A top adviser to Chief Executive-designate Tung Chee-hwa has supported a government suggestion the Hong Kong Monetary Authority manage the Land Fund. The proposal would boost international confidence in the continuity and management of the massive reserves, Special Administrative Region (SAR) executive council member Antony Leung Kam-chung said. Land Fund officials reportedly want the fund's independence maintained after the handover to invest in long-term projects with high returns. Mr Tung has said he will decide on the fund in the next few months. The fund's chief executive, Chung Shui-ming, is also on the SAR executive council. The Joint Declaration says the Land Fund will be handed to the SAR government after July 1 but does not specify its management. Three mainland-appointed Hong Kong trustees run the fund, which comprises half the proceeds from government land sales since the Joint Declaration was signed. 'Putting the Land Fund under the monetary authority gives a clear message that it will be the same management which handles the reserves,' Mr Leung said. 'There won't be misconception over the management of reserves. If we create a separate fund agency, people will doubt whether there might be some hidden deficit behind our surplus. 'There should be clear continuity after the Hong Kong Government becomes the SAR government. Politically, it looks much better and will boost confidence.' Mr Leung, managing director of the Chase Manhattan Bank, suggested transferring the Land Fund's staff and cash reserves to the monetary authority after June 30 was reasonable. 'The whole team should be responsible to [monetary authority chief executive] Joseph Yam Chi-kong.' It has been argued the Land Fund Office should continue to manage the fund, considering the high returns made in the past. Another suggestion was the fund be used to develop long-term social and economic projects. Mr Leung said it was unfair to compare the return performances of the monetary authority and the Land Fund Office. Given its major task was to stabilise the Hong Kong dollar, the monetary authority's Exchange Fund could only be invested in low-risk items such as short-term bonds, he said. Mr Leung said the authority could treat the $140 billion Land Fund separately, allowing the fund to have its own risk parameters and expected returns.