On 27 September 2001, we held a forum on one-line vote (OLV) arrangement with all OLV departments. 28 representatives joined to share their experience in operating the one-line vote arrangement.

For vote-funded departments, virement between components requires approval of the Finance Committee or the Finance Bureau. OLV places all recurrent expenditure provided for the operation of a department, other than specified exceptions, under one single subhead (i.e. Subhead 000 Operational expenses), which operates on a cash-limited basis. Within his subhead, the Controlling Officer is given autonomy and flexibility in deploying the funds between various components and items of expenditure to suit his department's needs and changing circumstances.

At the forum, most participants shared the view that OLV gave them the flexibility to vire from Personal Emoluments (PE) to Departmental Expenses (DE), e.g. for employment of contract staff. For example, Transport Department hires service to do the night time surveys to relieve the civil servants from working overtime. Intellectual Property Department (IPD) contracts out despatch service, typing, scanning and data input service and employs contract staff to reduce cost and to meet fluctuations in demand. To save money from DE, they provide a handy facility for the public to download forms from IPD's website instead of providing printed standard forms.

The Commissioner of Police has delegated authority to the budget officers to utilise the funds under Subhead 000 allotted to their control. The greater funding autonomy for virement of funds speeds up the decision-making process in resource management, enabling budget officers to redeploy funds to meet urgent operational requirements, such as employing non-civil service contract staff for some computer-related projects, and contracting out cleansing services, translation services and towing services instead of recruiting to fill vacant posts.

Another benefit is that the authorisation process is much shortened and virement of funds between components is done collectively in one go rather than in a piece-meal manner.

In general, many departments find that together with the EPP initiatives, the arrangement has encouraged more innovative thinking among supervisors and managers in better utilisation of resources.

While enjoying the benefits of OLV arrangement, most departments have had to take up bigger challenges due to a tighter and closer budget control/ redeployment/ utilisation environment and management's involvement in decision-making under OLV. Such efforts are worthwhile as departments can have greater flexibility in utilisation of their own resources.

Internal arrangement
Most departments hold internal forums and meetings periodically to discuss the economic use of resources and utilisation of savings.

For example, Water Supplies Department has just conducted a LAFIS review to enable budget holders to have access to LAFIS, which captures the latest position on the availability of funds.

Hong Kong Police Force has strict guidelines which do not allow virement of funds for spending on entertainment, training and overseas duty visits which come under the ambit of Subhead 149.

Reaction of Staff
The OLV flexibility and autonomy is generally welcomed by Unit Heads, manager and staff. For example, Civil Service Training Development Institute shares the view that starting from the second year of operation, budget holders have developed a sense of certainty and ownership. Management is able to set longer term plans and targets as underspending in one year can be saved up for spending in subsequent years under the Save & Invest account.

Departments suggest that instead of the current arrangement for quarterly reports to the Finance Committee, they should only report in the last quarter of the financial year as virement of funds is more significant towards the end of the year.

Some suggest that OLV with a multi-year budget and automatic carry-forward of underspending to the next year may provide more certainty and enable departmental management to more effectively plan on a longer-term basis. In their experience, many projects last more than one financial year.

We will look into these suggestions. In light of the encouraging results, we consider it timely to roll out the one-line vote to more departments.

Finance Bureau
October 2001


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