The LCSD is solely responsible for distributing grants to NSAs and other sporting organisations and for organising sporting activities. The subvention covers general administration, personnel expenses and spending on programmes by NSAs. Sporting organisations use the subvention mainly for arranging programmes for sports.

During the year, 57 NSAs and 28 sporting organisations were provided with funds amounting to about $150 million by the department. Over 8 100 programmes for different sports were organised by the NSAs and other organisations, attracting over 650 000 participants. Among the most popular programmes were the Youth Football Scheme, the New Generation Table Tennis Training Courses and the Youth Windsurfing Promotion Scheme.

In 2006, the NSAs were given subsidies under the scheme to organise international events in Hong Kong. The events included the Volleyball World Grand Prix, Hong Kong International Dragon Boat Race, Tennis Champions Challenge and ITU Hong Kong International Triathlon. These international events were held also to promote Hong Kong as the 'Events Capital of Asia.'