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Speech by SLW at the LegCo Special Finance Committee Meeting (Labour)

     Following is the English translation of the speech by the Secretary for Labour and Welfare, Mr Matthew Cheung Kin-chung, at the Special Meeting of the Finance Committee (Labour) in the Legislative Council today (March 26):

Chairman and Honourable Members,

     Recurrent spending on labour and manpower development in 2009-10 will reach $1,200 million, representing an increase of $48 million  over the Revised Estimate last year.  It accounts for 0.5% of the Government's recurrent expenditure.  In 2009-10, our priority is to strengthen employment services as well as promote the efficiency of the employment market and facilitate the dissemination of vacancy information, thereby helping job seekers enter or re-enter the labour market.  We all know that labour relations is relatively tense lately. We will strive to promote labour relations and combat illegal employment and wage offences.  In addition, we aim to introduce the Minimum Wage Bill into the Legislative Council (LegCo) in this legislative session.  We will continue to improve occupational safety and health and strengthen training and retraining services.

Promoting Employment

     As a result of the economic slowdown and uncertain economic outlook, the latest unemployment rate has increased to 5%.  In the first two months of this year, the Labour Department (LD) posted 81 176 private sector vacancies, representing a decrease of 19% over the corresponding period in 2008.  In the face of slackened labour market amidst the financial tsunami, the Government will do its best to help the affected employees and job seekers.

     In his Budget this year, the Financial Secretary has announced that LD would enhance and integrate its various employment programmes in 2009-10, including the Youth Pre-employment Training Programme, the Youth Work Experience and Training Scheme, the Employment Programme for the Middle-aged and the Work Orientation and Placement Scheme to strengthen the training and employment support for the vulnerable groups of youth, the middle-aged and people with disabilities.  Some 44 000 training and employment opportunities will be provided.

     We will provide additional manpower to LD・s 12 Job Centres to monitor closely redundancy and closure exercises and reach out to the retrenched employees proactively.  We will also disseminate vacancy and employment information, offer referral services, and promote labour rights. LD will organise more job fairs at shopping centres and community halls, and more routine, small job fairs at the Job Centres.

     We will launch an Internship Programme to provide about 4 000 places (3 000 in local enterprises and 1 000 in Mainland enterprises) for university graduates to work as interns and receive training for six to 12 months. The objectives are to broaden the horizon of the graduates and help them gain experience, as well as to nurture talent for the industrial and business sectors.

Promoting Labour Relations

     In 2008, the number of labour disputes and claims handled by LD dropped by 5% as compared to that in 2007.  This is the lowest level since 1998. However, with the onset of the financial tsunami in September 2008, the number of labour disputes handled by LD from October 2008 to February 2009 increased sharply by 57%. It is worth nothing that the settlement rate of labour disputes and claims handled by LD stood at 72.7% - the highest level since 1994. We shall continue to monitor closely and try our best to tackle possible labour dispute from the onset.

     We will also continue with our promotional work in enhancing harmonious labour relations, especially through the promotion of the Employment Ordinance and the work of the industry-based tripartite committees.

Protecting Employee・s Rights and Benefits

     To protect the employment opportunities of local workers, the Government takes rigorous enforcement action against illegal employment.  In 2008, together with the Police and the Immigration Department, LD mounted 186 joint operations.

     We have also spared no efforts to combat wage offences. We have focused on the prosecution of employers and responsible persons involved, thus, securing a total of 958 convictions against wage offences.

     The Protection of Wages on Insolvency Fund (PWIF) received a total of 6 448 applications in 2008, an increase of 33% over the figure in 2007.  For January and February 2009, PWIF received a total of 1 703 applications, an increase of 126% over the figure of 755 in January and February 2008.  Over the last few months, LD has developed new arrangements whereby LD would facilitate the submission of preliminary applications to PWIF the very moment bankrupt employers or Provisional Liquidators announce the decision to wind-up the companies.  

     Besides, we are deeply concerned about the failure of some employers to effect payment to their employees as awarded by Labour Tribunal.  We aim to introduce a bill into LegCo in the 2008-09 legislative session.

     Furthermore, in 2008 to strengthen protection for our workforce, amendments were made to the Pneumoconiosis (Compensation) Ordinance to extend its coverage to cancerous mesothelioma.

     This year, we plan to improve the statutory benefits for persons with occupational deafness under the Occupational Deafness (Compensation) Ordinance.  Under the proposal, employees suffering from monaural hearing loss will also be entitled to compensation.  The maximum reimbursable amount for the expenses incurred in purchasing, repairing and replacing hearing assistive devices will be increased. Employees who have already received compensation under the Ordinance will be entitled to further compensation in respect of additional hearing loss sustained as a result of continued employment in noisy occupations.

Statutory Minimum Wage

     Some sectors of the community, the business sector in particular, have wondered if now is the right time for the introduction of the Statutory Minimum Wage (SMW) Bill. There is no cause for alarm. We all know that it takes time for the SMW to be implemented and that the Government・s stance on the issue is very clear. The SMW is a policy objective worth pursuing in order to safeguard the interests of the vulnerable and enhancing social harmony. Yet, we are also mindful that we should maintain Hong Kong・s competitiveness and business environment as a whole. We shall, therefore, handle the issue very carefully.

     The Provisional Minimum Wage Commission (the Commission) was established on February 27, 2009 to advise the Government on the initial SMW rate based on an evidence-based approach. In the process, the Commission will ensure a sensible balance between forestalling excessively low wages, minimising the loss of low-paid jobs while sustaining Hong Kong・s economic growth and competitiveness.

     The Census and Statistics Department will conduct a large scale survey in the second quarter of this year to collect wage data from 10 000 enterprises and 60 000 employees. The Commission will then make the recommendation after the data are analysed at the end of this year or early next year. If everything goes smoothly, the SMW will be implemented by the end of next year at the earliest, quite a while from now. Let's not worry too much.

Enhancing Occupational Safety and Health

     Although safety and health at work in Hong Kong has improved continuously, there is no room for complacency. We are concerned that minor works projects and maintenance works would bring even more hazards.

     In view of the impending commencement of major infrastructure projects by the Government to create jobs, we will continue to promote safety and health at work through enforcement, publicity and education.

Training and Retraining Services

     The Employees Retraining Board (ERB) will continue to provide more training opportunities. The ERB will provide at least 123 000 training places in 2009-10 and has reserved resources for providing an additional 20 000 training places in anticipation of an increasing training demand.  We will closely monitor the changes in the labour market and adjust the allocation of training places flexibly to meet the coming challenges.

     Chairman, this concludes my opening remarks.  My colleagues and I shall be happy to respond to questions from Members.

Ends/Thursday, March 26, 2009
Issued at HKT 20:53


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