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Governor: Well, I've commented on it the other day. And my reply today is going to be remarkably similar to the reply I gave the other day. And I'll give it if you let me. The reply is this that I haven't yet heard from the President of the Legislative Council about the dates of sittings of the Legislative Council next year. The constitutional position, now that I am no longer the President of the Legislative Council, is that I specify the date at which the Legislative Council will begin, the date on which I am going to make my Policy Address and I've already given -- that is the second of October this year. I then when I've heard from the President of the Legislative Council accept when the Legislative Council will close down for the summer. But I'll do that again this year. But none of that affects the fact that the British Government, the Hong Kong Government, and the overwhelming majority of people in Hong Kong think that the Legislative Council that was elected freely and fairly by a record number of people in September last year should continue to go through to 1999.
Question: And the civil service pay rise rate has been endorsed by the Executive Council.
Governor: It has indeed.
Question: And it is the lowest rate for the past ten years. Some of the civil service associations are afraid that it will destroy the morale of the civil servants during the transitional period. So how do you respond to their discontent?
Governor: Well, the percentage pay rise is lower because inflation has been falling. The actual rate of inflation today is half, less than half what it was in the year before I arrived in Hong Kong. I am delighted that Financial Secretary has helped to keep Hong Kong so competitive by edging inflation down though I still believe that it is too high. We have a formula for setting civil service pay and it's a fair formula. We have pay trend indicators which reflect what's happening in the private sector and I think there is a broad agreement in the community that is the fairest and most acceptable way of dealing with civil service pay. Now we follow that trend survey, and if we depart from it this year, what's going to happen in other years, conceivable years when the figures aren't as helpful. There is one other thing that we follow, and that is that we regularly raise the lower band percentage up to the middle band level when the lower band was lower. We've done that again this year at a cost as I recall of seven to eighty million dollars, at eighty million dollars. That's fair to the lower paid. But I don't think it would be right to overthrow the pay trend indicators because it would destroy at a sensitive time, the basis for fair civil service pay settlements. We all know that we have an outstanding civil service in Hong Kong. I think that we respond to that by ensuring that we have adequate investment in civil service training and that we give civil servants decent remuneration. The key indicators when you're looking at remuneration are whether what you are paying people motivates them, whether it recruits them, whether it retains them. And I think we can honestly say that the overall pay that we provide our civil servants in Hong Kong achieve those three objectives. Thank you very much.
End