I have explained to the Legislative Council that there is an established mechanism and timetable for civil service pay adjustment.  It is based on objective market pay trend indicators and takes into account other factors including the state of the economy, the cost of living, budgetary considerations, the Staff Sides' pay claims and the morale of the Civil Service.  To introduce any arbitrary and out-of-cycle pay adjustment for political reasons would be a departure from the established practice.  It would cause major controversy within the Civil Service.  It would also have adverse repercussions in the private sector and labour market.

The Chief Secretary for Administration (CS) expounded the above concern in his address to the Legislative Council this Wednesday.  "Indeed, we should be more concerned that the civil service pay system would become subjected to political whims," he said.  "This kind of development would undermine the stability of the service and the much vaunted principle of political neutrality."

Under the existing mechanism, pay adjustments in the private sector this year will be reflected in the pay trend survey next year, producing either positive or negative pay trend indicators.  In either case, the Administration will follow the established practice of taking into careful consideration all relevant factors before deciding on the direction and extent of civil service pay adjustment.  The Legislative Council, the general public and fellow colleagues will be able to draw a lawful, fair and reasonable conclusion from objective data and the prevailing social and economic realities.

In the recent public discussion on civil service pay, there were concerns that the Administration had not reviewed the pay levels of the Civil Service for over a decade.  Since our pay adjustment mechanism bases itself on three broad salary bands, the comparability of civil service pay with private sector pay for some grades and ranks may have been eroded over time.  As a responsible government, we need to address these concerns.  In fact, we revised the starting salaries for all entry ranks in the light of market changes last year.  In some ranks, this led to reductions of up to about 30 per cent in the starting point salary.

However, as the CS has pointed out, the most germane issue is whether our current policy and system for civil service pay meet today's circumstances.  He has pledged that the Administration would, as a matter of priority, address the public concerns in this regard.  This is a highly complex task and we need to approach it with care.  As the CS has stressed, we will not overlook the fact that a stable and motivated civil service is a cornerstone in the stability and prosperity of Hong Kong.

I can assure you that we will not proceed in haste.  We will consult the Staff Sides before making a final decision on the way forward.  As I said in my first letter to you, for every policy or recommendation, full account will be taken of the interests of colleagues and the keen expectations of the public.  We will ensure that the Civil Service continues to offer an attractive and worthwhile career for people with a mission to serve the community.

Let me repeat : we do not agree to a civil service pay adjustment which is not based on the established mechanism.  However, we agree to look into the existing pay policy and system.  This position demonstrates clearly that on the one hand, the Administration has a responsibility to ensure that civil servants receive fair and reasonable treatment without being subjected to political influence; and on the other hand, we are duty-bound to ensure that the civil service system, including the mechanism for determining and adjusting pay levels, will continue to be accepted and supported by the public.

Being a civil service of the people and for the people, we have an obligation to look into concerns expressed by members of the public and to address them in an impartial manner.  I firmly believe that the public would appreciate the need for a stable, clean and highly efficient civil service in the context of future discussions on civil service pay.

 Yours sincerely,

(Joseph W P Wong)
Secretary for the Civil Service