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Executive Chief Executive Carrie Lam Chief Secretary Matthew Cheung Financial Secretary Paul Chan Secretary for Justice Teresa Cheng Executive Council Convenor: Bernard Chan Bureaus, departments and etc. Hong Kong Civil Service
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The Hong Kong Civil Service is managed by 13 policy bureaux in the Government Secretariat, and 67 departments and agencies, mostly staffed by civil servants. The Secretary for the Civil Service (SCS) is one of the Principal Officials appointed under the Accountability System and a Member of the Executive Council. He heads the Civil Service Bureau (CSB) of the Government Secretariat and is responsible to the Chief Executive (CE) for civil service policies as well as the overall management and development of the civil service. His primary role is to ensure that the civil service serves the best interests of the community and delivers various services in a trustworthy, efficient and cost effective manner. The CSB assumes overall policy responsibility for the management of the civil service, including such matters as appointment, pay and conditions of service, staff management, manpower planning, training, and discipline.

Appointment

Appointments to the civil service are based on open and fair competition. Candidates have to go through competitive appointment processes and are appointed only if they possess the qualifications and capabilities required for the job. Vacancies can be filled by promotion from within the service. In the case of basic ranks or where promotion is not possible or where there is a special need, vacancies are filled by open recruitment. To achieve the target of reducing the civil service establishment, the Government implemented a general recruitment freeze to the civil service with effect from April 1, 2003, with exemption granted only on very exceptional circumstances. Entry requirements for civil service posts in general are set on the basis of academic or professional qualifications obtainable from local institutions or professional bodies (or equivalent), technical skills, work experience, language proficiency and other qualities and attributes as required. To achieve the aim of a civil service which is biliterate (Chinese and English) and trilingual (generally conversant in spoken Cantonese, English and Mandarin), language proficiency in Chinese and English is also required. From January 2003 onwards, for civil service posts requiring degree or professional qualifications, applicants should pass the two language papers (Use of Chinese and Use of English) in the Common Recruitment Examination before job application. For civil service posts with general academic qualifications set below degree level, applicants should attain at least Grade E in Chinese and English (Syllabus B) in the Hong Kong Certificate of Education Examination, or equivalent. In accordance with the Basic Law, new recruits appointed on or after July 1, 1997 must be permanent residents of the Hong Kong Special Administrative Region, save for certain specified exceptions.^[1]

Promotion

Officers are promoted on the criteria of character, ability, experience and prescribed qualifications. All eligible officers are considered on an equal basis. The officer selected for promotion must be the most meritorious one who is able and ready to perform duties at a higher rank.

Public Service Commission

The commission is an independent statutory body responsible for advising the CE on civil service appointment, promotion and disciplinary matters. In practice, the advice is rendered to the SCS and the CSB deals with the commission on individual cases. The chairman and members of the commission are appointed by the CE. The commission seeks to ensure the impartiality and fairness in appointments to the civil service and also advises on discipline matters. In accordance with the Public Service Commission Ordinance, advice of the commission has to be sought for appointment or promotion of officers to middle and senior ranking posts (excluding the disciplined ranks of the Hong Kong Police Force). The commission is also consulted on changes in appointment procedures applicable to civil service posts.

Independent Advisory Bodies on Pay and Conditions of Service^[2]

Three independent bodies advise the Government on matters relating to pay and conditions of service. Their members are selected from outside the Government.

• The Standing Committee on Directorate Salaries and Conditions of Service advises on matters affecting the directorate.


• The Standing Commission on Civil Service Salaries and Conditions of Service advises on the principles and practices governing the pay and conditions of service of all non-directorate staff except those in the judicial and disciplined services.


• The Standing Committee on Disciplined Services Salaries and Conditions of Service advises on the pay and conditions of service of all disciplined services staff except the heads of the services who remain under the purview of the Standing Committee on Directorate Salaries and Conditions of Services.


• The Standing Commission on Judicial Salaries and Conditions of Services advises on the structure, and matters relating to the system, institutional structure, methodology and mechanism for the determination of judicial salary.

Key Pay Principles of Civil Service

The objective of civil service pay is to offer sufficient remuneration to attract, retain, and motivate staff of suitable calibre to provide quality service to the public.^[3] Both civil servants and the general public should view the pay for civil service fair. Broad Comparability with the private sector is important when considering the pay for the civil servants.  This pay principle was sourced from the recommendations of the Royal Commission on the Civil Service in 1953.^[4] In 1965, the Commission further suggested that the principle of fair comparison should be weighted the most among all other considerations, including internal relatives, which is being emphasised too much in the past, commented by the Task Force on the HKSAR Civil Service Pay System.^[4]

Training and development

The main objectives of training and development are to equip civil servants with updated knowledge and skills, and to develop their potential so that they can continue to improve their performance and provide quality service to the public. Training and development programmes are carefully designed to enhance performance and to support the core values of the civil service. Job-related training is arranged by departments while induction and grade specific management training for general grade members are in general provided by respective grade management. Full-time and part-time courses are provided, either locally or overseas, for staff to obtain the requisite knowledge. The CSB provides robust training and development support to departments through its Civil Service Training and Development Institute. There are four core service areas: senior executive development, national studies programmes, human resources management consultancy service and promotion of a continuous learning culture. Senior executive development programmes include leadership development and national studies programmes for directorate and potential directorate officers. Advisory services on Human Resources Development (HRD) and succession planning are also provided. National studies programmes include courses at Mainland institutes like the National School of Administration, Foreign Affairs University, Tsinghua University and Peking University. There are also local programmes on national affairs and the Basic Law, as well as staff exchange programme with the Mainland. To promote a continuous learning culture, an e-learning portal, the Cyber Learning Centre Plus has been launched. The comprehensive suite of learning resources and training information in there help staff learn at their own pace. The Institute also disseminates best practices in HRD through its advisory services in training needs analysis, learning strategies, development of competency profiles, and performance management systems, etc.^[5]

Performance management

Through the performance appraisal process, staff at different levels are made aware of the standard of performance expected of them. Proper management of the process helps maximise individual performance and enhance the corporate efficiency and effectiveness of the civil service as a whole. As an integral part of the overall human resource management functions, it is a major tool in human resource planning (e.g. succession planning), development (e.g. training and job rotation), and management (e.g. confirmation, promotion, posting and disciplinary action). Performance appraisal of staff is an ongoing process. While appraisal reports would normally be completed annually, regular communication between managers and staff on performance is essential. Transparency and objectivity of the appraisal process are also emphasised. To improve the system, department management is encouraged to put in place assessment panels to undertake levelling and moderating work among appraisal reports, identify under-performers/outstanding performers for appropriate action, adopt other management tools including target-based assessment and core competencies assessment, and ensure supervisors do an honest, objective and timely assessment of their subordinates. The performance management system ensures good performance and exemplary service are rewarded and given due recognition, whilst under-performers are managed, counselled and offered assistance to bring their performance up to requirement. For persistent substandard performers who fail to improve, action will be taken to retire them in the public interest. In recognition of long and meritorious services, there are the Long and Meritorious Service Travel Award Scheme, the Long and Meritorious Service Award Scheme and the Retirement Souvenir Scheme. A commendation system also exists to give recognition to exemplary performance.

Staff discipline

Disciplinary action is taken against an act of misconduct to achieve a punitive, rehabilitative and deterrent effect. All disciplinary actions are handled promptly and in accordance with established procedures and the principles of natural justice to help enhance management credibility and staff morale.

Staff relations

There is both a central and a departmental staff consultative machinery. Centrally, there are the Senior Civil Service Council, the Model Scale 1 Staff Consultative Council, the Police Force Council, and the Disciplined Services Consultative Council. Through these channels, the Government consults its staff on any major changes, which affect their conditions of service. At the departmental level, there are Departmental Consultative Committees which aim to improve co-operation and understanding between management and staff through regular exchanges of views. There are established channels to deal with staff grievances and complaints. Individual members of staff with problems can receive counselling, advice and help. A Staff Suggestions Scheme is run by both the CSB and departments to encourage staff to make suggestions for improving the efficiency of the civil service. Awards are given to those whose suggestions are found useful. A Staff Welfare Fund caters for the interests of staff. A Staff Relief Fund provides assistance to meet unforeseen financial needs to staff.^[6]

Background for Civil Service Reform

Civil Service Reform has started since 1999 and a series of measures are placed by the Hong Kong Government, including the introduction of Principal Officials Accountability System in 2002.

Reasons to reform

Despite the dedication and professionalism of the Civil Service, the public have not been satisfied with the handling of a number of specific incidents by the Government. There are also criticisms that the efficiency of certain department has to be improved.^[3]

Furthermore, against the backdrop of approaching the 21st Century and the fast-paced changing external environment, the Civil Service had to undergo a reform to keep pace with the community, improve itself and enhance its efficiency.^[3]

Principles^[3]

1. Change admidst stability for maintaining smooth operation of the Civil Service.


2. Step by Step. Due to the scope of the reform, gradual approach must be taken. For example, setting priorities, formulating detailed proposals for reform, and implementing the proposals step by step. Relatively straight-forward proposals are tackled first.


3. Comprehensive overview. Proposals have due regard to all aspects of the Civil Service system and align with the overall reform framework.


4. Wide Consultation with an open mind, as the implications of the reform is wide and far-reaching.


5. Practicable measure. The proposals of the reform must be practicable.


6. Reasonable and lawful. The reform should be reasonable, consistent with the Basic Law.
   

Objectives^[3]

The major objective of the reform was to put forward proposals to restructure the administration of the Civil Service so as to make it more flexible and prepare to face the changes and increasingly demanding challenges in the years ahead and meet the demands of society. Specifically, the reform aims to lead to an open, flexible equitable and structured civil service framework; an enabling and motivating environment for civil servants; and a proactive, accountable and responsible culture.

Scope

In 1999, Tung Chee-wah,  then Chief Executive of the HKSAR, announced that the reform will be conducted in 4 policy areas: Entry and Exit Mechanism, Pay and Conditions, Conduct and Discipline, and Performance Management, Training and Development.^[3]

Civil Service Reform: Entry and Exit Mechanism

Drawbacks of the previous entry and exit practice

The following drawbacks are identified in the civil service system which are the focus of reform for entry and exit system.

First, youngsters are not fond of committing to a life-long career soon after graduation. They would like to seek different opportunities in the fast-changing economic environment rather than opt for a stable career.^[3]

Second, lacking flexibility in the current entry and exit arrangement in the civil service system has blocked the talented from entering the hierarchical system, especially for high-rank positions.^[3]

Third, the current security of tenure is not motivating for civil servants to boost their efficiency and productivity when they have been working in the civil service for a long time. Thus, the reform focuses on enhancing managerial flexibility and obtaining better value for money.^[3]

Reform on entry system

Redefining “permanent terms”

“Permanent terms” under civil service reform are no longer meaning full security of tenure and pensionable system, rather it means a structured and long-term employment for good performers.^[3]

Short-term contracts at basic ranks

Newly entered to the civil service, their permanent and pensionable terms are replaced by a fixed-term contract terms. Their performances, aptitude, and working habit will be reviewed regularly. If their performance is satisfactory and meet criteria of requirement, they will be considered for permanent contract, appointing into supervisory ranks.^[3] For those whose performance does not meet the expectations and did not demonstrate abilities to take up managerial tasks are required to have their agreements terminated.

This increases flexibility of hiring and better screening out unsuitable candidates even after they are employed. True abilities and aptitudes and work habits can be revealed through long time working in the bureau and performances are subjected to review on a regular basis by supervisors which greatly reduces adverse selection problem. Thus, information asymmetry will be greatly reduced as supervisors can obtain sufficient information to determine permanent appointment. It creates flexibility for departments to align appointment arrangements to suit their managerial needs.^[7] Besides, it helps boosting performances of employees as they might lose the job if performance does not meet the standard. It ultimately creates greater flexibility for civil service on manpower control such that they can recruit new bloods each year.^[3]

In practice, before 1 June 2000, newly recruited employees are granted 2-year contract term upon satisfactory performance and conduct.^[8] For some of the basic ranks civil servants (e.g. Administrative Officers), they are subjected to longer probation period with regard to special management or advanced operational considerations.^[9]

From 1 June 2000 onwards, the probation period extended to 6 years, consisting of 3-year contract terms and 3-year agreement terms (i.e. the “3+3” system). Under such mechanism, newly recruited civil servants are subjected to 3-year probation period, than a 3-year observation period.^[10] The government aims to creates higher flexibility for recruitment and address the problem of adverse selection.

In 2010, the Legislative Council Panel on Public Service issued a proposal on changing the “3+3” system as they found that the second 3-year observation period is unnecessary that over 99%of the under-performed are discovered during the first 3-year contract term.^[8] In the latest terms of appointment of civil servants, it is stated that the probationary term would be 3 years. Upon the end of the probation period, they will be considered for appointment on the prevailing permanent terms.^[11]

Opening up promotional and supervisory ranks’ recruitment

The civil service is opening up promotional and supervisory ranks for talents from outside the civil service systems and experiences civil servants who have left the service to join the system when deemed necessary and appropriate.^[12] Fixed-term agreement is still applicable for this recruitment, normally appointed on agreement terms of 3 years.^[9] Only those matches the expected terms will be granted permanent terms.

Variations to recruitments of individual grades or cases

Individual grades or individual cases can also be opened up for public recruitment, with the approval of the Civil Service Bureau. It subjects to modification to suit operational needs on top of the advice of the Public Service Commission.^[8]

Expanding the scope of assessments on civil servants candidates

Since 1 September 2008, most qualified applicants for most grades are required to sit for the Basic Law Test.^[13]

Also, all applicants are required to pass the Common Recruitment Exam (CRE) that accesses Chinese and English language, and aptitudes.^[13] Candidates for Administrative Officers, Executive Officers, Labour Officers, and Trade Officers are required to take the Joint Recruitment Exam (JRE) testing on their potentials and relevant skills and attributes.^[14]

Reform on exit system

Replacing pensionable system with provident fund (MPF)

Starting from 1 June 2000, pensionable system were replaced by a provident fund. Newly recruited civil servants were adhered to MPF system under the new terms of appointment and conditions of service.^[15] Also, a new fringe benefits were introduced to incentify newly entered civil servants, it includes revised earning rates, new leave passage arrangement, and non-accountable housing benefits.^[16]

Voluntary Retirement Schemes (VR)

The voluntary retirement Scheme was carried out twice. The scheme is entirely voluntary in nature that no pre-determined positions were identified for force retirement.^[3] Upon voluntary retirement, civil servants were able to receive pension benefits and extra compensation at around HKD$2 million, subjected to different grades.^[17] It aims to reorganize the civil service by deleting the posts once civil servants left. The government can then allocate more resources and money to enhance efficiency in other areas. By reducing redundant manpower in the civil service, it can also achieve cost saving for government’s spending in the long run.^[17]

The first Voluntary Scheme took place in July 2000. 59 designated grades were identified or anticipated with staff surplus. As a result, 9774 civil servants were approved to retire under the scheme. There are 250 applicants who were failed to leave as the government proved that there is an operational need for continuing the posts. Another 50 applications were still pending for disciplinary proceedings.

^[18]The second Voluntary Retirement Scheme took place in March 2003. Civil servants under 229 designated grades were identified or anticipated with staff surplus.^[17] As a result, 5290 left with regard to the scheme.^[15]

Though the scheme achieved cost effectiveness. As shown in the review of the first Voluntary Retirement Scheme, HKD$751million was saved on the annual salaries given on repeated positions^[18], however, some departments have raised issues of departure of experienced staff and time period to fill out replacements of general grades staff^[18]. The scheme has a tendency of loss of capable and talented staffs in voluntary schemes.

Management-Initiated Retirement Scheme

Unlike the voluntary retirement scheme, management-initiated Retirement Scheme aims to reduce the number of under-performers at the directorate rank, so that more injections of new blood can be performed subsequently. Heads of department are delegated power to terminate under-performers so as to strengthen human resource management to deter shrinking, so as to maintain the quality of management at the senior to facilitate improvement in the government organization.^[19]

The scheme was initiated since September 2000 to provide for the retirement of directorate civil servants on permanent and pension system.^[15] Until 2004, 13 were retired under the scheme. ^[20]In the review report issued in 2004, the government stated that reviewing of the retirement package is necessary to reduce government’s fiscal deficit.

Civil Service Reform: Pay and Conditions

Development of reform of cutting starting salaries

1998-1999

Many of the private sector has cut salaries and jobs due to the Asian Financial crisis. The private sector condemned that the public sector has overstaffed and overpaid civil servants; and the civil servants are having too much, including high pay, generous fringe benefits and job security. The civil servants are not facing the same problems as the private sector, which is not fair to the taxpayers, especially under the financial crisis.^[21]

1999

The government conducted a review on starting salaries in response to the public opinion.^[13] According to the pay level survey, the starting salary of the public sector is found to be higher than that of the private sector for as much as 31%.^[22] The starting salaries are then cut by one to six pay points, up to 31%^[13]. Take the starting salary for an administrative officer as an example. It fell from HKD 35,285 to HKD 28,075 per month, which is around 20%^[13]. The new starting salaries began on civil servants that hired in or after September 1999 and is not applicable to civil servants that are in the civil service before September 1999.^[13]

2010

The monthly starting salaries are further cut by $2,000.

Development of reform of cutting salary levels

2000

In March after the review on starting salaries, the business sector in the Legislative Council Panel on Public Service demanded the government to move the pay review beyond the entry level. ^[4]They asked the government to choose one or two market grades with their counterparts in the private sector for comparison before reviewing other grades.^[4] At that time, some non-business members in the panel rejected and argued that it is not reasonable to expect public sector can follow private sector pay changes closely since the private sector can react at once to the economic situation.^[4] They also claimed that was not a suitable time for such review.^[23]

2002

In March, the Financial Secretary predicted that civil service pay needed to be cut by 4.75%^[4] for financial planning purpose in his Budget Speech, when the result of pay trend survey has not yet been finalised.

The private sector, like the pro-business Liberal Party, and the Hong Kong General Chamber of Commerce, conducted and published their pay level surveys, which reached a similar conclusion that there was still a huge salary gap between the private and public sector. The annual cash pay for the public sector was around 17%, and even 40% higher if benefits were included, more than that in private sector.^[24] For example, junior government clerks with form 4 education were being paid 46% more than that of their counterparts in the private sector; government experts in computer operation were overpaid by 38%; university graduates in administrative posts in the government earn about HKD 6,000 more per month, compare to the private sector. ^[25]The Chamber argued that civil servants are gaining much more than just ‘job security’^[24]. Hence, the private sector demand for a more in-depth reform on civil service pay.

2002

In response to the public criticism and the prevailing economic downturn, the government push forward a legislation to allow cuts of civil service to avoid legal violation of Basic Law, which stated that civil servants’ pay, allowances, benefits and conditions of service shall be ‘no less favourable than before’.^[26]

2003

The Public Officers Pay Adjustment Bill was passed in July 2003.^[4] The Secretary of the Civil Service Joseph Wong Wing-ping announced that the civil servant unions agreed to the government request on freezing pay in 2003 and cut salaries by 3% in 2004 and 3% more, back to pre-1997 levels in 2005^[27], which is being named as the “3+3 option”. The business groups are still not satisfied with the amount of reduction and the slow implementation. It is considered to be a delaying strategy in keeping the overall objective of maintaining high civil service while responding to the public.^[13]

2010

The government cut 5.38% of the civil servants with a monthly salary over HKD 48,000.

Reform- Pay determination system

There are mainly 2 types of surveys in the pay review mechanism, namely Pay Trend Survey and Pay Level Survey. They are conducted for making sure the adjustment in pay for the civil service follows that of the private sector. ^[3]

Pay Trend Survey- mainly examines the private sector salary trends

The survey includes all full time employees of around 90 companies in Hong Kong who work 75% or more of the normal weekly working hours and whose basic salaries are equivalent to that of the civil servants.^[4] The government figures out the increase or decrease of pay level of the private sector every year. Year-end bonuses and tenure of the employee are also included into the survey.^[4]

Limitations of Pay Trend Survey

The time lag due to the survey process

The changes in salary based on the pay trend surveys are usually not in line with the real economic situation and the actual inflation rate. As it takes time for the data collected to be analysed.^[13] For example, the salary of civil servants increases in 1984-1985, 1988-1989 and 1991-1992 despite of the economic downturn.^[28] The delay can be up to 12 months.^[13] It is criticised that the pay trend surveys are being used as a tool for a political game as there were times when the government awarded less than the survey results, i.e. in 1975, 1983, 1991 and 2001.^[13]

Lack of representativeness

The survey has depended on data from ‘large and reputable’ firms, but not the small and medium-sized companies where majority of people are working in Hong Kong.^[29] In the 2001-2002 survey, more than 50% of participating companies has over 500 employees and 23% of them employed more than 1500 employees.^[30] It is criticized to be biased toward utility companies due to the unwillingness of participation in the survey of many companies.^[31]

Also, it has not considered the chances that some firms, like PCCW, may have paid more to improve productivity after downsizing and restructuring the operation.^[31] This could lead to the unreasonable comparison between the pay level of the public and private sector.

Weak interpretation and the sole prerogative of the government

The criteria for translating the survey indicators into changes in pay to the civil servants, its priority and measurement of impact of adjustment are not clear and changing. This provides room for civil service unions with to manoeuvre.^[13]  The 5 stated considerations are state of the economy, budgetary considerations, cost of living, staff side pay claims and impact on staff morale.^[32] However, the government introduced the criteria of views of the community and business sector sometimes and stated that the every change is based on separated considerations under different circumstances at the particular time.^[13]

Only on the private sector

The pay trend survey does not include the evaluation of correctness of civil service pay. The pay changes diverts public attention from the more important correctness issue to which such changes are applied.^[4]

Pay Level Survey- examines and compares the salary trends of the public and private sector

It uses the factor-point method, which compares the representative samples of civil service jobs with a closely representative sample of jobs in the private sector based on 3 criteria-^[33]

1. Know-how, i.e. the qualifications, knowledge, skills, and experience required to enable the job to be carried out properly;


2. Problem-solving, i.e. the original thinking required by the job for analyzing, evaluating, creating. Reasoning, arriving at and making decisions; and


3. Accountability, i.e. the answerability for decisions/ actions and for the consequences thereof.

The total scores for each job will then be calculated and matched with the salary and the total remuneration of the job. Fringe benefits are being categorised into the maximum notional value to employees.^[4]

Limitations of Pay Level Survey

The absence of pay level survey

This more comprehensive survey, compared to the pay trend survey, has not been conducted since 1986.^[13]

Defects in methodology

The results of the 1986 survey was being objected by the Staff unions, like the Senior Civil Service Council and the Police Force Council. The argued that defects were found in the method of job evaluation and the valuation of fringe benefits in the survey. ^[4]A Committee of Inquiry was then appointed in response to the evaluation of the pay level survey in 1988. They concluded that the methodology used for evaluation of fringe benefits overvalued civil service benefits in relation to housing. They suggested that^[4]

1. Job-for-job comparison would have been more preferable and created more confidence


2. The survey should be conducted at three-year intervals

Development of reform of Pay Trend Survey and Pay Level Survey

2001

Some critics argued that the 2001 Pay Trend Survey did not accurately reflect the pay changes in the private sector. The salary levels presented exceed the real figures, especially for the lower salary band.^[4]There were calls for a comprehensive review on the methodology of the Pay Trend Survey and the adjustment mechanism for civil service pay.^[4] The Secretary for the Civil Service also stated that the salary levels beyond the entry ranks in the civil service for over 10 years. Therefore, they pay for some grades in the civil services is not comparable to the pay levels in the private sector in the pay adjustment mechanism.^[4]

2002-2003

In face with a rising budgetary deficit, i.e. 5.5% of GDP and with personnel emoluments accounting for a substantial portion of government expenditure, the government has no choice but to announce its decision to conduct a pay level survey before the end of 2004.^[4] The Civil Service Bureau appointed a consultant (Phase One Consultant) in November 2003 to provide technical assistance in developing a feasible and credible survey methodology.^[34]

2004-2005

The Civil Service Bureau issued a consultation paper for extensive consultation, containing the proposals on the Pay Level Survey methodology as recommended by the Phase One Consultant and the CSB's proposals on the general approach for applying the survey results.^[35] Phase Two Consultant was appointed  in June 2005 to carry out the fieldwork of the PLS in accordance with the methodology developed under the Phase One Consultancy.^[35]

2006

First modified pay level survey was conducted. It is then conducted every 6 years.^[35]

2007

On 13 March 2007, the Executive Council endorsed an improved methodology for pay trend survey, under which smaller companies with 50-99 employees are included and a modified weighted average approach i.e. a gross-up factor of around 25% is applied to small firms, was adopted to ensure large firms are not dominating the result.^[36]

—Reform-- Experiment with performance-based pay

The civil service pay scale is not based on performance, but the individual grade or vacancy of the department. ^[3]This does not provide an incentive for the civil servants to perform better. Research has proved that receiving both material and nonmaterial rewards is the major motivation for civil servants to perform well.^[37] While the private sector has adopted the performance-based pay system widely, there is clearly a gap between the private and public sector that is needed to be changed according to the key principle of civil service.

In 2001-2002, the Civil Service Bureau started a pilot performance-based pay scheme in 6 government departments.^[13] However, performance-based pay was not further developed since then. The Secretary of Civil Service Joseph Wong Wing-ping commented that it is due to the culture of the civil service that rewards performance by promotion.^[38] It is also stated that the performance appraisal system by relying on surveys of their internal and external customers are weak. ^[13]The Police Force Council also commented that performance-based and variable pay for different units may lead to favouritism, corruption and elitism.^[39]

Reform-- Cutting and monetizing fringe benefits

The private sector in Hong Kong is moving towards a ‘total remuneration’ concept, streamlining and encashing while there is still a gap between that of the public sector.^[3]

On 1 June 2000, the government introduced a new fringe benefits package.^[40] The Finance Committee of the Legislative Council has approved the final package of change proposals at its meeting on 19 May 2006. All change measures have been fully implemented in 2007-08.^[41] Examples of the changes:^[40]

1. Reduced education allowances, including overseas and local education allowance


2. Subsume travelling expenses in the place of study under School Passage Allowance


3. Freeze the allowance rate for travelling expenses


4. Abolish the air-conditioning and hotel subsistence allowance


5. Adjust the rate of Accommodation Allowance according to the territory-wide rental movements, instead of just selected districts in the past

Pension is being replaced by provident fund. For civil servants on probation and agreement terms, they are provided with mandatory provident fund while those with permanent terms would be eligible for benefits under the Civil Service Provident Fund Scheme.^[42]

Civil Service Reform: Conduct and Discipline

Maintaining a high level of integrity in the Civil Service is essential in face of the challenges in future, public expectations and demands. To review the rules and regulations on conduct and discipline and to assist departments to strengthen departmental procedures and guidelines to help staff avoid potential conflict of interest, the government set up a task force jointly with Independent Commission Against Corruption (ICAC) to develop and launch a “Civil Service Integrity Programme”.^[3]

The disciplinary mechanism and procedures aim to punish misconduct and to maintain deterrent effect. They were revamped to ensure that disciplinary cases are processed promptly, equitably and impartially due to ineffectiveness of the former mechanism.^[3]

Disciplinary Mechanism

Former mechanism (Before 2000)

Disciplinary cases were processed by officers in departments or the Civil Service Bureau, and many of them may not be specialised in handling disciplinary matters. The merit of this mechanism was the centralisation of expertise and experience, so that disciplinary cases were processed in a prompt, impartial and equitable manner.^[3]

Current mechanism (Since 2000)

The current mechanism was implemented since 17 April 2000. An independent standing secretariat to process disciplinary cases for all civil servant was set up under the Public Service (Administration) Order. The secretariat is staffed by a team of officers with experience in disciplinary proceedings. It is headed by a Senior Principal Executive Officer and 10 Executive Grade officers with experience in disciplinary matters, which serve as  adjudicating panel members responsible for hearing individual disciplinary cases and determining whether the officer is guilty of misconduct.  This results in a greater speed and efficiency in the processing of cases and more consistency in deciding on the level of punishment.^[3]

The roles and functions of the Secretariat include:^[43]

1. advising departments in preliminary investigation and collation of evidence of specific acts of alleged misconduct;


2. presenting evidence and witnesses at inquiry hearings;


3. providing logistical support to the inquiry officers/committees at inquiry hearings;


4. acting as a resource centre on precedent disciplinary cases for consideration by the disciplinary authority on punishments;


5. liaising with departments and disciplinary authority on matters relating to the standards, procedures and practices of disciplinary actions; and helping departments identify areas vulnerable to misconduct and to find ways to improve their staff management systems.

Discipline Procedures

Former Discipline Procedures (Before 2000)

The authority for and conduct of the former disciplinary proceedings was governed by the Public Service (Administrative) Order 1997 and the Public Service (Disciplinary) Regulation as made under the Order. The Public Service (Administrative) Order 1997 were straight adaptations from the previous Colonial Regulations. The Public Service Commission provided independent advice on disciplinary cases and the levels of punishment. While the appeal against the decision is handled by the same Commission.^[3]

Current Discipline Procedures (After 2000)

Streamline in disciplinary procedures is introduced in 2000. Meanwhile, this also aims to put in place an efficient and effective disciplinary mechanism in the Civil Service to punish misconduct and to maintain deterrent effect, while complying with the principles of natural justice.^[3] The differences with the former discipline procedures include dispensing with the invitation of representations from the accused officer before inquiry hearings, using video-tapes and audio-tapes to record inquiry proceedings, and reducing the period for invoking summary dismissal action from 21 to 14 days.^[3]

Civil Service Reform: Performance Management, Training and Development

Performance Management

Drawbacks of the current system

The individual-based performance management systems in practice has resulted in over-generously graded their subordinates.^[3] 90% of civil servants are rated in the top three grades of a six-grade global performance appraisal scale (i.e. outstanding, very impressive, or very effective).^[13]

In implementing the reform, result-oriented management culture shall be continued to promote throughout the whole civil service system.^[3] However, the result in practice has addressed weakly on performance management system.^[13]

Reform-- Linking increments to performance

Rules on awarding with increment was issued and reinforced in the Civil Service Regulations. It regulates that increment granting must be based on civil servant’s performance (including conduct, diligence and efficiency).^[3] If their performance is satisfactory, they will be granted an increment. If civil servants performed sub-standardly, the Civil Service Regulations also regulates that a stoppage and deferment of increment shall be enacted.

The power of reviewing civil servants’ performance has been delegated to the Heads of Department or Heads of Grades. Guidelines have been issued to Heads to assist in the review.

Reform-- Improving on performance appraisal

The government’s Performance Appraisal Principles are as follows:^[13]

1. Heads of Department/ Heads of Grade can decide on their own appraisal system within the framework of these principles


2. Performance appraisal shall be regarded as a multi-purpose management tool. Outcomes from staff appraisal should guide other human resource management functions


3. Performance appraisal is the joint responsibility of the individual and the supervisor


4. Performance appraisal is a continuous and ongoing process


5. Checks and balances should be built into the system to ensure fairness and objectivity


6. Outstanding performance at one rank does not necessarily indicate suitability for promotion to a higher rank.

Since public services are not evaluated in the free market, performance criteria is difficult to be generated and be compatible with the private sectors. Thus, the government identified a set of core competencies for each rank and grade. Core competencies includes leadership, communications, personal effectiveness, analysis and judgement, staff management, resource management, and knowledge.^[13]

The appraisal will be carried out by immediate supervisors with input from relevant high-level managers. In the reporting cycle, both appraisees and appraisers should be informed of the main objectives or responsibilities during the reporting period. Changes should be reviewed if necessary. By the end of the cycle, the appraiser should complete the assessment and turn it in to relevant higher-level manager for further evaluation. This act is to ensure that the evaluation is done in a fair and consistent manner. Discussion shall be held between appraisers or higher-level managers and appraisee and the summary of discussion shall be recorded on the appraisal form. After that, the appraisal shall be passed for “fitness for promotion” when the appraisal is completed.^[13]

Appraisees can appeal to their respective Head of Department or Head of Grades.

To address the problem of over-generous rating, in 1999, the Civil Service Bureau suggested “reform of the performance appraisal culture and standardization of grading is also necessary”.^[3] Authorities recommended “indicative benchmarking” or “forced choice” on grading.^[44]

Since late 1998, the engineering grade has implemented “forced choice” method. A list of rules have been imposed for grading at each rank. For instance, there shall be no more than 10% of appraisees in each rank of “outstanding”; around 45% of them should be rated as “very effective”, 35% as “effective”, followed of 1-10% as “moderate”. As for “poor” and “very poor“ ranks, evaluations should be reserved for exceptional or very exceptional cases respectively. All divisions shall follow the guidelines except a small number of officers in the Principal Government Engineer and Government Engineer rank would subject to a certain degree of flexibility.^[13]

The Housing Department also implemented “forced choice” method since 1996. The guideline states that there should be no more than 10% of appraisees in each rank and grade rated as “outstanding”. However, due to difficulty in removing informal rules of rating based on seniority and basing promotion on the results of appraisals inside the department, it has resulted in most senior staff in the Housing Department were being graded as “outstanding”. The Department believes that the purpose of appraisal report is for promotion with seniority, but not based on the performance in daily routine work.^[13] Misunderstanding and misconception of the appraisal system under the reform of performance-based management indicated a failure in this case.

In the end, due to pressurizing from some staff unions, the government decided not to adopt to the whole civil service system.

Reform-- Establishing a system of assessment panels

A system of assessment panel shall also be established to ensure fairness and consistency throughout the appraisal report. The panel shall be formed by senior members of the department.^[3] The functions of the panel are to monitor the distribution of grading. By moderating appraisal reports, the panel shall identify staffs with substandard performances and outstanding performances. Appropriate actions shall be given to punish or reward respective staff members. Besides, the panel is also responsible for handling appeals when necessary.^[3]

In practice, many departments have adopted assessment panels. By January 2000, 20 departments have established assessment panels which includes 156 ranks in 62 grades.^[45]

However, there are still controversies on whether the assessment panel is effective and fair to judge appraisal reports and handle appeals. Controversies sparked at the Labour department, Fire Services, and the Customs and Excise Department. Departments pointed out that the panel fails to consider perspectives of other stakeholders other than supervisors (e.g. co-workers).

Training and Development

Limitations of training programs

When the Legislative Council Select Committee was investigating the public housing problem, it is found out that the Housing Department was not able to make sure their staff were appropriately trained, causing wastage in public resource.^[13] The site staff recruited by consultants of the Department for projects had not received any government in-house training, adequate induction on the site environment and information before they supervise the site work.^[46] There is no proper hand-over of duties and frequent changes of site staff during projects, which result in the degradation of services provided.^[47]

Also, there is critics for lacking of training policy co-ordination within government and between government and service providers. The evaluation of training is conducted at a limited level. More fundamentally, government departments may not realize that their staff need training. Take the handling of Yu Man-hon case in 2001 as an example, the Ombudsman has pointed out that immigration officers ‘lacked the knowledge, skill, awareness, and alertness” to handle undocumented people.^[13]

Reform details^[13]

1. Wider use of tailor-made training plans to address identified training needs from regular review, bridge competency gaps, prepare civil servants to take up further responsibilities in the higher echelon and to encourage civil servants to enrich their knowledge for the dynamic environment


2. Wider scope of issues are taught in the training and development activities, for example national affairs, leadership training, formulating public policies, modern management, language studies, information technology, professional work skills, etc.


3. More methods are incorporated in carrying out training, including classroom training, multimedia training, self-learning, on-the-job development, exchange within public sector and with private sector, and experience sharing sessions, etc.

Participation of staff unions in the Civil Service Pay reform^[13]

April 1999

Lobbying: Representatives of civil service unions appeared at the Legislative Council to protest against civil service reform measures

May 1999

Rally/demonstration: 10,000 civil servants protested against the civil service reform on 23 May while 20,000 of them from 109 staff unions marched to demonstrate their disagreement on the reform on 30 May.

July 2000

Petition: The unions handed in a petition with 40,000 signatures of civil servants to the Chief Secretary demanding job security and disagreeing civil service reform

Rally/ demonstration: 9 July, 10,000 civil servants, including all disciplined services, except the Police Force protested against civil service reform.

June 2002

Walkout/boycott: 10 union leaders walk out of the meeting with Chief Secretary to protest against pay cuts.

July 2002

Rally/Demonstration: 35,000 workers from the public sector demonstrated against cutting of salaries.

October 2002

Court action: With the support of the Local Inspectors’ Association, Police Inspector sued the government over pay cuts.

Walkout/boycott: 5 unions, including the Police Local Inspectors’ Association boycotted consultative sessions and liaison activities on pay cuts organised by the Civil Service Bureau from May to October.  

May 2003

Court action: Government Park and Playground Keepers’ union took the government to court on her pay cut in 2002.

See also

• Civil service of the United Kingdom


• Civil Service Bureau


• Government of Hong Kong


• Hong Kong Civil Service cruise perk

References

External links

• 
  Civil Service Bureau official website (in English) (in Chinese)