Days before the powerful Preparatory Committee convened in Beijing on Thursday, China's top man on Hong Kong policy, Lu Ping, declared its mission was largely accomplished. Speculation had increased that the 150-member body would call it a day at the end of its ninth plenary session yesterday. Then committee chairman Qian Qichen made it clear on the eve of the plenum on Wednesday that they would just 'terminate its work in due course'. The body formed in January last year to spearhead the establishment of the Special Administrative Region, said Mr Qian, 'does not need to be disbanded'. The differences, however, go beyond semantics. The takeover body is still seeking to strike a balance between those who want to give a free hand - at least be seen to be - to the SAR on one hand and those who insist the committee still has a role until the first legislature is formed. Faced with conflicting calls from members, committee leaders have opted for a compromise, if not an inconclusive conclusion. Tasked with laying the building blocks for the SAR, the committee has in the past 18 months performed a balancing act in resolving problems and disputes in the final stage of transition. On the Sino-British front, the Preparatory Committee's main task was to vet any major decisions made by the British Hong Kong administration ranging from economic to social policies to make sure they fall in line with provisions in the Basic Law. More importantly, it had to dismantle systems and laws adopted under the Patten administration deemed a breach of the post-handover constitution and the Joint Declaration. The committee also had to put in place a provisional legislature which could give immediate effect to a number of 'indispensable' laws after midnight on June 30 following China's decision to terminate the lifespan of the 1995 Legco. Another major task is to seek replacement provisions to the Societies Ordinance and the Public Order Ordinance for the parts that were struck off by the Chinese National People's Congress Standing Committee because of alleged violations of the Basic Law. Adamant that the change of sovereignty is more than a change of flag, China has insisted that it has the right to scrap reforms adopted by the pre-July 1 administration that they consider out of line with the Basic Law. It is under the same line of argument that Beijing has maintained that any franchises and 'major policies' that straddle the handover have to gain the endorsement of the Chinese Government. Deeply suspicious of the motives of the departing sovereign, the Preparatory Committee has been in no mood to take any chances in its preparations for the handover by trusting the British Government. More than 600 pieces of law are being vetted. Wide-ranging as the tasks are, it can be argued that the Preparatory Committee has exercised restraint. This is despite the fact that a number of decisions made by the committee have drawn fierce attacks from some quarters. Take the provisional legislature. Firm on its legality and necessity, Beijing has admitted it is not the ideal solution. Despite the fact that there are still sharp criticisms and threats of a lawsuit against it, China has tried to impose restraints on the power and jurisdiction of the body. Faced with the political reality of an unpopular and legally-challengeable provisional legislature, the Preparatory Committee has tried to keep the damage to a minimum. It believes any move too far in the wrong direction would damage the smooth transition towards Chinese rule. The same contradictions emerged over the vetting of laws that were being enacted after the Bill of Rights Ordinances were introduced. In the face of scathing attacks from the community and abroad, the Preparatory Committee has decided to shorten the list of laws to be repealed in full or part. The amendments to the Societies and Public Order Ordinances, the committee and Beijing have argued, were already a concession and constituted a bottom line. Chinese officials and Tung Chee-hwa do not want to say it publicly, but the fact of the matter is that it is impractical and politically unwise to dump all laws and policies adopted during Mr Patten's reign, as Singapore patriarch Lee Kuan Yew has already suggested. That would only create more problems in the most sensitive phase of the transition. While a firm hand in dealing with London is important, senior Beijing leaders have found it equally important to deal with the emerging 'internal contradictions'. Behind those contradictions are different vested interests and beliefs over the high degree of autonomy for the SAR. It is clear that different views have surfaced within the Preparatory Committee as well as China's power organs on Hong Kong affairs. In a rare show of discord, the Hong Kong and Macau Affairs Office and the local branch of Xinhua were divided over whether a fraternity body of local Chinese enterprises should be given a seat in the first legislature. More fundamentally, local and mainland members also hold different views on precisely how much leeway they should allow for the future government to devise a set of electoral arrangements for the 1998 legislature. Beijing has risked criticism by laying down 'guiding principles' and a set of broad outlines on how the 60 members should be chosen. This is because China holds a strong view and wants to influence the electoral arrangements. They want their views to be endorsed, but do not want to have their fingerprints on the decision. They want pro-democracy activists to take part in the future political structure, but do not want to see, and cannot tolerate, their dominance. Chinese officials want to be seen as flexible on the electoral options and respectful towards the future government. But the truth is that some options such as single-seat, single-vote are considered as non-starters and they want the future government to respect their 'flexible' proposals. In his opening address, Mr Qian said it was 'totally necessary' that the electoral methods for the first legislature be devised in general but not in great detail to enable the SAR government to make its own decision. By handing down a shortlist of options on electoral arrangements, the Beijing-appointed Preparatory Committee will face criticism that it is attempting to dictate the SAR's electoral rules. The political price is too high for an electoral method that may ultimately serve only to reduce the handful of seats now taken up by the Democrats and their allies. Beijing can win many hearts and minds in the local and international community by giving a genuinely free hand to the SAR.