ENG-2005 — Page 47

Constitution and Administration | 21

1. Streamlining the Civil Service Establishment

The Government has set a target to reduce the civil service establishment to around 160 000 by 2006-07. Through process re-engineering, organisational review and outsourcing, the civil service establishment has been reduced by about 17 per cent from about 198 000 in early 2000 to about 164 100 at the end of December 2005. Two rounds of the Voluntary Retirement Scheme (VRS) were introduced in 2000 and 2003 to enable staff in a total of 232 designated grades with an identified or anticipated staff surplus to retire from the service voluntarily with compensation and pension payments. Some 15 100 applicants have been approved to leave the service voluntarily to bring about long-term savings to the Government. In addition, a general recruitment freeze was imposed from April 1, 2003.

2. Reviewing Civil Service Pay and Benefits

The policy for the civil service pay is to offer sufficient remuneration to attract, retain, and motivate staff of a suitable calibre to provide the public with an effective, efficient and high quality service. In order that civil service pay can be regarded as fair and reasonable by both civil servants who provide the service and the public who foot the bill, the Government adopts the principle that civil service pay should be broadly comparable with private sector pay.

As part of ongoing efforts to modernise the management of the civil service, the Government has embarked on an exercise to develop an improved civil service pay adjustment mechanism for the long-term.

Following an extensive consultation exercise between November 2004 and January 2005, the Government decided in March to conduct a pay-level survey for the civil service. The survey fieldwork is expected to be completed in 2006.

Apart from salaries, civil servants are eligible for fringe benefits depending on their terms of appointment, rank, salary point, length of service, and other eligibility rules. The Government has been taking proactive steps over the years to modernise the provision of fringe benefits to civil servants, including either ceasing or tightening up payment of such allowances to new recruits to reflect present day circumstances. In September 2005, the Civil Service Bureau consulted staff on the proposals arising from the review on fringe-benefit type of allowances to ensure cost effectiveness and efficiency.

3. Improving the Entry and Exit System

The New Entry System for civil service recruits has given the Government increased flexibility in making appointments and a new retirement benefits system, the Civil Service Provident Fund Scheme, provides retirement benefits for officers appointed on New Entry terms.

The Management-initiated Retirement Scheme is also in place to allow the Government, for the purpose of organisational improvement, to initiate early retirement of individual directorate officers to make way for more dynamic and stronger leaders to rise to the top posts.