TNAG-0822-FCO40-1029-Policy-on-salaries-for-civil-servants-in-Hong-Kong-1978 — Page 401

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Encl. 2

Encl. 3

Increments

10.

When Members were advised orally on 10th May 1978 of the progress on the 1978 Pay Review, an undertaking was given to explain how allowance was made for the Civil Service incremental system. This is a question which has been referred to from time to time and at Enclosure 2 are extracts on this subject from a Memorandum for the Executive Council discussed in February 1976.

11.

Although encouraged to do so, a number of companies remain unable to separate out the various factors, including merit, making up their pay adjustments. These are amongst the (usually smaller) companies which do not operate on the basis of pay scales or pay ranges (with pre-determined maxima and minima), and where increases are either ad hoc decisions or based upon empirical judgement rather than built up from the various considerations such as movements in the cost of living, profitability, merit, or market competi- tion factors.

12.

In collecting evidence, the Pay Investigation Unit seeks to separate out merit elements where such exist and where these can be identified. Where these elements cannot be identified, an average of all the increases awarded is taken as an indication of that company's general pay movement and this figure is included in the calculations on which Civil Service pay is based. It is relevant that at the present time less than half of the Civil Service are eligible for annual increments, either because they are not on incremental scales or because they have already reached the maximum point.

Proposals 13.

It is proposed that a service-wide pay increase should now be made, to the nearest 5, to reflect as closely as possible the evidence of private sector overall pay movements shown at paragraphs 7 and 8 above.

Master Pay Scale

14.

MM TADNOT

It is proposed that the Master Pay Scale be revised upwards to give a tapered increase from 9.27% at the bottom point of the bottom band to 6.93% at the top band.

The simple average of the increases at each M.P.S. point is 7.99% compared with the average of 8% for the private sector overall. A copy of the proposed scale is at Enclosure 3.

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