Our Ref. : BP 6/25
13 March 2007
Development of an Improved Civil Service Pay Adjustment Mechanism – Improvements to the Annual Pay Trend Survey Methodology
I write to let you know that a Pay Trend Survey (PTS), covering the period from 2 April 2006 to 1 April 2007, will be conducted very shortly under an improved methodology.
The improved methodology to be followed represents the outcome of months of extensive consultation with staff sides representatives. Its implementation will enhance the credibility of the PTS mechanism. It is supported by the staff side representatives and the Standing Commission on Civil Service Salaries and Conditions of Service. It has been endorsed by the Chief Executive-in-Council on 13 March 2007.
The two main elements encompassed in the improved methodology are: (i) the broadening of the survey field to include both large (employing 100 or more staff) and smaller (employing 50-99 staff) private sector companies; and (ii) the modification of the data consolidation methodology to complement the broadening of the survey field. More detailed information on the improved PTS methodology is set out in the relevant Legislative Council Brief, which is available through the Internet at www.csb.gov.hk.
I have already invited the Pay Survey and Research Unit of the Joint Secretariat for Advisory Bodies on Civil Service and Judicial Salaries and Conditions of Service to conduct, as a matter of urgency, the forthcoming PTS. The Pay Trend Survey Committee, on which the staff sides of the four central consultative councils are represented, has also been re-convened to oversee the conduct of the PTS.
The improved PTS methodology is an important component of the improved civil service pay adjustment mechanism. Another important component is the conduct of pay level surveys (PLS) on a regular and periodic basis to ascertain whether civil service pay is broadly comparable with private sector pay. With the assistance of a consultant, we have recently completed a PLS using 1 April 2006 as the reference date. We are now discussing with the staff side representatives on how the PLS results should be applied to the civil service having regard to the relevant policy considerations, including the inherent differences between the civil service and the private sector.
We hope to conclude the discussions in the coming weeks, following which we will consult the three advisory bodies on civil service pay and conditions of service. We will then seek the advice of the Chief Executive-in-Council on whether and (if so) how civil service pay scales should be adjusted with effect from 1 April 2006 (which is the reference date of the PLS). We wish to reiterate that the adjustments, if any, will not cause a serving civil servant's salary to be reduced to below the level prevailing on 30 June 1997.
The civil service pay scales on 1 April 2006, as and when decided, will serve as the basis for any pay adjustment in 2007-08. In line with existing policy, the pay adjustment (if any) for 2007-08 will be determined by the Chief Executive-in-Council having regard to the outcome of the PTS to be conducted shortly and other relevant considerations such as the state of the economy, changes in the cost of living, the Government's fiscal position, staff sides' pay claims and staff morale. The financial implications (if any) of the decision will be submitted to the Finance Committee of the Legislative Council for approval.
I will write to you again when a decision has been made on the application of the PLS results. Thank you for your attention.
(Miss Denise YUE)
Secretary for the Civil Service