Speech on the “Motion of Thanks” (Translation):

　　Deputy President, I rarely spoke on this topic in previous years since I am not well-versed in economic development. But this year, I would like to talk about the healthcare industry. Over the past few years, the last-term Government stated that it would promote the six industries where Hong Kong enjoys clear advantages, including the healthcare industry. The Chief Executive, in paragraph 42 of the Policy Address, pointed out that "In promoting the industries over the past four years, we have identified certain issues that need to be addressed. For example, our medical sector is facing manpower shortage, and the public is divided as to whether education services should be regarded as an industry. The need to meet local demand also clashes with the need to promote the growth of these two industries.". Therefore, in his Policy Address, the Chief Executive has pointed out that a review and study is necessary.

　　After reading the Chief Executive's description, I felt quite worried. First of all, I would like to point out that in the Policy Address, the Chief Executive said, "In promoting the industries over the past four years.". As pointed out by many Honourable colleagues, although the Government proposed to promote the six priority industries, nothing has been done in relation to any of them, not to mention the healthcare industry. What we need most is land. The four plots of land proposed by the last-term Government are still pending tender offers. It is heard that tenders would fall through. As regards the completion date, it is nowhere in sight. Regarding the issue of "doubly non-permanent resident pregnant women" mentioned, it is not intentionally developed by the Government. It is simply because Mainlanders can get Hong Kong identity cards for their children born in Hong Kong. In fact, this should not be regarded as an industry since it is not intended by the Government. Actually, nothing has been done by the previous Government to promote the healthcare industry.

　　Secondly, I see that the Chief Executive labels non-residents as the target customers of these industries. I consider it a wrong concept. In Hong Kong, even the Disneyland or Ocean Park could run into deficits if they do not receive local guests. You must always have 30% to 40% local guests to sustain the operation. Therefore, the domestic demand is indeed part of an industry. A number of Honourable colleagues just now recommended developing various types of marketplaces in some districts. These also seek to serve the local people.

　　In the past few years, I have recommended to many officials the healthcare industry. How significant is the contribution of the healthcare industry to our economy? In fact, it is a high value-added sector. For example, if the weekly business turnover of a 300-bed private hospital is $100,000, the annual revenue would be $1.5 billion assuming an 70% occupancy rate in 52 weeks a year. In contrast with a 300-room hotel, how comparison can be made? Assuming that the rent of a hotel room or the relevant income is about $2,000 per night and it is fully occupied for 365 days a year, the revenue is only $440 million. Thus, the medical care industry is a fairly high value-added sector. What we need is just land. The Government has given us four plots of land, which are in fact very remote since they are located in Tai Po, Tseung Kwan O and Tung Chung respectively. If hospitals are constructed on these four plots of land for use by Hong Kong residents, it would be very difficult to break even.

　　Why are sites at remote locations allocated for such purpose? Because the last-term Government considered that a fairly large plot of land was needed for building a private hospital. I wonder why the last-term Government did not first conduct a market research or survey before implementation. In fact, amongst the existing 12 private hospitals, the largest single plot of land occupied is no more than 1 hectare with the smallest one being only 0.3 hectare. A hospital must be close to the residential areas for the convenience of patients living nearby.

　　Recently a private hospital was found to be making a handsome profit and even profiteering despite claiming itself a non-profit-making body. The profits have been transferred to its affiliated or holding company. Thus, some newspapers have called for a halt of development of private hospitals on the ground of their confusing situations. I am very surprised. If development is stopped, would the existing private hospitals not become more arrogant and would it not be more difficult to regulate them due to insufficient beds in hospitals? To be reasonable, the Government should consider this point. Since the healthcare industry can make profits, why should they be forced to be non-profit-making organizations? If they are profit-making, the Government should charge the market premium on the land they operate. The simplest solution is to put the land on the Application List, for instance. By putting eight to 10 plots of land of different sizes on the Application List for tender, the Government could collect revenue when operation by the market has commenced. Of course, the Government should provide sufficient land because insufficient land supply will lead to soaring prices as in the case of the residential market.

　　Some friend of mine have asked this question. How could the healthcare industry be developed with a shortage of manpower? Let me do some calculations. How much manpower is required in a 300-bed private hospital? Only 70 doctors and 300 nurses are needed. How many doctors and nurses are there in Hong Kong currently? There are more than 12 000 doctors and 40 000 nurses in Hong Kong, in addition to at least 300 medical graduates every year. Why should there be a shortage of manpower? The so-called shortage of manpower is due to the mismanagement by the Hospital Authority (HA) and the problematic personnel management system which has caused the understaffed situation of several departments and clusters. But this is the problem of the HA instead of the shortage of doctors in Hong Kong. The local private healthcare market is sufficiently staffed currently, particularly in obstetric services. Last year, they served 30 000-odd pregnant Mainland women. You can see how much spare capacity they have in this year when such business has gone.

　　I would like to cite the incident of infant formulas as an example. I saw an irrational way of dealing with the problem, thus turning an apparently good thing into a bad thing. When friends in the Mainland have no confidence in the quality of goods produced in the Mainland and come to Hong Kong to buy infant formulas, it is obviously a profitable business for Hong Kong. Why do we not continue to do the business? I must declare my interest first. I have a one-year-old son on No. 3 infant formula and a one-month-old daughter on No. 1 infant formula. These are non-expensive infant formulas. My wife told me that the prices of No. 3 and No. 2 infant formulas are $160 and $200 per can respectively. Since these infant formulas are cheap, the supply should absolutely not be a problem. No one will scramble for them as they can be purchased easily. When people come to Hong Kong in order to scramble for expensive infant formulas here, we can consume cheaper ones. There is no problem at all. My children grow fat and healthy by consuming these formulas. There is no problem at all.

　　If the wholesalers do not have any problem in getting supplies, it should not be difficult to meet the demand of local people. I propose that non-governmental organizations (NGOs) buy infant formulas from wholesalers direct. Then in districts where supplies are tight, the Government can co-operate with the NGOs so that the latter will provide a venue for stocking these infant formulas for purchase by Hong Kong people. In fact, I think it is easy to resolve the problem of shortage in supply due to panic purchase in individual pharmacies. I hope the Government will understand that the crucial factor in developing an industry is data. Data play the most important role. Empty talk is useless. It is the right direction if matters are handled in a rational manner.

　　Deputy President, I so submit.