concern.
SECRET
In particular:
(i) Hong Kong wage statistics are based on a small sample
of wages paid by the larger firms; and only a wider sampling technique would reveal whether they are accurate or not. Per capita GDP in Singapore is 80% higher than in Hong Kong and Singapore's general air of prosperity gives an (admittedly impressionistic) feeling that wage levels are probably higher there. (ii) The Hong Kong research document comparing conditions
between Hong Kong and certain South East Asian countries, referred to in his paragraph 40, reveals that several Asian countries are in advance of Hong Kong on statutory hours of work, paid vacation leave etc.
(iii) The Despatch does not reveal how slow progress is in
implementing labour reform in Hong Kong. The limitation
(iv)
(v)
on hours for female labour, for instance, was seven years in gestation and even then contained important exceptions (we believe because of opposition in LegCo and ExCo).
In any case, we are bound to take these matters very seriously since it falls to us to justify both here and e.g. in the ILO any case where Hong Kong conditions are worse than in Hong Kong's neighbours. We recognise that there will be suspicion in Hong Kong over the motives for changes in labour legislation (his paragraph 43(b)) but, of course, we assume that change is resisted by the employers and not the employees.
On the minimum wage question, we are consulting the 1974 papers to which the Governor refers. There is some merit in the argument, in paragraph 37, that the rate can be set too high or too low; but we have to consider whether the local considerations (again based on broad generalisations about society) are not outweighed by the considerations, advanced by the TUC, that minimum wage legislation is of real value to
workers and there is a role for trade unions in
negotiating what the rates should be.
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