For discussion EC(96-97)42
on 13 November 1996

ITEM FOR ESTABLISHMENT SUBCOMMITTEE
OF FINANCE COMMITTEE

HEAD 46 - GENERAL EXPENSES OF THE CIVIL SERVICE
Subhead 003 Recoverable salaries and allowances (General)

Members are invited to recommend to Finance Committee the retention of the following supernumerary post in the 1997 - 98 draft Estimates -

1 Administrative Officer Staff Grade B1
(D4) ($135,800 - $139,950)

PROBLEM

The Hong Kong Export Credit Insurance Corporation (HKECIC) has requested the Government to continue to second a senior civil servant to fill its Commissioner post.

PROPOSAL

2. We propose to retain one supernumerary post of Administrative Officer Staff Grade B1 (AOSGB1)(D4) for one year to allow for the continued secondment of a civil servant to the HKECIC as Commissioner.

JUSTIFICATION

3. The Government established the HKECIC in 1966 as Hong Kong's official export credit insurer, providing protection for Hong Kong manufacturers and exporters against the risk that they may not receive payment for goods and services supplied to overseas clients. The HKECIC Ordinance (Cap 1115) defines the powers and functions of the Corporation. The Chief Executive of the HKECIC is the Commissioner, who has legal authority to implement and execute, on the Corporation's behalf, its power, functions and duties. The Government guarantees the Corporation’s maximum contingent liability, currently standing at $7,500 million.

4. The HKECIC needs a Commissioner who is a capable administrator and a strong manager, as well as someone with a sound grasp of the principles and practice of international trade and finance. Since 1984, we have seconded a senior civil servant at AOSGB1 level to the post. This has facilitated an interchange of valuable and beneficial experience to both the HKECIC and to the Government. The secondment affords an opportunity for civil servants to acquire experience in an important field of commerce and industry and provides the Corporation with an officer with strong administrative experience and well versed in the Government machinery. Since the Corporation is governed by statute and needs to work closely with the Government, secondment brings cross-fertilisation of knowledge and experience and enhances the understanding of both sides.

5. A Consultancy Study commissioned by the Secretary for Trade and Industry in 1994 on the management needs of the HKECIC confirmed the desirability of the secondment arrangement. The Consultant concluded that it was appropriate for a senior civil servant who had extensive working experience in the various Government departments to head the Corporation. The Consultant also recommended that in the longer term consideration should be given to groom qualified senior managers for the position. Government and the Corporation support the Consultant's recommendations. The Corporation has been taking various measures to give its more senior officers the exposure and depth of experience necessary for them to assume greater responsibilities in the longer term. This process will continue. At present there is still no one within the HKECIC suitable to assume the post of Commissioner.

6. A list of the overall and specific responsibilities of the post of Commissioner, HKECIC is at the Enclosure.

FINANCIAL IMPLICATIONS

7. The notional annual salary cost of this proposal at mid-point is -


$

No. of Post

Supernumerary post

1,679,400

1

8. The full annual average staff cost of the proposal, including salaries and staff on-cost, is $2,965,560. We shall recover the full cost, including the staff on-cost, of the proposal from the HKECIC.

9. The proposal has no other financial or staffing implications.

BACKGROUND INFORMATION

10. We have created in 1984 a supernumerary AOSGB1 post to provide for the secondment of a senior civil servant to the HKECIC. We have since retained the post annually in the context of the draft Estimates.

ADVICE OF THE STANDING COMMITTEE ON DIRECTORATE SALARIES AND CONDITIONS OF SERVICE

11. As the AOSGB1 post is proposed on a supernumerary basis, its retention, if approved, will be reported to the Standing Committee on Directorate Salaries and Conditions of Service in accordance with the agreed procedure.

Civil Service Branch
October 1996

Enclosure to EC(96-97)42

Duties and Responsibilities Commissioner for the HKECIC

I. Overall Responsibilities

As head of the Corporation, the Commissioner, with the advice of the HKECIC Advisory Board, supervises and monitors the operation of the HKECIC within the powers and functions as defined in the HKECIC Ordinance (Cap 1115), and where appropriate and justified, makes recommendations to the Hong Kong Government for any modifications to the Corporation's powers and functions to meet the business and administrative needs of the Corporation.

II. Specific Responsibilities (Internal)

  1. to promote and monitor the business of the Corporation within approved policy in relation to the conduct of its business, namely -
    1. the classes of insurance contracts into which the Corporation is empowered to enter;
    2. the nature and extent of risks that may be covered under contracts of insurance entered into by the Corporation;
    3. the undertaking of liabilities;
    4. the giving of guarantees;
  2. to determine and oversee the organisation of the finances of the Corporation, particularly in the following areas -
    1. the total amount of capital and reserves required by the Corporation taking into account the sums at risk under contract of insurance;
    2. the investment policy of any surplus acquired by the Corporation;
    3. the raising of loans or mortgages whether on security or not;
    4. the acquisition of fixed assets;
    5. the movements of the underwriting accounts;
    6. the forecasting and monitoring of the administration account of the Corporation;
    7. the preparation of the Corporation's annual report and statement of accounts;
  3. to service the HKECIC Advisory Board and seek the Board's advice on matters relating to the Corporation's conduct of business; and
  4. supervision and appointment of all staff employed by the Corporation and overall administration of the Corporation.

III. Specific Responsibilities (External)

  1. to liaise with and report to the authorities of the Hong Kong Government on matters relating to the powers, functions and business of the Corporation and to seek advice or approval where appropriate;
  2. to liaise with local financial institutions/business organisations and make agreements on behalf of the Corporation on financial transactions relating to the Corporation's business;
  3. to liaise, negotiate and make agreements with overseas re-insurers on all matters relating to re-insurance contracts which the Corporation enters into with re-insurers;
  4. to represent the Corporation at the Berne Union and to promote the interest of the Corporation at the Union; and
  5. to liaise or keep in contact with overseas export credit institutions and to monitor developments in the field of export credits in overseas countries.

Last Updated on 12 August 1999