An official investigation into the Hong Kong Special Administrative Region government multimillion dollar bottled water procurement scandal unveiled in August last year has found that three officers from the Government Logistics Department (GLD) failed to fulfil their duties satisfactorily.
Due to failures in leadership, the department’s former director, Carlson Chan Ka-shun, although not directly responsible, was not awarded a Silver Bauhinia Star medal despite being previously nominated.
Xin Ding Xin, which had won a HK$52.9-million ($6.8 million), 36-month contract to supply bottled water to government offices across Hong Kong Island and the outlying islands, was found to have used forged documents to win the government tender.
Announcing the result on Tuesday, Secretary for the Civil Service Ingrid Yeung Ho Poi-yan said the investigation, after probing over 20 officials from the GLD, Financial Services and the Treasury Bureau, and the Food and Environmental Hygiene Department, found the trio from the GLD “lacked necessary vigilance and judgment” and missed key chances to spot and report issues.
Two of them — including a directorate-level officer — showed “insufficient ability to identify, judge, and analyze” in procurement work, falling short of their grade’s standard, Yeung told reporters.
The authorities will initiate formal disciplinary proceedings against the pair, and punishment will be decided based on the findings of the disciplinary inquiry, Yeung said. She added that they will not be granted a salary increment due to their negligent work.
The third officer will be served written advice requiring significant improvement in the future; the officer will also not be granted an increment.
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Yeung said that the inquiry found no negligence on Chan’s part throughout the incident, as it primarily stemmed from subordinates’ failure to report a suspected problem, which Chan was not aware of at the time.
However, the investigation reflects a “pervasive” gap among Chan’s departmental staff competency, Yeung noted, adding that authorities reckoned the ex-chief should have done more to enhance training, and have decided to withdraw Chan’s Silver Bauhinia Star medal — one of Hong Kong’s top honors which he had been previously nominated in recognition of his 37 years of public service.
Chan was excluded from November’s presentation ceremony for the Silver Bauhinia Star pending the inquiry’s results.
Yeung stressed: “It is rescinding an honor, not a punishment.” The government has informed Chan of the removal of his Silver Bauhinia Star and explained the reason, she added.
Also at Tuesday’s briefing, Secretary for Financial Services and the Treasury Christopher Hui Ching-yu released another report on reviewing the government’s procurement mechanisms, in a bid to uncover systemic procurement loopholes and introduce improvement measures to avert future lapses.
According to Hui, the review, finalized late last year, outlined a four-part strategy for ameliorating the government’s current procurement procedures, namely, to bring institutional changes to strengthen inspections of departments’ procurements and contract management, enhance cross-departmental information sharing, build a culture of ownership at work, and make greater use of technology, such as artificial intelligence for contractor vetting.
Following the six quick-win measures announced in October last year, new key policy levers include a mandatory financial vetting for goods contracts valued over HK$15 million, and revised bidding and contract terms that allow the government to terminate agreements with immediate effect for public interest reasons.
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“Many of the proposed measures are already in effect in current tendering projects, including the new drinking water tender,” said Hui, “the government is committed to refining procurement procedures to ensure services and goods obtained in the future deliver ‘due value for money’.”
