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only marginal hope for an early change in the situation. We talk frequently about the serious effects of

emigration, in the full knowledge that it will not abate. And Government refuses, wrongly I believe, the selective importation of foreign labour on fears of the social

And the Administration is still not keen

consequences.

on a more widespread interchange of personnel between government and the private sector to create more

9 flexibility, such as I have repeatedly recommended.

10 Instead of showing irritation at the rising, but perhaps

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not surprising, inclination of civil servants to consider

12 filling the many vacancies in the local commercial

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arena, Government should make a virtue out of the necessity to attract local expertise into the Civil Service, at least for temporary stints. This may also 16 help to overcome the increasing incidence of government 17 by consultancy which we are now witnessing and which is 18 also quite expensive. Hong Kong clearly has become too 19 big and too sophisticated to be run along the lines of 20 the gifted amateurism which has traditionally been the hallmark of British colonial governments, But I would like to query why practically all major policy decisions now have to be preceded by outside consultancy studies. 24 With a tendency to return administrative functions to

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the private or quang sector even in China, we shall 26 see this sort of interchange more readily there as well

in the years to come. And particularly with a view towards localisation, why should we fight in Hong Kong what has become a formula for success in many other 30 countries? Potential conflict of interest is mentioned

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but is a weak excuse, especially since it is only applied 32 one way or for the selected few.

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34 Sir, if I now move from more general to · more specific 35 observations, I may be forgiven for again mentioning the 36 problem of the US, Tax Reform Act 1986 for Hong Kong-based

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