Blog

Application of Innovation and Technology

The development of innovation and technology (I&T) will be the new momentum for our future economy. In recent years, the SAR Government has provided policy support and devoted additional resources to actively promote the development and application of I&T. We foster the development of new industries and at the same time support various trades and industries to enhance efficiency and even upgrade their operation through the application of I&T.

By strengthening support to the adoption of I&T solutions, we hope to provide better development opportunities for I&T solution companies as well as traditional businesses. Specifically, the Government is pursuing relevant work through the following three directions.

Firstly, as one of the major consumers in the market, the Government introduced a pro-innovation procurement policy last month to encourage tenderers to propose innovative solutions. When procuring stores, services and revenue contracts, government departments will no longer solely base on the "lowest bid wins" principle. The overall impact of the tender, such as its technological innovation, how innovative the solutions are, or its other social contributions in the course of public services provision will also be considered.

The new procurement policy encourages procuring departments to make wider use of marking schemes and increase the weighting for quality in tender evaluation from the existing 30% - 40% to 50% - 70%, with certain marks to be set aside for assessing innovative suggestions. The price weighting will be adjusted downward accordingly from the current 60% - 70% to 30% - 50%.

Furthermore, as a general rule under the new procurement policy, tenderer's experience would not be set as an essential requirement. To provide an enabling environment for small and medium enterprises (SMEs) and start-ups, the weighting on tenderer's experience should generally account for no more than 15% of the total technical marks.

This April, we set up a Smart Government Innovation Lab under the Office of the Government Chief Information Officer to invite SMEs and start-ups to submit innovative proposals and product suggestions to improve public services for consideration, adoption, trial and testing.

Secondly, a $500 million TechConnect Block Vote was rolled out in mid-2017 to support government departments to widely adopt innovation technologies and solutions with a view to enhancing operational efficiency and improving public service. To date, the scheme has supported 48 applied technology project with a funding of over $300 million. I injected another $500 million to the scheme this financial year to drive the adoption of technology by government departments for providing better services for the community.

Thirdly, the Government launched a Technology Voucher Programme (TVP) in end 2016 to subsidise local enterprises in using technological services and solutions to improve productivity, or upgrade or transform their business processes. Funding for each eligible applicant will be provided on a 2:1 matching basis. As at April 2019, we have approved about $170 million for over 1220 applications.

The TVP has benefited various trades, including mainly wholesale and retail, import and export trade and professional services. The TVP has also benefited many traditional businesses such as florists, restaurants, Chinese and western clinics, travel agencies, as well as shops selling dried seafood or furniture. With no restriction on the types of technological services funded, TVP applications involve a wide range of solutions, with the more common ones being enterprises resource planning solutions, document management and mobile access systems, electronic inventory management systems, point-of-sales systems, and electronic procurement management systems, etc.

Taking retail industry as an example. Some merchants are still handling quotations, orders and receipts manually. Some enterprises may have adopted computer billing, but their sales and inventory cannot be managed in real time. The TVP encourages SMEs to install retail management system to process and combine orders by electronic means. It also helps frontline staff grasp up-to-date and accurate product information to enhance customer service.

In response to the positive feedback, I announced in this year’s Budget to regularise the TVP and double the funding ceiling per applicant to $400,000. The maximum number of approved projects per enterprise is increased from three to four. Enhancement measures on eligibility criteria, application procedures and application guidelines, etc. have also been implemented.

The above three examples demonstrated part of our enormous effort to promote I&T development in Hong Kong. We will continue to make sustainable efforts to facilitate I&T research and application in Hong Kong, create a better I&T atmosphere and opportunities for start-ups, as well as both new and traditional industries.

May 26, 2019