Contested Space: The Role of Civil Society Organizations in Hong Kong

Conference on Governance, Organizational Effectiveness, and the Nonprofit Sector

Makati City, Philippines 5-7 September 2003

Presentation by – Dr Patrick Ho Secretary for Home Affairs

Government of the Hong Kong Special Administrative Region

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 2

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 3

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.” 4

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 5

Conceptual Framework

Mandate Statutory bodies Advisory committees Market Government appoints Public Authorities Examples: Urban Renewal Authority Hospital Authority Housing Authority The public sphere CSOs Subvented NGOs 6

Conceptual Framework

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

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?

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Overview of CSOs

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

(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 10

(b) Size

   According to the Public Character ” “ List of Approved Charitable Institutions and Trusts of a (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 11

(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 12

Funding base

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

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 14

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 15