The new facility would adopt an enhanced approach to child care as part of a pilot scheme to be proposed by a review committee, which was set up last month to examine the city’s residential child care and related services.

The review followed reports of child abuse last December at a facility in Mong Kok run by the Hong Kong Society for the Protection of Children (HKSPC). Police have arrested 34 of the group’s employees for allegedly abusing 40 youngsters at the Children’s Residential Home, which housed about 100 toddlers who were abandoned, orphaned or lacked adequate support because of family problems.

The scandal has triggered a public outcry and raised concerns about both the quality of services and the level of government supervision at residential care centres for children.

In response to the incident, the HKSPC replaced several senior executives, improved the ratio of carers to residents and overhauled operations at its Mong Kok facility. It also installed Subrina Chow Shun-yee, 51, who previously worked as an administrative officer for more than 25 years, as its new director on Friday.

On the same day, legislator Bill Tang Ka-piu questioned the decision to allow the organisation to continue operating with the support of government subsidies.

“If these subsidised service providers committed such a huge thing and violated the government’s guidelines, will the government continue subsidising them and keep the service agreement with them?” he asked.

Law acknowledged that punishing the service provider was one way to respond to the scandal, but he also said authorities needed to consider if there were better options and base their decision on the best interests of the children under care.

He added that authorities had been left with few options for how to respond to the scandal due to a lack of alternative residential child care services.

“When a service is in severe shortage with no space capacity, it is extremely difficult to suspend any service provision,” he said. “Only with enough spare resources, including manpower and premises, can we cope with the emergency situations.”

Currently, only two operators, HKSPC and Po Leung Kuk, provide residential child care services for children under three years old.

But the minister said the government would not rule out the option of suspending HKSPC’s service.

The government would test out different child care modes at facilities while also encouraging more operators to join the sector, he said.

Law also said at the meeting that the Social Welfare Department had implemented several reforms, such as requiring all providers of residential child care services to install closed-circuit television systems, establishing monitoring policies and mechanisms, adding a health inspector to the oversight team and requiring universities to incorporate topics on child protection into relevant courses.

Last week, the Committee on Review of Residential Child Care and Related Services, which is chaired by Director of Social Welfare Gordon Leung Chung-tai and includes legislators, experts and welfare groups, held its first meeting.

The first phase of the review, focusing on care services for children aged under six, is expected to be completed in September. The second part, which will look at other types of services, will be finalised in March next year.