16 Dec 2009
Members' Motions 'Public Officers Pay Adjustment Bill’
President, I came from the grassroots and I had worked for more than 10 years before I started my own business. Most of my friends and relatives are also wage earners. I understand very well that wage earners do not in the least like to have their salary slashed. I was also a civil servant before and I also worked in a subvented organization for a few years. Therefore, I know how the some 10 000 civil servants and a sizable number of employees in subvented organizations would feel. Furthermore, there are a large number of friends from the accounting sector in the Government and in the subvented organizations. There are also friends not belonging to the accounting sector which are also affected by this proposed pay cut.
President, although I have not joined the Bills Committee to study the Public Officers Pay Adjustment Bill, I have all along been mindful of views put up by civil servants and subvented organizations. Actually, I have also received many of their letters lobbying for my support in that issue and with respect to the views and arguments they have put forward, I have studied them carefully and to a certain extent, I sympathize with those affected. I know that the pay cut will create impacts of various extents in many aspects for them. But to be honest, I cannot accept some of the arguments they have put up and after pondering over these, I think that a pay cut is necessary, though it is a move made under most reluctant circumstances.
I am a Member of the Legislative Council and although I come from the accounting sector and I am concerned about the interest of my voters, in considering government policies, legislative proposals or funding applications and such like matters where public interest is at stake, my first and foremost duty is to approach the issue from the overall interest of Hong Kong. On this occasion, the Government proposes that the salary of directorate staff and senior civil servants will be reduced by 5.38%. My concern is whether or not the Government is acting according to some established mechanism, whether or not the procedures involved are fair and just and whether all factors that should be considered under the mechanism are considered. I would also take into account whether or not there has been any deviation from common sense when these factors are considered in the process of policy-making, such that the results would not be acceptable.
The existing civil service pay adjustment mechanism includes a feature and that is a regular pay trend survey. This pay trend survey system has been in place since 1974 and surveys are conducted each year with authorization from the independent Pay Trend Survey Committee with members from three parties. These are: Ten representatives from the staff side representing the four central consultative councils, three representatives from the management, that is, the Government, and three members from the two advisory bodies on civil service pay and terms of service. Results of the pay trend surveys will be listed according to the ranks of civil servants, that is, senior, middle and lower levels which are classified according to their pay. The gross pay indicators for each salary group after deducting the relevant expenses in civil service salary increments will be the net indicators for the pay trend.
President, I think that since the civil service pay adjustment mechanism has been set up for a very long period of time and has been in use and never been replaced, we should act according to this mechanism. Unless there are very special reasons for adjustment, we should not deviate from this mechanism.
Information over the past 10 years show that there are indeed a number of years in which civil service pay adjustments differed from the net indicators of the pay trend, for example, in 1999-2000 and 2000-2001, the net indicators registered some negative figures (-0.13 to -1.97%) and a slightly positive figure (0.84%). In these years, in accordance with the mechanism, the authorities decided on a pay freeze after considering all the factors and no adjustment was made.
So with respect to the pay adjustment proposal made by the Government this time around, after considering the net pay trend indicators for lower and middle level civil servants, only a slight reduction of less than 1% and under 2% were recorded and so a pay freeze was proposed. I think that this shows some sympathy for civil servants receiving a lower pay, this has precedents and can well be understood.
As for the rate of reduction in the salary of senior civil servants, which is as high as 5.38%, the level was determined in accordance with the pay trend survey mechanism, plus the six factors which the Chief Executive-in-Council had considered. Such a level of reduction is rather large and for those affected, it is true to say that the effect is quite devastating. But as I have said before, when dealing with public affairs, my concern is whether or not the Government has acted according to the mechanism, whether or not the procedures are fair and just and whether or not all the factors that need to be considered are considered according to the mechanism, and whether or not when a decision is made according to these factors, any deviation from common sense has appeared such that the conclusion so reached is not acceptable. In considering whether or not that the resumption of the Second Reading of this Bill should be supported, I have pondered over the question and I fail to see that there are any irregularities when all the above aspects are handled. Therefore, I think that action must be taken according to the mechanism and we must not reject it because it does not conform to our expectations.
During the discussions in this Council on legislating to effect a pay cut, the view that I have heard most of all is that a civil service pay cut will affect morale. With respect to this argument, I must say that I find it rather objectionable.
The financial tsunami dealt a serious blow to the territory at the end of last year and economic conditions were gloomy. Employees of private organizations were under great pressure as their income was reduced by various degrees and in various forms. It has been one year since that has happened. The situation in the private sector is reflected in the pay trend survey on this occasion and that is, there is a need for a pay cut. In the face of this economic decline, civil servants should tide over the difficult times with the public and they should not stand aloof. Compared with the employees of private organizations whose salary has already been slashed at the end of last year or at the beginning of this year, civil servants are very lucky. The idea of a so-called negative impact on morale is not just unacceptable to me but to many members of the public. We are not jealous of civil servants and it is not because we suffer and are under pressure that we want civil servants to experience the same hardship. It is because our consideration is that when dealing with public affairs, we must consider the relevant mechanism.
Earlier on, in the legislature, when we debated on other motions, some Members pointed out that the competitive edge which Hong Kong enjoys is the soft power. President, the soft power of Hong Kong lies in the fact that things are done according to the law and according to mechanisms and there is no deviation from such practice for reason of convenience's sake or yielding to any pressure.
On top of that, the civil service pay adjustment mechanism is advantageous to civil servants. All along, civil service pay increase has a retrospective period while any pay cut does not have any retrospective period and it can only be put into effect with endorsement from this Council in the form of a law enacted. The effect can be said to be quick in making increases and slow in making reductions. Even if the Council endorses a piece of legislation to reduce civil service pay, the effective date at the soonest is the first day of the first month after the passage of the Bill, that is, the first day of the following month. However, three months after that will be the time for the regular pay trend survey. If the net pay trend indicators turn out to be positive, civil servants may have their salary increased again after having a pay cut of three months, and the salary increase will take retrospective effect starting from next April.
As for views that the pay cut should be effected a long time ago if such a pay cut is needed and the time for the pay cut should not be left to this moment and there is no timeliness when a pay cut is to take place now because the economy of Hong Kong has turned better, so no reduction in salary should be made, the fact is that this Bill to effect a pay cut was introduced to this Council in June, but why should it be sitting idle until today, when we are to debate whether there is any need for a Second Reading? President, I think this is a question we must contemplate. I think that since Hong Kong is a place which cherishes the rule of law and where mechanisms and rules are respected, even if a pay cut is to last for two or three months, if this is what we think should be done, then we should go ahead and do it. We must respect the rules of the game that we have agreed on and we must not neglect principles and mechanisms for the sake of our convenience. For if not, what is the point of having mechanisms?
President, there are some groups that think that the Government should base its actions on the latest and most accurate data and rethink the pay adjustment proposal for senior civil servants. May I ask in return if, should this become a precedent, when the economy turns bad later, we shall allow the Government to consider the latest data at any time and readjust civil service pay in order to effect a pay cut in line with the latest economic conditions?
President, I would think that people who have joined the civil service are persons with commitment and they are sensible. It could well be the fact that many of them would agree that it is in line with the overall interest of Hong Kong to act according to principles and mechanisms.
President, I notice that earlier on, Dr Margaret NG pointed out in her speech that legislating to effect a pay cut was not the best option. The Government has promised that a review would be conducted and I think that the Government should take concrete steps to follow up and respond. Some Honourable colleagues have asked whether or not moneys could be entered into the account books as a freeze in pay instead of resorting to a pay reduction. There are also Honourable colleagues have suggested whether or not civil servants could be classified into four categories instead of three according to their remuneration. I think that all these can be considered. But before a review is complete and before any new mechanism is in place, we can only handle matters according to the existing mechanism.
President, I so submit in support of the resumption of the Second Reading of this Bill.
