Suggestions of sinister dealings are completely groundless

I wish to respond to the serious allegations of impropriety against my department made by Jake van der Kamp in his 'Monitor' column (South China Morning Post Business, January 18).

He casts doubt on the process leading to the award of contracts for the supply to the public of subsidised particulate traps for light diesel vehicles to help reduce pollution from such vehicles. He suggests we should have published the specifications for the devices and called for tenders.

That is exactly what we did do. The specifications and the call for tender were well publicised and briefings were held for prospective tenderers. Furthermore, we made use of a completely independent panel of academic and trade experts to determine which of the 17 tenders eventually submitted were able to meet the specifications. Only two devices were judged to be acceptable by this panel and one was significantly cheaper than the other.

Mr van der Kamp further suggests collusion or something sinister was involved in fixing the level of government subsidy to vehicle owners purchasing the devices at exactly the level of the price of the cheaper of the two selected devices.

There was nothing sinister about this. It was a straightforward decision, made public, to only offer the subsidy at the price of the cheapest conforming product, otherwise we would have been wasting public money.

What seems to have sparked Mr van der Kamp's interest are assertions as to excessive profits being made by the cheapest conforming tenderer. If it is true that they have made a healthy profit I fail to see what should have been done to avoid this. The exercise was conducted as a normal, transparent government tendering exercise subject to market forces and competition in line with international practice. And the cheapest conforming tender basically won.

Perhaps Mr van der Kamp is suggesting that the Government should place a restriction on allowable profit margins in future tendering exercises. Apart from it being almost impossible to assess potential company profit margins I fail to see how this would allow Hong Kong to fulfil its international obligations to provide open and free competition in procuring government services.

Mr van der Kamp also refers to another upcoming procurement exercise for similar pollution control devices for heavy duty diesel vehicles. Due to the technical complexity of these particular devices we will get advice from an international panel of experts. To promote competition, we have already sent the draft specifications for the devices to approximately 300 potential suppliers and international professional and trade bodies and drawn the attention of local consulates to the impending tendering exercise. It will also be conducted in a fair and open manner in line with international practice.

ROBERT J S LAW

Director of Environmental Protection