Urban Council under fire for poor return on cash reserves

The Urban Council was yesterday attacked for earning interest lower than the inflation rate on its $2.9 billion reserves.

Urban Councillor Ada Wong Ying-kay said the council should use the money to improve municipal facilities.

At the Urban Council monthly meeting, Ms Wong asked about the annual return on the reserves and measures taken to increase the return.

Chairman of the Finance Committee Chiang Sai-cheong said the balance, excluding interest earnings, was $2.64 billion at the end of March.

The interest earned during the past two financial years had been $144 million and $257 million respectively. The total balance was $2.9 billion.

The reserves were in fixed deposit accounts at several banks. The return rate was 6.2 per cent and 7.5 per cent respectively for the past two years.