Is Paul Chan qualified to handle Hong Kong’s coffers?
Supporters cite his accounting background, but critics question his knowledge of public finances
He is no stranger to controversy, having faced scrutiny over his family’s investment in farmland and subdivided flats, but newly appointed Financial Secretary Paul Chan Mo-po is described by colleagues as hardworking, fully dedicated and willing to shoulder responsibility.
Yet does Chan, as the former development minister whose public opinion ratings have consistently been the lowest among ministers, have what it takes to run the city’s finances?
Speaking on his appointment as the financial chief yesterday, Chan, a certified public accountant, said he felt “honoured” and his priority was to prepare the coming budget.
“I shall also strive to achieve a fiscal balance, to dedicate public resources flexibly for launching various government projects and public services that suit the needs of the community,” he said.
Chan served as a lawmaker representing the accountancy sector from 2008 before he was appointed as development minister in 2012.
“I welcome Paul being appointed the new financial secretary. I have personally known him for a long time through our work on the Hong Kong Institute of Certified Public Accountants ... so I look forward to working closely with him again,” Securities and Futures Commission (SFC) chairman Carlson Tong told the Post.
Tong added that the SFC hoped to also work closely with the stock exchange on market reforms “with the support of the new financial secretary”.
However, some critics the Post spoke to questioned Chan’s ability to take on the finance portfolio.
Joseph Wong Wing-ping, former secretary for the civil service, doubted the relevance of Chan’s experience as he did not deal much with financial markets.
Dr Chung Kim-wah, an assistant professor specialising in social policy at Polytechnic University, concurred, adding that Chan did not have experience with public finance management.
He also questioned Chan’s integrity, citing a series of controversies since Chan took the helm of the Development Bureau.
Between 2012 and 2013, Chan came under the spotlight for issues such as his involvement in the development of a new town at Kwu Tung North, where his family owned 18,000 sq ft of farmland, and a company owning illegally subdivided flats, controlled by his wife. Chan had initially denied knowledge of the flats.
There were loud calls for him to step down, with lawmakers going as far as to pass a non-binding motion on his removal.
But things began to look up for Chan as he scored small achievements as the development chief.
During his time in office, he identified more than enough land for the building of private flats. For public flats, however, Chan’s office only managed to get sufficient land to build 236,000 flats by 2027, short of the target of 280,000.
Andy Kwan Cheuk-chiu, director of the ACE Centre for Business and Economic Research, said he hoped Chan’s new appointment was temporary, adding he was not an ideal candidate for the finance minister’s position.
“Chan has no expertise in public finances. This is very dangerous. The post of financial secretary is not for the purpose of providing on-the-job training,” he said.
“He is an accountant ... He doesn’t know how to map out development plans for the medium and longer terms required by his new job. They involve public spending to complement economic policies, good understanding of banking and the linked currency policies and also the operation of the Exchange Fund,” Kwan added.
Lawmaker Kenneth Leung Kai-cheong, representing the accounting sector, called the appointment a strange and rushed decision with only five months to go before the end of the term for the incumbent administration.
“Are there any justifications for this short-term arrangement? After all, he needs at least three to four months to adapt himself to it,” Leung said, adding that the financial secretary needed to have good relations with the mainland and international monetary regulators.
Insurance sector lawmaker Chan Kin-por, however, described Paul Chan as diligent and fully committed to his work, saying that he had the relevant experience, and was well respected by subordinates as he was willing to shoulder responsibility.
But whether the new minister will be able to work with the legislative arm is something many are waiting to see.
In the latest approval rankings by the University of Hong Kong’s public opinion programme, Paul Chan came in second last, with Secretary for Education Eddie Ng Hak-kim faring the worst.
Chen Hongtian, chairman of Shenzhen-based Cheung Kei Group, which owns businesses in property and finance investment in Hong Kong and the mainland, said Chan should “focus on how to integrate with Shenzhen to enhance Hong Kong’s growth”.
Chen cited the recent plan to turn the Lok Ma Chau Loop into an innovation and technology park as a good start.