Leung Chun-ying

Taxpayer cash proposed to fund new financial services development body

Lawmakers at odds over funding proposals for new development body announced by CY

PUBLISHED : Tuesday, 22 January, 2013, 12:00am
UPDATED : Tuesday, 22 January, 2013, 4:20am

Lawmakers have suggested the newly created Financial Services Development Council could consider applying for taxpayers' money to fund its operations in a bid to quell public doubts over its role and transparency.

The funding source of the 22-member council has been at the centre of controversy since Chief Executive Leung Chun-ying announced its creation in his maiden policy address last week. Set up as a private company, it was initially proposed to rely on donations to balance its books.

In a meeting yesterday with the council's top management, including chairwoman Laura Cha Shih May-lung, some pro-establishment lawmakers suggested its annual operating cost of about HK$20 million could be government financed. It is understood Cha had promised to look into the idea and discuss it with fellow council members.

A pro-establishment lawmaker who attended the meeting said the annual operating costs of the council would range between HK$10 million and HK$20 million and that "can be fully absorbed by the government" to avoid unnecessary speculation over any conflicts of interests.

"To be honest, the donations it receives will be coming from the financial services industry, which could be inappropriate," the lawmaker said. "The council can come out clean by running with public money."

Insurance constituency lawmaker Chan Kin-por agreed, saying he felt the government was caught off-guard by mounting opposition to the council.

"[It] was created to promote the financial market in Hong Kong," he said. "I think it has no problem with public scrutiny."

But pan-democrats were cautious about the funding suggestion.

Civic Party lawmaker Dennis Kwok Wing-hang said the party could not approve any applications for funding unless the council came up with a viable business and development plan.

"It is very unclear what they will actually do," he said. "Its duty is overlapping with five existing organisations."

Democratic Party legislator Sin Chung-kai said: "At present, the council has not yet shown a defined and valuable role to convince us it should use taxpayers' money in the long-term."

Secretary for Financial Services and the Treasury Professor Chan Ka-keung said the government would support the council's staff and expenses for the next three years before conducting a review.

He said it would promote Hong Kong's financial services sector overseas and act as an advisory body for the government. "We would like to see the council start operating first and then review and decide its funding model for the long-term."

He said it was registered as a private company but would be treated as a public body under the anti-corruption law.