EC(97-98)46
For discussion
on on 14 January 1998


ITEM FOR ESTABLISHMENT SUBCOMMITTEE OF
FINANCE COMMITTEE

HEAD 26 - CENSUS AND STATISTICS DEPARTMENT
Subhead 001 Salaries

Members are invited to recommend to Finance Committee the creation of the following permanent post in the Census and Statistics Department with effect from 1 April 1998 -

1 Assistant Commissioner for Census and Statistics

(D2) ($110,000 - $116,800)

PROBLEM

The Census and Statistics Department (C&SD) requires additional support at the Assistant Commissioner level to carry out the responsibilities required for meeting the Special Data Dissemination Standard (SDDS) established by the International Monetary Fund (IMF), with which Hong Kong has committed to comply.

PROPOSAL

2. The Commissioner for Census and Statistics (C for C&S) proposes to create a permanent post of Assistant Commissioner for Census and Statistics (AC for C&S) (D2) in the C&SD.

JUSTIFICATION

The existing structure

3. The directorate establishment of the C&SD comprises the C for C&S (D5), Deputy Commissioner for Census and Statistics (DC for C&S) (D3), and four AC for C&S (D2). The existing organisation of the department is at Enclosure 1. The Administration Branch and the Research Branch are directly responsible to the DC for C&S. The other branches are grouped into four functional divisions under the respective ACs for C&S. The areas of responsibility of the four divisions are as follows -

  1. General Division

    Responsible for statistics relating to employment and wages; the Central Register of Establishments; and support services for the department in electronic data processing, human resource management and publications.

  2. Social Division

    Responsible for population censuses and demographic statistics; labour force statistics; and statistics concerning the general social situation in Hong Kong.

  3. Economic 'A' Division

    Responsible for statistics on external trade and national accounts. 1

  4. Economic 'B' Division

    Responsible for price statistics and sectoral economic statistics such as those on business services (including trade in services), manufacturing, construction, transport, distributive trades, restaurants and hotels.

4. In addition to the departmental responsibilities mentioned above, the divisions are also responsible for providing professional supervision for some 40 statistical units in various policy bureaux and departments and for providing statistical advice to bureaux/departments where no such units have been established.

Increase in volume, scope, and complexity of work

5. During the past decade, the directorate establishment has remained unchanged while the workload and responsibilities of the department have increased substantially in response to demand from both the public and private sectors on the scope and level of details of statistics produced by the department.

6. In respect of economic statistics undertaken by the Economic 'A' and Economic 'B' Divisions of the department, Hong Kong's growing importance as an international trade and financial centre has resulted in increased demand for more comprehensive and quality statistics on Hong Kong's economic structure and performance to facilitate analysis by foreign and local investors, economic/financial analysts, academic researchers and international organizations. The following are major examples of the expansion and enhancement in work that were made in recent years -

  1. launching an annual survey to collect data on external factor income flows, enabling the compilation of estimates of Hong Kong's gross national product (GNP) in addition to the gross domestic product (GDP);

  2. launching an annual survey to produce statistics on external investment in Hong Kong's non-manufacturing sectors;

  3. producing more statistics on the services sector to support government's initiative on service promotion. These include quarterly indices on business receipts for major service industries, and more detailed breakdown of the type of service and classification by country for statistics on trade in services. Also, more detailed statistics will soon be available on the operating characteristics of some fast growing service industries;

  4. introducing the system of processing import/export declarations by electronic data interchange (EDI), and undertaking development work towards the targets of extending the EDI service to declarations in Chinese, phasing out paper declarations entirely by 2000 and implementing EDI for processing cargo manifests;

  5. launching surveys to collect data on insurance and freight costs for imports, providing statistics on Hong Kong's imports of goods on free-on-board basis, in addition to the existing set of import statistics on cost-insurance-freight basis; and

  6. enhancing the system of shipping statistics to provide more detailed cargo statistics, including those on transhipment.

Compliance with the SDDS

7. The Government of the Hong Kong Special Administrative Region has made a commitment to the IMF to meeting the SDDS. The SDDS is a standard concerning the provision of economic and financial data to the local public and the international community. It aims at enhancing the transparency of the economic and financial situation of economies. It has stipulations on the coverage, periodicity and timeliness of data; access by the public; integrity of the disseminated data; and quality of data. While much of the expansion and enhancement in work mentioned in paragraph 6 above is required to ensure Hong Kong's compliance with the SDDS, there are still areas where additional work by the department is needed for meeting the requirements specified in the SDDS. These include the compilation of a complete set of Balance of Payments (BoP) statistics; and timeliness of production of GDP estimates, industrial production index, earning statistics and some other economic indicators.

8. In regard to the compilation of BoP statistics, the Economic 'A' Division is currently undertaking a study on the approach. We plan to complete the study by March 1998, and will then commence work to set up a statistical system for compiling BoP statistics for Hong Kong. The system will be a complex one, representing a significant expansion in the activities of the department. It will involve the launching of large-scale surveys to collect data on Hong Kong's external claims and liabilities, in coordination with the existing data collection mechanism on external income flows while paying heed to the need to minimize reporting burden for data suppliers. We need to coordinate with the national accounting system to ensure a fully compatible framework of national accounts and BoP statistics; and to liaise with relevant local and international organisations to ensure that we meet the requirements of statistical users as well as international statistical standards. The proper implementation of the BoP system will therefore require close attention from a directorate officer.

9. Apart from the BoP system, there is also the demand for enhancements in various areas of economic statistics to achieve full compliance with the SDDS, particularly regarding the following aspects -

  1. modifying various surveys and estimation processes with a view to advancing the release of quarterly statistical series (including GDP estimates and industrial production index);

  2. compiling more detailed statistics on specific service products (such as telecommunications services and computer services);

  3. developing more timely statistical indicators on the imports and exports of services; and

  4. compiling producer price indices for selected service industries with a view to producing a productivity index for the services sector.

Need for an additional Assistant Commissioner

10. To carry out the above committed statistical activities, we will create an additional 55 non-directorate staff in April 1998. As the existing directorate resources are already stretched to their limits, we need one additional AC to spearhead the development and the subsequent implementation of the complex BoP system and to provide the additional capacity required at the directorate level for monitoring developments in and supervising the operations of economic statistics.

11. We propose, with the creation of an additional AC post, organising the responsibilities of the department in respect of economic statistics into three divisions as follows -

  1. Economic 'A' Division

    Responsible for external trade and price statistics.

  2. Economic 'B' Division

    Responsible for sectoral economic statistics such as those on business services (including trade in services), manufacturing, construction, transport, distributive trades, restaurants and hotels; including statistics on business performance, operating characteristics and productivity.

  3. Economic 'C' Division

    Responsible for national accounts and BoP statistics.

There will be no change to the General and Social Divisions.

12. The proposed additional AC will take charge of the new Economic 'C' Division, and be responsible for overseeing the statistical systems for compiling GDP and GNP estimates; directing the survey systems to collect data for compiling BoP statistics and monitoring the setting up and operation of related survey frames, data processing system and office control/checking system; supervising the conduct of analytical studies on national accounts and BoP statistics; and giving general support and advice to the Commissioner and DC for C&S on professional matters relating to national accounts and BoP statistics. By placing these responsibilities within the same Division, we can develop all the statistical work relating to national accounts and BoP statistics in a properly coordinated manner.

13. The proposed re-allocation of duties for the existing Economic 'A' and Economic 'B' Divisions will enable the two respective ACs to cope with the increase in scale and complexity of their work areas, particularly in services sector statistics and trade statistics, for full compliance with the requirement of the SDDS.

14. The proposed organisation for the department is at Enclosure 2; and the proposed job descriptions for the three ACs in charge of the Economic 'A',Economic 'B', and Economic 'C' Divisions are at Enclosure 3.

FINANCIAL IMPLICATIONS

15. The additional notional annual salary cost of this proposal at MID-POINT is -

$

No. of Post



New permanent post

1,360,800

1

16. The additional full annual average staff cost of the proposal, including salaries and staff on-costs, is $2,512,596. We will include sufficient provision in the 1998-99 draft Estimates to meet the cost of this proposal.

17. In addition, in order to meet the requirement of the SDDS, we will create an additional 55 non-directorate posts at a notional annual mid-point salary cost of $17,181,780 and a full annual average staff cost of $28,324,093. We will create these posts during 1998-99 under the normal Departmental Establishment Committee mechanism.

BACKGROUND INFORMATION

18. Hong Kong has subscribed to the SDDS of the IMF since April 1997. It is a guide to economies in the provision of economic and financial data to the public set up by the IMF in 1996, against the background of the Mexican currency crisis in 1995, with the purpose of encouraging economies aspiring to be heavily engaged in capital markets to provide timely, comprehensive and reliable statistics for enforcing the necessary surveillance of the financial market to avoid recurrence of similar crisis.

19. Although the SDDS is a voluntary standard, it has a strong compelling nature as economies subscribing to it are put onto IMF's electronic Data Standards Bulletin Board (DSBB) on the Internet. Inclusion on the DSBB is essential for consolidating Hong Kong's position as an international financial centre. As of November 1997, over 40 other economies have subscribed to the SDDS, including the USA, Canada, Japan, Singapore, Federal Republic of Germany, France and the United Kingdom.

20. The SDDS consists of four dimensions: (a) the data dimension (referring to coverage, periodicity and timeliness of data); (b) access by the public; (c) integrity of the disseminated data; and (d) quality of the disseminated data. Data are categorized into four sectors, i.e. real sector, financial sector, fiscal sector and external sector. Three agencies in Hong Kong are involved in supplying the required data, viz. the C&SD for data in the real sector and the external sector (except data on international reserves), the Hong Kong Monetary Authority for data in the financial sector and data on international reserves, and the Finance Bureau for data in the fiscal sector.

21. Insofar as the C&SD is concerned, while we have already met most of the requirements of SDDS, there are a few areas in which additional work is needed. These include the compilation of a complete set of BoP statistics; and timeliness of production of GDP, industrial production index, earning statistics and some other economic indicators.

22. BoP statistics reflect all external transactions between residents of an economy with residents of the rest of the world in goods, services, income and current transfers (i.e. the Current Account), as well as external capital and financial transactions in capital transfers, financial claims and liabilities and non-produced non-financial assets (i.e. the Capital and Financial Account). Existing statistical systems in Hong Kong provide most of the data required for compiling the Current Account; and data which are most lacking are those relating to financial transactions in the Capital and Financial Account.

CIVIL SERVICE BUREAU COMMENTS

23. The Civil Service Bureau agrees that the grading and ranking of the proposed post is appropriate having regard to its job nature and responsibilities.

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

24. The Standing Committee on Directorate Salaries and Conditions of Service has advised that the grading proposed for the post would be appropriate if the post were to be created.

Financial Services Bureau

December 1997

1. National accounts, an internationally accepted statistical term, refers to an integrated set of macroeconomic accounts that serve to provide an overall, comprehensive record of the economic activities taking place within an economy, the interaction between different sectors in the economy as well as between the economy and the rest of the world. Gross domestic product and gross national product are some of the key aggregate statistics covered in the system of national accounts.

Enclosure 3(a) to EC(97-98)46

Proposed Duty List for the
Assistant Commissioner for Census and Statistics (Economic) A

  1. To monitor the implementation of established policies in respect of trade statistics and price statistics. To review existing policies, to develop and formulate new policies and to review statistical legislation.

  2. To exercise supervision over the work of subordinate staff to ensure that -

    1. deadlines are met;

    2. statistical standards, including the Special Data Dissemination Standard, are adhered to;

    3. statistical integrity is maintained;

    4. confidentiality is observed in respect of individual company or personal data;

    5. legislative requirements are observed; and

    6. resources are used in the most cost-effective manner.

  3. To plan and develop statistical services and methods in respect of trade statistics and price statistics.

  4. To coordinate different statistical systems and survey operations in trade statistics and price statistics to avoid duplication or gaps, to standardize statistical definitions and classifications as far as possible, to minimize burdens on survey respondents, and to bring about the effective dissemination of statistical information.

  5. To direct the undertaking of statistical operations, ensuring in particular the co-operation of outside bodies, implementation of appropriate security measures against forgery and impersonation, and the proper production of statistical data and analyses.

  6. To represent the Department on various Working Groups and Committees.

Enclosure 3(b) to EC(97-98)46

Proposed Duty List for the
Assistant Commissioner for Census and Statistics (Economic) B

  1. To monitor the implementation of established policies in respect of sectoral economic statistics, including those on business services, manufacturing, construction, transport, distributive trades, restaurants and hotels. To review existing policies, to develop and formulate new policies and to review statistical legislation.

  2. To exercise supervision over the work of subordinate staff to ensure that -

    1. deadlines are met;

    2. statistical standards, including the Special Data Dissemination standard, are adhered to;

    3. statistical integrity is maintained;

    4. confidentiality is observed in respect of individual company or personal data;

    5. legislative requirements are observed; and

    6. resources are used in the most cost-effective manner.

  3. To plan and develop statistical services and methods in respect of sectoral economic statistics; including statistics on business performance, operating characteristics and productivity.

  4. To coordinate different statistical systems and survey operations in sectoral economic statistics to avoid duplication or gaps, to standardize statistical definitions and classifications as far as possible, to minimize burdens on survey respondents, and to bring about the effective dissemination of statistical information.

  5. To direct the undertaking of statistical operations, ensuring in particular the co-operation of outside bodies, implementation of appropriate security measures against forgery and impersonation, and the proper production of statistical data and analyses.

  6. To represent the Department on various Working Groups and Committees.

Enclosure 3(c) to EC(97-98)46

Proposed Duty List for the
Assistant Commissioner for Census and Statistics (Economic) C

  1. To monitor the implementation of established policies in respect of national accounts and balance of payments statistics. To review existing policies, to develop and formulate new policies and to review statistical legislation.

  2. To exercise supervision over the work of subordinate staff to ensure that -

    1. deadlines are met;

    2. statistical standards, including the Special Data Dissemination Standard, are adhered to;

    3. statistical integrity is maintained;

    4. confidentiality is observed in respect of individual company or personal data;

    5. legislative requirements are observed; and

    6. resources are used in the most cost-effective manner.

  3. To plan and develop statistical services and methods in respect of national accounts and balance of payments statistics.

  4. To coordinate different statistical systems and survey operations in national accounts and balance of payments statistics to avoid duplication or gaps, to standardize statistical definitions and classifications as far as possible, to minimize burdens on survey respondents, and to bring about the effective dissemination of statistical information.

  5. To direct the undertaking of statistical operations, ensuring in particular the co-operation of outside bodies, implementation of appropriate security measures against forgery and impersonation, and the proper production of statistical data and analyses.

  6. To represent the Department on various Working Groups and Committees.