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CE's transcript at Joint Chambers of Commerce Luncheon
(English only)
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Following is the transcript of a question-and-answer session by the Chief Executive, Mr Donald Tsang, at the Joint Chambers of Commerce Luncheon at the Hong Kong Convention and Exhibition Centre today (October 17) (English only):

Question: The questions are going to be about harbour planning. There are two issues that I'm really concerned about. The number one issue is that the community as a whole agrees with you on the need for a cruise terminal, new government offices, LegCo offices, cultural venues and public parks around our harbour. But the fact that we only have 600 hectares left, are you confident that we are, under the current plans, putting all these developments in the right place? The last question, again, given the fact that we only have 600 hectares of land left around our harbour, and we have all agreed that we are no longer going to reclaim, is it right to put the OZPs that have been developed in the eighties into effect, or should we review them and reduce the intensity of the developments around our harbour or should we leave the problem for the new roads required to our children?

Chief Executive: These issues can be debated continuously. But the important thing is that once we have debated these issues and decided on a course of action then we must do something about it. And not continue to engage in arguments, particularly when a town plan has been made after a long process of consultation we have more or less set on what we are going to do, at least in Central and the harbour areas. I agree with you that there are very few pieces left. But the plans are being very rigorously prepared and I do believe we have a reasonable plan. But unless you have very good reasons for overturning them and if you want to then there are avenues for doing so, through the town planning process. But otherwise we have to be careful every time we turn around and say we want to have a look at it again, and another look at it again and before too long you see land has been lying idle, doing nothing for 10 years. The piece of land outside in West Kowloon for cultural district was left idle without doing anything on it for 11 years. The piece of land at Tamar having been used for carparking, occasional circuses and now temporary exhibition centre and fairs for quite a number of years, is right in the heart of our city. I think let's consider carefully that when we have a plan let's work at it. Be very careful not to upset too many things, particularly if you're going to have very tall buildings, let's be very careful about the design. If you're going to upset the ridge and if you can't see the ridge of the mountains and so on, let's be careful to avoid that also. But let's do it sensibly. This is the mood of the city. There seems to be a very strong anti-development course at the moment. This is the very time when development is needed. I think a balance must be struck somewhere, but I agree with you the whole harbour area is being looked at and every sub-project that we are not undertaking along harbour-side is being debated and I am sure the right decisions are being taken.

Question: I want to thank you sincerely for attaching importance to social harmony including racial harmony. I also want to thank you for emphasising that any kind of discrimination, including racial discrimination, is not allowed. Hong Kong SAR Government particularly has accepted in 2001 that there is a need to introduce legislation to prohibit any act of racial discrimination. Now it is four years and the bill is still not passed. Can I ask you the reason for the delay?

Chief Executive: This has been quite a controversial issue in the past. All I am saying is, we are now putting a piece of legislation in LegCo in the current session. I want to say in this session, in my term it will be there. We have to work out carefully the terms, particular wording and so on. I have said in my Policy Address this will be put across and we are going to do so. We intend to introduce something in the Legislative Council in the current sittings.

Question: Many years ago when I was a little boy living in London, London suffered dreadful air pollution - a problem we see daily, unfortunately, here in Hong Kong. Now, London's air pollution problem was solved by the introduction, within a fairly short time, of strict laws against it, strictly enforced. Would you please tell us what you are going to do about this continual problem of air pollution in Hong Kong?

Chief Executive: We introduced strict laws in Hong Kong. We are enforcing strict laws in Hong Kong. We are even looking at the fundamental issue of power generation and forcing power plants to comply with very high standards. Unfortunately that is not enough because the air here that we inherit travels without boundaries - it just flows from one place to another. The question is how we will be able to co-operate with our Guangdong partners in this regard. I addressed this issue in great detail in the Policy Address. We have got a plan. By 2010 we have got to reduce the emission level to a certain fixed level, and some of them by 60% and some by 40% and so on each of these emissions. I think that's a good plan that will bring us back to the air quality of the eighties and early nineties. But the important thing is how that will be enforced. For that reason, we have detection centres to monitor the emission from different parts of the Pearl River Delta. There are three to be established in Hong Kong and 13 on the Mainland, in the Pearl River Delta. This coming winter we are going to give real-time, day-to-day reports on the emission level and pollution level in each of these 16 monitoring centres. That will give the population of Hong Kong and Guangdong information on how bad or good it is or whether it is improving or deteriorating. I believe this will generate enormous pressure on the Government here and the Governments on the Mainland to take corrective action as soon as the information is available. We have a good plan and we are processing it but this whole thing takes a bit of time and the origin of some of the emissions is not necessarily all in Hong Kong. We have done quite a bit, as you know, about changing our taxi fleet into LPG and we are tackling the power plants. As far as Hong Kong is concerned I think we have done what we can as an advanced economy, but we have to do a bit more as far as air is concerned on the Mainland and that is through the co-operation strategy which I have just outlined and said quite clearly in the Policy Address.

Convener: Maybe you should also sign up with the chamber's clean air charter.

Chief Executive: That's another thing. I am very happy about that. That's a voluntary scheme, a very important scheme because I believe the bulk of the manufacturing capability in the Pearl River Delta is owned by people around this community, in this very room. The less you guys emit in your factories the cleaner the air, not only in the Pearl River Delta but here as well.

Question: Corporate governance has been something that the business community has had to contend with, particularly in the last two years, and has responded very well. Governance, in your words, is one of your platforms. Could we ask can we have a more responsive civil service and what are your plans for improving governance within the largest employer that provides a service to all of us seeking to keep Hong Kong progressive and a leader in world trade?

Chief Executive: That's a very general question. Is the implication that the quality of the civil service here is deteriorating compared with civil service elsewhere? You have to be more specific. Tell me where exactly you believe the service is deteriorating.

Question: Let me be specific and ask about your plans for public sector reform. When can we see a more simplified salary structure that enables civil servants, perhaps to be paid better for better performance? Can we see a more fluid civil service that provides more rapid responses in some cases than we are receiving? Is that better?

Chief Executive: That is not necessarily going to create better services for you. Let me tell you this - if you want to introduce a new salary structure for the civil service like the one you envisage, you must expect about three or four years of total argument within the civil service and perhaps chaos for a while. I'm not saying that's not a good thing. The important thing is that it's nothing to do with quality of service received. What is important here is whether you are getting the service for the sort of money you are paying out for. I know there's a notion of incentive pay system but that seems to work a lot better in the private sector than in the public sector. We can try, but I cannot promise you on this. Certainly in my term I want to see more public sector/private sector participation in government projects. But a wholesale change in salary structure is outside my scope in the next 20 months because I do not believe that in the short run it can produce better service for the public, and that is more important from my point of view. You are looking from a purely theoretic and management point of view whether an organisation can become better by shaping structure, by making it more salary oriented. That in fact has not been universally applied in other advanced economies as well and is at a very primitive stage if I may say so. But I certainly welcome your idea, how it can be implemented, but just remember, let's focus on what we need best. We want procedures to be more streamlined, we want services more prompt, we want civil servants to be more civil, we want them to work diligently, efficiently. That's important. And how much we pay them, that's the salary bill that we do. But we are generally a very small public sector, comprising hopefully less than 20% of the GDP, but at the same time, as far as structure is concerned, this is a long-haul thing. I want to see a convincing case that we need to embark on it, at least in my term. And I haven't seen one yet.

Question: Thank you very much for your comments about the civil service. I think everyone in this room recognises it's the best civil service in Asia. It's expensive. For about 60 years we have been talking about how to broaden the tax base, but that wasn't mentioned in the Policy Address, and I wonder if we are going to talk another 60 years on how we are going to pay for the wonderful services that we have available in Hong Kong.

Chief Executive: Well, we have been paying for it up to now and so far we have been able to make both ends meet. I have not forgotten broadening the tax base. You must remember who raised that subject in the first place. One Financial Secretary raised it and it was Donald Tsang, if you remember. In fact he started a task force to look at that very issue. The fact that it was not mentioned in the Policy Address because it is not a matter for the Policy Address as such. It's a matter for the Financial Secretary's Budget speech. There must be a division of labour here. That is not forgotten, we continue to purse it. The important thing is how exactly to implement it. I'm sure Henry Tang is going to say a lot more about this in his coming Budget speech early next year. I can tell you work on it goes on.

Question: Two underlying themes in your Policy Address - strong leadership and consulting and engaging the community. I just wonder how you reconcile the two. If I can give you an example - on the West Kowloon development, 75% of those consulted said they prefer to see a cultural policy in place before the scheme went ahead. Yet, you've gone ahead, you're moving on, so isn't leadership dominating over community views?

Chief Executive: You have forgotten, we have already got a cultural policy. Those guys who say we don't have a cultural policy have not read all the papers. A cultural policy was in place for two years, two and a half years. It is under that system that we have developed the West Kowloon district. It was developed by the Home Affairs Bureau. It is published, it is on the Net, it is all in the open. Unfortunately, when people talk about cultural policies, they don't want the cultural policy we have, they want the cultural policy that suits them, that pushes the sectoral needs. This is a circuitous question. All the questions raised about cultural policy, we already have one. As far as they want the district to be developed not by a single developer we've got a strategy which meets that point explained by the Chief Secretary a couple of weeks ago. They wanted public participation and management of cultural centres and a scheme was devised and was announced a couple of weeks ago and we are discussing the detail of it. But as far as the question of cultural policy, I'm afraid you have not got things right. We have got a cultural policy.

Ends/Monday, October 17, 2005
Issued at HKT 20:15

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