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The following is the speech by the Chief Executive, Mr Tung Chee Hwa, at the Q & A Session of the Legislative Council today (Thursday):
Members,
We are now at the start of 1999. May I wish you all happy new year and good health. Before I take questions from members, I would like to go through a few issues that have been the major concerns of the public and the Council.
First of all, I would like to talk about the efficiency and performance of the civil service. In the past few months, members of the public and of this Council have expressed a lot of views on the efficiency of the civil service. Let me point out that, as a whole, we have a fine civil service, which is highly institutionalized. Our civil servants, who are well over 180,000, have won wide acclaim locally and from abroad for their dedication, integrity and efficiency. As a matter of fact, many of our departments have been working untiringly to provide quality and highly efficient service to the public.
During the historical reunification, the civil service continued to work with high efficiency and contributed greatly to our reunion with the motherland and to the successful implementation of the "one country, two system" principle. In the past 18 months, we were confronted with a spate of unexpected incidents, including the Asian financial crisis. In the face of adversity, the civil service is still able to stand against challenges with professionalism and maintain stability to ensure the smooth operation of the government.
There are criticisms in the community. It has been pointed out from the value-for-money point of view that there is still room for improvement in some departments. I share this same view. Indeed, all positive views, including the comments made by the Director of Audit in his Audit Report, are seriously taken by the government. We are always ready to correct the mistakes, if any. I have, in fact, urged the responsible departments to follow up closely the various views put forward to us in order to upgrade our service for the public and to enhance the efficiency of the civil service.
As I have pointed out in my Policy Address in last October, there is a need to increase the productivity gains in every department through the Enhanced Productivity Programme. The Programme has been carried out in an orderly manner. The heads of various departments are now working actively to achieve our targets of productivity enhancement.
A well established civil service should keep in pace with time. As Hong Kong is now faced with great financial difficulties, the government has the responsibility to set the way ahead for the people of Hong Kong, to lead the SAR out of adversity and to lay a firm foundation for the development of the SAR in the 21st century. One of the most important areas of our work is to improve the efficiency of the civil service. To ensure constant improvement in the efficiency of the civil service, we have to start with fundamental improvement in the system. To this end, I have urged the Civil Service Bureau to speed up its work and take hold of the opportunity to review the whole management system of the civil service and to carry out long-term measures for effective reform.
Measures for review and reform in the following broad areas have been taken into consideration:
(1) To review the permanent and pensionable terms of appointment of the civil service to see if the system will still be in line with the needs of Hong Kong in the 2lst century and to achieve better flexibility and higher cost-effectiveness in our policy for the appointment of civil servants;
(2) To conduct a comprehensive review of the salary and fringe benefits of the civil service to ensure that the salary and fringe benefits of the civil service will not be out of line with those offered in the private sector or in the market. The Standing Commission on Civil Service Salaries and Conditions of Service is now taking an important step forward by reviewing the starting salary of the civil service. On the basis of the results of the review, we will consider if a comprehensive survey on the salary and fringe benefits of the civil service is necessary. Our long-term objective is to study if the pegging of pay rise to performance being practised in the private sector is applicable to the civil service;
(3) To streamline further the disciplinary proceedings and to remind in particular the officers at the management level to attach importance to the strict enforcement of the disciplinary actions to ensure that an effective reward and punishment system is maintained in the civil service and to prevent the reputation of the dedicated civil service from being tarnished by a few black sheep; and
(4) To foster a management culture that is result-driven and customer-oriented. We will review the existing performance appraisal system, work out measures for improvement and study ways for strengthening professional training and individual development for officers at various ranks to enhance the vitality and openness of the civil service with the customers remain our focus.
The review and reform of the civil service are important tasks which will do much good to the SAR. In this connection, I have already given directives to the Secretary for Civil Service and requested that the review be carried out carefully and in great detail in order to achieve our objectives, but we must continue to adopt a fair and open attitude. I have also requested my Administration to consult fully the staff representatives and strengthen the communication between the management and staff sides. I will follow closely the progress of reform and work with the Chief Secretary for Administration and Financial Secretary in the monitoring of this important task.
I would also like to talk about the idea of a ministerial system. Recently, there have been calls from the community for the implementation of a ministerial system in order to solve the problems Hong Kong is now facing, including the enhancement of the efficiency of the government and the improvement of the relationship between the Executive and the Legislature. As I said not long ago, it is not the opportune time for taking this idea into consideration.
We have an efficiency-oriented and highly transparent executive body and a clean, law-abiding and effective civil service. In my view, it is most important for us at the present moment to consider how to consolidate and strengthen the structure of our Executive body, how to listen more to the voice of the public and how to respond actively to the views put forward by the public and the Legislators.
People have different views on the ministerial system. If such a ministerial system means the appointment of non-civil servant to serve in the government, our present system already allows this to be done. However, if it means a system of another form, I think the time is not yet ripe.
A ministerial system is not the only means for the improvement of the Executive-Legislative relationship, neither is it a panacea for solving all our problems. As the implementation of a ministerial system entails the reform of the entire constitutional system, we must give it an in-depth and careful thought. A blueprint has already been laid out in the Basic Laws for the political development of Hong Kong. We must follow the blueprint and allow the system to work for a period of time before we consider further if there is a need for major changes.
Lastly, let me talk about the economy. As a matter of fact, economy and unemployment remain the main concerns of the public. Two events related to these problems have taken place today, one of which has filled me with happiness while the other one has weighed me down with worry. I am happy to learn that the management and staff sides of the Cathay Pacific have worked together to strive for consensus on salary and work arrangements even under these pressing economic circumstances. I am, however, worried to learn of the economic crisis of Brazil which renders the external economic environment overcast once again with uncertainties.
I would like to point out that the opening up of the international markets in the past decades has indeed brought much benefits to Hong Kong and has created great wealth for the general public. Being an open economy, however, Hong Kong has to stand against many challenges under the present circumstances. We must understand that as for a small but open economy like Hong Kong, our enterprises have to compete not only with local enterprises but also with enterprises from all over the world. If our costs surge to too high a level, we will lose our edge over our competitors. The United States faced the same problem in late 1980s and early 1990s but it is now showing its advantages fully after adjustments have been made. As our competitors are the enterprises in Europe, America and Asia, we need to adjust our economy and our costs as well. The faster the adjustment goes, the sooner our economy will revive.
The fact that our economy in the past was overheated renders adjustment inevitable. The adjustment has already brought great pain to us. The property prices have plummeted, the unemployment population grows and wages are being adjusted. The adjustment is painful. Having to compete with other economies all over the world, we cannot but face the reality. The SAR Government will continue to strive for economy revival in the short and long terms. In the short term, we have already increased the expenditure in the 1998-99 financial year and reduced taxes to stimulate our economy. In the long term, we have also worked out objectives and strategies for future development, invested heavily on major infrastructural projects, increased expenditures on education, and encouraged innovation and technology to enhance our productivity and competitiveness, all for the sake of allowing Hong Kong to walk out from the bottom of the pitch as soon as possible. We have looked at all these measures from the angle of ensuring Hong Kong's long-term competitiveness.
I have mentioned in my Policy Address that there are four factors that exert influence on the economy of Hong Kong. Firstly, the interest rate must come down. Secondly, the property prices must remain stable. Thirdly, the external environment must be clear of uncertainties. Lastly, we must have confidence in ourselves. The interest rate has come down. The property prices have begun to stabilize. However, the external factors remain out of our control. The situation has changed somewhat for the better recently but the devaluation of Brazilian currency yesterday reminds us that the external factors are indeed not easy to predict.
All in all, the Hong Kong economy has bottomed out. Because of the need for adjustment, I think that our economy will remain at the bottom of the pitch for some time. In this relatively difficult period, the most important thing is for us to continue to strengthen ourselves and tide ourselves over the hard times together. Our destiny is in our own hands. The road ahead is up to us to form. We must have confidence in ourselves. As long as we have confidence in ourselves and move towards our targets, I believe that our economy will revive and we will become even stronger than what we were before when this trying period of economic adjustment is over.
Thank you.
End/Thursday, January 14, 1999
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