In this year’s Policy Address, there are several measures to improve the environment and pollution including our submission on phasing out old model diesel commercial vehicles with determination. A sum of HK$10 billion is earmarked as incentive to encourage replacement. These outdated models are primary source of pollution on roads. The LegCo Panel for environment of the last term has reached a consensus on replacement and the current Administration is following up with more comprehensive measures. Better late than never, this is indeed the right step ahead.
The Policy Address proposes to phase out highly polluting models of pre-Euro and Euro-1 to Euro-3 by stages based on their pollution levels. There are 88,000 such vehicles based on registration records. If all were replaced by Euro-5 model, overall emissions of particulates and nitrogen oxide would be reduced by 80% and 30% respectively and pollution on roads would be greatly improved. The proposed incentive scheme has also accepted our further view on extending eligibility to surrender of the old model for cancellation of registration.
However, there is no guarantee of results. Apart from financial incentive, the Government is deregistering these vehicles by stages from 2016 to 2019. Based on past experience, the outcome is not necessarily encouraging. With 88,000 vehicles sharing HK$10 billion incentive, each would get only HK$11,000. As a new vehicle costs $800,000 to $900,000, such subsidy would be unattractive. Although old models are being deregistered by stage, owners might strongly resist or simply delay replacement until deadline. If so, pollution would hardly be improved shortly.
Of course, replacing all of them as planned is the best choice. An alternative is to focus on earlier models including pre-Euro and Euro-1 and Euro-2. As Euro-3 is a later model and much less polluting, those 30,000 newer vehicles might defer replacement. Thus, financial incentive for much earlier models might be increased to persuade early replacement for early improvement in air pollution.
Turning to waste management, several measures are proposed this time, including waste charging, building incinerators, developing waste recycle industry and reducing food waste, etc. I support all these proposals but recommend the Government to merge them into one comprehensive policy of territorial energy conservation, waste grouping at source, building incinerators, etc. A more systematic programme would help educate the public on current situation and help solicit public support.
On the question of incinerators, they are inevitable as landfills would be exhausted sooner or later. In fact, incinerators are fully developed and widely used in developed countries in Europe and America. The Government may borrow their experiences in local consultations and coordination, taking into account, of course, sentiments of affected residents.
I now turn to healthcare and my prime concern is funding. The Government is pushing ahead Health Protection Scheme based on outcome of the second round of public consultation on healthcare reform. Studies on scheme particulars would be completed by the end of this year.
In my view, there are two key principles for a health protection plan to succeed. Firstly, development of public and private health sectors should be in balance. As the public sector develops, the Government should also raise standard of services of the private sector to attract participation in HPS and build up a critical mass. Secondly, the Scheme needs support and active participation of the people. Here, the public does not seem to fully understand HPS. I wish the Government would step up promotion and public education to help project right concepts of the Scheme.
On misconceptions of HPS, the public or politicians might take underwriters as prime beneficiaries. This is not the reality. The Government injection of HK$50 billion intended to improve existing arrangements would be spread over 20 to 25 years. On average, it would mean only HK$2 to 2 .5 billion a year. The money would be used for the benefit of the public like universal coverage, life time renewals, diagnosed illness and high-risk pool, etc. Thus, it is government subsidy and the people are definitely prime beneficiaries. Comparing with the annual budget of HK$40 billion of the Hospital Authority, an annual injection of HK$2 to 2.5 billion is small sum. What is imminent to the Government is putting right misconceptions and soliciting more support from politicians and the people. Meanwhile, HPS also needs support of the medical sector including doctors and private hospitals. They should realize that transparent tariffs would help strengthen consumer confidence and service packages would help consumers make better financial planning. All parties would benefit if private medicine becomes more affordable.
Lastly, support of the insurance sector is crucial. The Government is discussing with the industry on scheme particulars. I wish that the Government would keep the scheme “voluntary”. Participation from the public should be “voluntary”. So are underwriters. The Government should also refrain from introducing statutory regulation of healthcare insurance policies before consensus on scheme particulars and agreement with the industry. It would only be counterproductive.
In reality, the insurance industry is acting as goalkeeper in the deliberation of particulars. We are offering our experience for 30 years serving three million customers to help ensure that HPS is viable. Its technical details would be practicable and the scheme is sustainable. I wish responsible officials do realize that unreserved endorsement and support of scheme particulars by the insurance industry are crucial. Do bear this in mind.