK$6 million in salary and performance pay, making the TDC's pay packages almost as attractive as those at the Monetary Authority. In fact, pay packages for TDC top management total more than HK$21 million for 2008-09.

With public funding as its seed money, the TDC has made a fortune for years but the money is not funnelled back into the public purse. While profit-driven incentives may work well for commercial entities (although even executive pay has become a cause of public outrage during the financial crisis), how does that work for public bodies? Common sense tells us that 'profit-driven public bodies' is oxymoronic.

And so, it seems, the TDC has been enjoying the best of both worlds: government support - not only in real money terms, but in the freedom to run its operations like a commercial entity - but without government or public scrutiny of its work, operation and effectiveness. It is a private corporation when it comes to running shows, making profit and paying its executives. But, when it comes to getting government funding and land for expansion projects, it is a public body.

It's time the government took a long, hard look at its so-called non-departmental bodies. Past lessons, like the Tourism Board insurance package scandal, the management of the Equal Opportunities Commission and the debate about the pay of the Monetary Authority chief may say more about the government than they do about the organisations themselves. And officials must begin by examining the pseudo-public/private entity it has created in the TDC.

Alice Wu is a political consultant and a former associate director of the Asia Pacific Media Network at UCLA