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Following is the speech (English translation) by the Secretary for the Civil Service, Miss Denise Yue, in moving the Public Officers Pay Adjustment Bill in the Legislative Council meeting today (July 8):
Acting President, I move the Second Reading of the Public Officers Pay Adjustment Bill.
In accordance with the established mechanism and having considered the six factors under the existing mechanism, the Chief Executive-in-Council decided on June 23, 2009 that civil service pay in 2009-10 should be adjusted as follows:
(i) a pay freeze for civil servants in the lower and middle salary bands; and
(ii) a pay cut of 5.38% for civil servants in the upper salary band and above subject to the proviso that no pay point in the upper salary band should be less than $48,700 (i.e. $300 above the upper limit of $48,400 of the middle salary band).
When making the above decision, the Chief Executive-in-Council has taken into account the following six factors:
(i) the net Pay Trend Indicators derived from the 2009 Pay Trend Survey;
(ii) changes in the cost of living;
(iii) the state of the Hong Kong economy;
(iv) the Government's fiscal position;
(v) the state of the civil service morale; and
(vi) the pay claims from the staff sides.
Based on our legal advice, in order to implement pay reduction with certainty and to forestall possible legal challenges, legislation is required to effect civil service pay reduction. Therefore, we need to enact the Public Officers Pay Adjustment Bill (the Bill) so as to implement the Chief Executive-in-Council's decision to reduce civil service pay in the upper salary band and above by 5.38%. This arrangement is in keeping with the arrangements in 2002 and 2003 when pay reductions were effected through legislation.
Acting President, the Bill will cover the pay and allowances of the following public officers:
(i) civil servants, including those serving in the Hospital Authority, who are remunerated within the upper salary band and above (i.e. with monthly pay above $48,400);
(ii) officers in the Independent Commission Against Corruption (ICAC) whose monthly pay is above $48,400. This is in keeping with the established practice of adjusting the pay of ICAC officers strictly in accordance with the pay adjustments to civil servants at comparable levels;
(iii) the Director of Audit, whose pay is determined by the Chief Executive under section 4A of the Audit Ordinance (Cap. 122) by order published in the Gazette;
(iv) public officers whose monthly pay is above $48,400 and is determined on the basis of civil service pay, and/or linked to civil service pay adjustment, other than those mentioned in (i) to (iii) above; and
(v) allowances which are linked to civil service pay adjustment.
The Bill is not applicable to:
(i) judges and other judicial officers whose pay adjustment follows a mechanism that is independent of and separate from that of the civil service;
(ii) political appointees, whose pay is delinked from that of the civil service. In this connection, as the Chief Executive has announced, political appointees will voluntarily reduce their pay by 5.38% with effect from July 1;
(iii) non-civil service contract staff in the Government whose employment package is separate and different from that of the civil service;
(iv) staff in the subvented sector who are employed by individual organisation on its own terms and conditions, and whose employment is governed by the Employment Ordinance (Cap. 57). We consider that pay adjustment for these employees should be made in accordance with the terms of their contracts and the relevant provisions under the Employment Ordinance;
(v) public officers whose pay is not determined on the basis of civil service pay and/or linked to civil service pay adjustment; and
(vi) allowances which bear no relationship with pay adjustments to the civil service, e.g.housing allowances, education allowances, leave passage allowance, etc.
According to the Bill, the pay reduction will take effect from the first date of the month immediately following the month during which the Bill commences.
Acting President, I would like to take this opportunity to explain why it is necessary to put in place the proviso that no pay point in the upper salary band should be less than $48,700.
Since the Chief Executive-in-Council has decided to freeze the pay for civil servants in the middle salary band, this means those at the top pay point of this salary band will continue to receive a monthly pay of $48,400 in the Master Pay Scale, while a reduction of 5.38% for civil servants at the upper salary band will mean those at the bottom pay point of this salary band will receive a monthly pay of $47,760 in the Master Pay Scale. In short, a civil servant at a higher pay point will receive a lower monthly pay than one at the immediately lower pay point. The same anomaly will also occur in the Police Pay Scale and the General Disciplined Services (Officer) Pay Scale. Such a pay scale design would be illogical and most undesirable from a staff management point of view. The proviso that no pay point in the upper salary band should be less than $48,700 (i.e. a pay 'lead' of $300 above the upper limit of the middle salary band) will overcome this problem. It will also enable the continued operation of the current demarcation of the three salary bands for the conduct of future annual pay trend surveys.
Acting President, this year's civil service pay adjustment decisions were made in accordance with the established mechanism and having regard to the relevant factors under the established mechanism. Therefore, I appeal to Members for their support of the Bill.
Acting President, I so submit, thank you.
Ends/Wednesday, July 8, 2009
Issued at HKT 15:59
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