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LCQ4: Post-service employment arrangements for senior staff of the Hong Kong Monetary Authority

     Following is a question by the Hon Mrs Regina Ip and a reply by the Financial Secretary, Mr John C Tsang, in the Legislative Council today (November 17):


     To ensure that the post-service employment of former directorate civil servants will not lead to conflict of interests with their previous government service, the Government has put in place stringent arrangements and vetting and approving procedures for post-service employment. For example, the control periods and sanitisation periods for civil servants at Directorate Pay Scale Point 4 (or equivalent) are two years and twelve months respectively. However, there have been comments that post-service employment arrangements for senior staff of the Hong Kong Monetary Authority (HKMA) are much less stringent. For example, a former Deputy Chief Executive and a former Executive Director of HKMA who left employment in May 2005 and January 2006 respectively had taken up senior positions in local banks within the same year, and the former Chief Executive became a non-executive director in three listed companies within a year after his leaving employment in October 2009. There have been comments that HKMA being the central bank, the manager of the Exchange Fund of Hong Kong and an important institution monitoring the banking system of Hong Kong, major conflict of interests will arise if its senior staff members are allowed to join banks or financial institutions shortly after their leaving employment. In this connection, will the Government inform this Council:

(a) of the post-service employment arrangements for the Chief Executive, Deputy Chief Executives and Executive Directors of HKMA, including the control periods and sanitisation periods, as well as the restrictions and vetting and approving mechanism for taking up full-time remunerated work or work of a commercial nature;

(b) given that it was mentioned in the Annual Report 2009 of HKMA that "HKMA is an integral part of the Hong Kong Government", why the post-service employment arrangements for its senior management staff are less stringent than those for civil servants at Directorate Pay Scale Point 4; and

(c) whether it has plans to review the existing arrangements and vetting and approving procedures for post-service employment for senior staff of HKMA, so as to strengthen public recognition of the integrity and honesty of its team members, as well as to more effectively prevent conflict of interests?



     My reply to the three-part question is as follows:

(1) The Hong Kong Monetary Authority (HKMA) staff exit management arrangement consists of two parts: a notice period and a control period.

     The standard period of notice of termination is six months for staff at the Executive Director level and above. The HKMA makes full use of the notice period as necessary to ensure that the departing employee is separated from sensitive duties or duties that might have conflict of interest with any future employment.

     The control period for the incumbent Chief Executive of the HKMA is 12 months from the termination of his employment with the HKMA. The control period for officers at the Deputy Chief Executive and Executive Director levels is six months. These officers must obtain prior approval before he or she may:

(a) enter business on his or her own account;
(b) become a partner of a partnership;
(c) become a director of a company; or
(d) become an employee, whether or not on a full-time basis

in Hong Kong during the control period.

(2) The HKMA and the civil service employ staff on different terms. A direct comparison between the two would not be appropriate.

(3) The Governance Sub-Committee of the Exchange Fund Advisory Committee will, taking into account the actual circumstances, keep under review the need to re-examine the post-termination employment policies and procedures and submit recommendations to me.

Ends/Wednesday, November 17, 2010
Issued at HKT 12:41


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