1. Contested Space: The Role of Civil Society Organizations in Hong Kong Presentation by – Dr Patrick Ho Secretary for Home Affairs Government of the Hong Kong Special Administrative Region Conference on Governance, Organizational Effectiveness, and the Nonprofit Sector Makati City, Philippines 5-7 September 2003

2. 2 Nonprofit sector What is the nonprofit sector? The nonprofit sector comprises mainly civil society organizations (CSOs) CSOs are organizations which operate outside the confines of the market, the government and the family CSOs bring people together in a common cause to solve problems Nonprofit sector is also known as civil society or the third sector

3. 3 Nonprofit sector Role CSOs can find solutions to market failures and to social problems that appear intractable to the Government Policy Government ’ s policy is to encourage and facilitate the development of a vibrant third sector in Hong Kong

4. 4 Policy statement In his 2000 policy address, the Chief Executive said that – “In Hong Kong, voluntary organizations already provide a vast array of services, but still have great potential to improve in terms of both quality and quantity. I hope that apart from having a highly efficient and modernized market economy and a small and effective government, Hong Kong can also boast a dynamic and growing sector of voluntary service. We will continue to enhance our working partnership with these organizations. Together we will build a better future for Hong Kong.”

5. 5 Nonprofit sector The nonprofit sector is a significant social, economic and political force in Hong Kong Social CSOs are major providers of welfare, education and health services Economic CSOs command significant resources Political CSOs are a powerful interest group

6. 6 Conceptual Framework Mandate Market Government Subvented NGOs The public sphere provides funding Advisory committees Statutory bodies Public Authorities appoints CSOs create values become institutionalized Examples: Urban Renewal Authority Hospital Authority Housing Authority

7. 7 Conceptual Framework Interaction among Government, the market and CSOs Government The public Private sector CSOs Non-market fairer allocation of services, guaranteed standards Market better choices, market efficiency pay for services provides services pay taxes provide services provides funding provide services donations

8. 8 Contested space Is the nonprofit sector getting too large in Hong Kong? Are CSOs competing unfairly with the market? Should the Government play a more active role in the provision of direct services?

9. 9 Overview of CSOs Overview of the scope, size, structure and funding base of the nonprofit sector in Hong Kong

10. 10 (a) Scope Kinship groups / clansmen ’ s associations / neighbourhood groups Traditional Chinese charities The “ Big Six ” (NGOs) Tung Wah Group of Hospitals, Po Leung Kuk, Yan Chai Hospital, Pok Oi Hospital, Lok Sin Tong and Yan Oi Tong CSOs (Western-style NGOs) Philanthropic institutions and foundations e.g. Hong Kong Jockey Club, Shaw Foundation

11. 11 (b) Size According to the “ List of Approved Charitable Institutions and Trusts of a Public Character ” (section 88 of the Inland Revenue Ordinance (Cap. 112)), there are 3,896 CSOs in Hong Kong Section 88 organizations are tax-exempt Many smaller CSOs are not registered under section 88

12. 12 (c) Structure Welfare Services (subvention: HK$7.5 billion in 2002-03) (Lotteries Fund: HK$1.4 billion in 2002-03) Primary and Secondary Education (subvention: HK$24.6 billion in 2002-03) Health services (subvention: HK$30.6 billion in 2002-03) Culture, recreation and sports (subvention: HK$0.48 billion in 2002-03) Environmental protection Human rights

13. 13 Funding base Government (grants or subvention) e.g. Lotteries Fund, Community Investment and Inclusion Fund Corporate donations Individual donations – fund raising from the public Large private funds and foundations The Hong Kong Jockey Club Charities Trust Community Chest of Hong Kong Fees and charges for services

14. 14 Issues Public mandate public perceptions of the nonprofit sector competition between the market and CSOs Effectiveness how well the grants and donations are used by CSOs? Transparency How open are these CSOs? Disclosure of interests

15. 15 Issues (cont.) Accountability Responsibility and answerability of CSOs Governance The role of management boards of CSOs and the role of executive staff Role of Government Friend or foe (facilitation or regulation) of CSOs Equal partnership