All the normal rules regarding government contracting out and assignment of rights to government activities were bent when the American Chamber of Commerce was given the exclusive rights to organise the Fest through a private firm set up by its chairman and his wife. This was despite their lack of expertise or experience in show business. Even the public relations firm hired to help was only set up solely to accept contracting by Amcham.

No senior officials raised any questions about such irregularities. The project was treated as an entirely 'private' business, even though it was predominantly underwritten by government funds. With InvestHK chief Mike Rowse, and the new Financial Secretary, Henry Tang Ying-yen, repeatedly getting the details of the project wrong, and some of the crucial facts only being exposed under media pressure, one wonders if the government takes seriously responsibility for public expenditure.

All the virtues of public-private partnership, favoured by most governments, cannot be used to justify such a blatant absence of accountability. As this saga ends, public suspicion is growing over another, much larger project. Architect's groups, cultural and planning organisations, and some developers, have criticised the government for its intention to award the West Kowloon cultural district project to one developer - even though it will be open to tenders from everyone. By taking this approach, instead of inviting multiple developers to participate in contracts for different parts, the government stands accused of favouring the city's biggest developers.

On the surface, the single-developer approach cuts the government's chores. Chief Executive Tung Chee-hwa promised in his 1999 policy address that a major performance venue would be developed on the West Kowloon reclamation site, with world-class facilities to make Hong Kong the events capital of Asia. In these times of fiscal restraint, however, the government prefers a quick-fix solution of contracting out the whole project to a major developer that will finance the construction and operation of the cultural parts of the development by income generated from the profit-making commercial components.

The same mentality was behind the Cyberport project, awarded by private treaty in 1998. Acclaimed as Hong Kong's version of Silicon Valley, it has turned out to be essentially just another property development. The government has to learn from the Harbour Fest's problems of a lack of transparency, accountability and community ownership.

Many in the cultural and performing arts community wonder why the government can be so sure that developers in Hong Kong know enough about the arts not to sacrifice design and quality for business interests and profit. Harbour Fest is seen as a bad example of public-private partnership, leaving many to dread the prospect of having Hong Kong's future cultural landmark put in the hands of an inexperienced private-sector partner.

It is not as if the government has been great on design - the cultural centre and the central library have both been criticised. But if Hong Kong is to have its own Guggenheim or something comparable to Singapore's Esplanade, the government should not discard its important steering role. The public's role has to be expanded, not contracted.

The use of commercial development profits to finance the cultural site, as a self-funding deal to secure completion within a short timeframe - without getting bogged down by red tape - is attractive. But by over-emphasising the developer's role, the government has put the project into the classic mode that most developers in Hong Kong are most familiar with.

There are alternatives. The cultural and commercial parts of the West Kowloon project can be separated. Hong Kong can follow Singapore in setting up an institution of a public character, which can receive tax-deductable donations. Or it can adapt its home-grown corporate model used to construct and operate the airport on principles of financial prudence.

A cultural corporation or consortium on the public-private partnership basis can be established - with government contributing the land premium and some development rights, and private investors contributing the development monies - but also incorporating local planners and cultural groups. This corporation can take full responsibility for planning the project, calling in worldwide bids for its various parts to ensure fair competition - and getting the best. The corporation should continue to manage the facilities, through a professional management arm.

Anthony Cheung Bing-leung is a professor of public administration at City University of Hong Kong and chairman of SynergyNet, a policy think-tank