XN000022-1994-01-12 — Page 26

WEDNESDAY, JANUARY 12, 1994

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IT IS OF COURSE TRUE THAT THE 1968 AGREEMENT BETWEEN THE GOVERNMENT AND THE THREE MAIN STAFF ASSOCIATIONS OF THE SENIOR CIVIL SERVICE COUNCIL PROVIDES FOR THE APPOINTMENT OF A COMMITTEE OF INQUIRY, TO DETERMINE MATTERS ON WHICH AGREEMENT CANNOT BE REACHED AFTER FULL AND PROPER DISCUSSION.

THE PROVISION, HOWEVER, SPECIFICALLY EXCLUDES, AMONG OTHER THINGS, MATTERS OF SETTLED PUBLIC POLICY. SINCE THE ANNUAL PAY ADJUSTMENTS HAVE BEEN DETERMINED ENTIRELY IN ACCORDANCE WITH THE ESTABLISHED AND SETTLED POLICY, IT FOLLOWS THAT THEY CANNOT BE SUBJECT TO REVIEW BY A COMMITTER OF INQUIRY UNDER THE TERMS OF THE 1968 AGREEMENT. TO IGNORE THIS LOGIC WOULD BE WRONG IN PRINCIPLE AND SET A DANGEROUS PRECEDENT FOR THE FUTURE.

THE "SHORTFALL"

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LET ME NOW TURN TO THE QUESTION OF THE ALLEGED "SHORTFALL" NUMBER OF MEMBERS SUGGESTED THAT THE GOVERNMENT HAS MADE UP SUCH SHORTFALLS" IN THE PAST. THIS, I MUST SAY, IS A MATTER OF INTERPRETATION.

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I HAVE SAID, THE BASIC PREMISE IS THAT EACH PAY ADJUSTMENT INDEPENDENT. ANY DEVIATION FROM THE PAY TREND INDICATORS IN ANY YEAR IS JUSTIFIED ON THE CIRCUMSTANCES AT THE TIME. THE STAFF ASSOCIATIONS, IN MAKING THEIR PAY CLAIMS, MIGHT HAVE TAKEN INTO ACCOUNT SO-CALLED "SHORTFALLS" IN PREVIOUS YEARS, BUT WHETHER THE GOVERNMENT WAS ABLE TO MEET THEIR REQUESTS WAS A DECISION BASED ON THE PREVAILING CIRCUMSTANCES AT THE TIME.

FOR EXAMPLE, IN BOTH 1992 AND 1993, SALARY ADJUSTMENTS FOR THE MORE JUNIOR STAFF EXCEEDED THE CORRESPONDING PAY TREND INDICATORS. THIS DECISION REFLECTED OUR CONCERN FOR THE IMPACT OF INFLATION ON THE LOWER INCOME GROUPS AND ILLUSTRATES MY EARLIER POINT ABOUT USING THE PAY TREND INDICATORS AS A POINT OF REFERENCE ONLY.

IT IS IMPORTANT TO REALISE THAT EXISTING POLICY PROVIDES FOR THE FLEXIBILITY TO DEVIATE FROM THE PAY TREND INDICATORS, WHERE APPROPRIATE. AS A PRUDENT GUARDIAN OF THE PUBLIC PURSE, THE GOVERNMENT MUST MAINTAIN THIS FLEXIBILITY. I DO NOT THINK THERE CAN BE A GOVERNMENT IN THE WORLD WHICH WOULD ALLOW ITSELF TO BE COMPLETELY DICTATED ΤΟ IN AN ENTIRELY MECHANICAL WAY BY TRENDS IN THE PRIVATE SECTOR IN DETERMINING THE PAY FOR ITS EMPLOYEES.

IN THE FINAL ANALYSIS, THE KEY QUESTION IS WHETHER CIVIL SERVANTS HAVE BEEN TREATED FAIRLY. LET ME POINT OUT THAT OVER THE PAST DECADE, CIVIL SERVICE SALARIES HAVE INCREASED, ON AVERAGE, ABOUT 180%, OR 30% IN REAL TERMS. THIS COMPARES FAVOURABLY WITH OVERALL WAGE MOVEMENTS FOR WORKERS IN HONG KONG AND GIVES THE LIE TO THE SUGGESTION THAT CIVIL SERVANTS HAVE NOT BENEFITED ALONG WITH THE REST OF THE COMMUNITY FROM OUR OVERALL ECONOMIC DEVELOPMENT.

RECRUITMENT AND RETENTION OF STAFF HAVE ALSO BEEN SATISFACTORY. THE OVERALL VACANCY POSITION HAS REMAINED STABLE AT ABOUT 3% SINCE 1991. THIS IS INDICATIVE OF THE COMPETITIVENESS OF EXISTING CIVIL SERVICE SALARIES. OUR WASTAGE RATES ARE ALSO THE ENVY OF MANY PRIVATE SECTOR EMPLOYERS, INDICATING THAT CIVIL SERVANTS DO NOT FEEL DISSATISFIED WITH THEIR LOT.

/PAY ADJUSTMENT