Panel on Public Service (Minutes) 24 Nov 97

Provisional Legislative Council

PLC Paper No. CB(2) 755
(These minutes have been seen
by the Administration)

Ref : CB2/PL/PS/1

Panel on Public Service

Minutes of meeting held on Monday, 24 November 1997 at 10:45 am in Conference Room A of the Legislative Council Building

Members present :

Hon IP Kwok-him(Chairman)
Hon LEE Kai-ming (Deputy Chairman)
Hon Mrs Elsie TU, GBM
Hon Mrs Selina CHOW, JP
Hon CHAN Wing-chan
Hon Andrew WONG Wang-fat, JP
Dr Hon Philip WONG Yu-hong
Hon Ambrose LAU Hon-chuen, JP
Hon CHENG Yiu-tong

Members absent :

Hon David CHU Yu-lin	] other commitments
Hon Ronald ARCULLI, JP	]

Public officers attending :

Mr W K LAM: Secretary for the Civil Service

Item III

Ms Anissa WONG: Deputy Secretary (Civil Service)3

Item IV

Ms Sandra LEE: Deputy Secretary (Civil Service)1
Mr Thomas CHAN: Principal Assistant Secretary (Civil Service) (Acting); Development Institute

Item V

Mr D W PESCOD: Deputy Secretary (Civil Service)2

Clerk in attendance :

Mrs Sharon TONG: Chief Assistant Secretary (2)1

Staff in attendance :

Mr Paul WOO: Senior Assistant Secretary (2)5

I.Confirmation of minutes of meetings

(PLC Paper Nos. CB(2) 615 and 644)The minutes of meetings held on 22 September 1997 and 14 October 1997 were confirmed.

II.Date of next meeting and items for discussion

2.The next regular meeting of the Panel would be held on Monday, 22 December 1997 to discuss the following items :

Review Board on representations relating to appointment, dismissal and discipline of civil servants; and
Review of organization of the Protocol Division

III.Staff recognition proposals in trading fund departments
(PLC Paper No. CB(2) 639(01))

3.Deputy Secretary (Civil Service)3 (DS(CS)3) briefed members on PLC Paper No. CB(2) 639(01), which set out the objectives of, and guiding principles governing, civil service wide staff recognition schemes and similar measures undertaken in trading fund departments to motivate staff for improving efficiency and providing better services to the public.

4.DS(CS)3 advised that of the four civil service wide staff recognition/motivation schemes, viz. Long Service Travel Award, Staff Motivation, Staff Suggestion and Long and Meritorious Service Certificates Schemes, no cash awards were provided except under the Staff Suggestion Scheme, where the awards ranged from a certificate of commendation to a cash award up to a ceiling of $15 000 on the merits of the suggestions. There was no restriction as to whether an officer could receive an award under the Suggestion Scheme for more than one time. At members' request, DS(CS)3 undertook to provide information on the number of officers who had previously received the maximum cash award of $15 000 and the highest cumulative amount won by a single officer under the Scheme.

Adm

5.Members were concerned that as some incentive schemes were self-financed by trading funds, these activities might overstep the principles laid down by the Government. DS(CS)3 replied that trading funds were given the flexibility to organize their own schemes, using their own resources and having regard to their particular service culture in operating in a commercial environment. However, the schemes would still have to be formulated within the framework of maintaining service wide parity in pay and conditions with no adverse financial implications. In particular, incentive awards should be in kind and not in cash, and should be subject to service-wide cash limits for the respective staff motivation measures. Any proposed schemes would be discussed and agreed among the policy bureau, Finance Bureau, Civil Service Bureau and the trading funds before their implementation. DS(CS)3 said that similar guiding principles applied to service-wide staff motivation schemes. Apart from the Long Service Travel Award which was funded and administered centrally, the other three schemes were mainly administered by Heads of Departments, who sought necessary resources and develop appropriate incentive measures having regard to the service-wide guidelines. DS(CS)3 agreed to provide information to highlight some examples of staff recognition/motivation activities undertaken by Government departments other than trading fund departments.

Adm

6.Concerning resources used by trading fund departments in organizing staff motivation activities, DS(CS)3 said that subject to the relevant guidelines, respective departments decided on the performance indicators and levels of award, with due regard to the size, nature and operations of the trading funds concerned. The schemes set up by the Companies Registry and Land Registry, for example, involved resource estimates of $450 000 and $76 000 respectively in 1997/98. As the schemes were self-financed by the trading funds, the activities could be affected in the event of deficit incurred by the trading funds. With regard to the financial limits of the awards under the civil service wide schemes, DS(CS)3 advised that they would be adjusted as and when necessary. Under normal circumstances, all staff, including temporary staff, could participate in the motivation activities. Awards provided under some schemes, however, were offered to particular classes of officers. The Long Service Travel Award, for example, was operating on the basis of granting travel allowance to non-directorate officers and their spouses subject to years of service and performance. The Long and Meritorious Service Certificates Scheme, on the other hand, was to award officers who had served for twenty years or more with satisfactory performance. Officers who failed to fulfil the merit standard, notwithstanding their long service, would not be eligible for the award.

7.As regards assessment criteria, DS(CS)3 said that awards were given out in recognition of improvement in performance as measured by a set of balanced and objective indicators reflecting efficiency, effectiveness and standard of service. Customer opinion surveys had been a common yardstick for assessment under the various schemes.

IV.Transfer from agreement to local permanent and pensionable terms in the civil service
(PLC Paper No. CB(2) 518(01))

8.Deputy Secretary (Civil Service)1 (DS(CS)1) explained the background and circumstances leading to the introduction of a set of revised arrangements and criteria for transfer to local permanent and pensionable (P&P) terms for all serving officers on local agreement terms (LAT) and locally modelled agreement terms (LMT). Details of the arrangements were set out in PLC Paper No. CB(2) 518(01).

9.DS(CS)1 advised that the revised arrangements were to give effect to the Court of Appeal's judgement handed down on 22 November 1996, which resulted in the lifting of the suspension on all applications for transfer to local P&P terms previously imposed on 31 October 1995, and allowing all LMT officers the opportunity to apply for further transfer to local P&P terms on the same criteria applicable to LAT officers. The Administration put forward the revised arrangements for consultation with staff associations in February 1997 and had had several rounds of discussions with them since then. An issue involved in the arrangements, which was not supported by one of the staff associations, viz. the Association of Expatriate Civil Servants of Hong Kong (AECS), was the Chinese language requirement for transfer. In the opinion of AECS, the requirement was a unilateral derogation of existing conditions of service for serving officers and therefore unlawful. The Government, however, held the view that the requirement of Chinese language proficiency was consistent with the long-term policy objective to develop a biliterate, trilingual civil service, and that it was reasonable to require officers transferring to local P&P terms (which offered a career in the civil service up to retirement) to be proficient in both the English and Chinese languages. DS(CS)1 explained that the new arrangements allowed flexibility in that exemptions for individual officers could be approved in specific cases where justified. In addition, LAT and LMT officers who failed in their applications for transfer on account of failing the language requirement could continue to serve on agreement terms provided that they fulfiled the usual criteria for renewal of agreements. These officers were given the opportunity to apply again for transfer to local P&P terms, i.e. once during each agreement. The Administration would help provide language training for the officers. As the language requirement applied to both LAT and LMT officers, there was no question of discrimination. The Government was satisfied that the revised arrangements and criteria complied with the principles of "fairness, genuine need, rationality and proportionality " emphasized in the Court of Appeal judgment.

10.In reply to Mr LEE Kai-ming's question, DS(CS)1 said that it was not practicable to list out the posts to which exemption from the Chinese language requirement could be granted because exemption would have to be considered on the basis of individual officers having regard to the post(s) he would be expected to fill. For example, exemption would be granted on a personal basis where the officers were not required to have such language proficiency during their service from the date of transfer up to normal retirement age, or where the officers were required to fill specialist posts which did not require Chinese language proficiency. Factors such as the number of years of service of the officer before retirement and the need for posting arrangements etc. would have to be taken into consideration. The Heads of Departments/Grades were responsible for submitting cases for exemption for approval by the Civil Service Bureau.

11.Members noted that AECS was again seeking judicial reviews on a number of matters arising from the Government's measures to give effect to the courts' judgments, which included the eligibility and criteria for transfer to local P&P terms. Members were concerned about the consequences of the challenges and asked whether the Government would take action to avert the conflicts of a further legal wrangle. DS(CS)1 said that the AECS's ground for objection was based on a legal point argument that all serving agreement officers regardless of whether they were on overseas or local terms and who were permanent residents (PRs) of Hong Kong should be allowed to transfer to local P&P terms under the criteria prevailing before the freeze on 31 October 1995, i.e. without a Chinese language requirement. DS(CS)1 said that this would be a matter subject to the interpretation of the court. On the policy side, as part of the Government's localization policy, overseas officers were only recruited on overseas agreement terms from 28 March 1985 onwards and these officers were not given the option to transfer to P&P terms at the time of appointment. OAT officers appointed before that date had been allowed up to 30 June 1992 to apply for transfer to overseas P&P terms. To permit all agreement officers, including OAT officers, to transfer to local P&P terms would go against the existing policy. DS(CS)1 advised that the present revised arrangements had achieved a right balance between giving effect to the Court of Appeal judgment, which ruled that prohibiting LMT officers from transferring to local P&P terms was unlawful, and addressing the long-term operational needs of the civil service. She added that the suspension imposed on all applications from LAT and LMT officers for transfer to P&P terms since October 1995 had resulted in the need to extend agreements repeatedly for short periods. This had created uncertainties to both officers who wished to transfer to P&P terms and departmental management. The early implementation of the new arrangements would remove these uncertainties. DS(CS)1 said that the Administration would decide if further adjustments to the transfer arrangements were required after the result of the judicial reviews sought by AECS was available.

12.In response to members' enquiries, DS(CS)1 said that the Administration had no statistics on the number of OAT officers with PR status because only OAT officers who wished to transfer to local terms were required to prove their PR status. She added that at present there were about 200 LMT officers. The total number of LMT and OAT officers was about 900, about 300 of them were serving in the Police Force. Most overseas officers were around the age of 40-50. There were about 800 LAT officers. DS(CS)1 further advised that with the lifting of the temporary suspension on transfer to local P&P terms, 77 LAT officers who had already submitted application for transfer before 31 October 1995 and 81 LMT officers who transferred to LMT before 31 October 1995 were exceptionally allowed to apply for transfer to local P&P terms under criteria prevailing before 31 October 1995, i.e. without a Chinese language requirement. This was because those officers could have applied and transferred to local P&P terms under the criteria prevailing then. Members requested the Administration to advise in writing as to whether a requirement of declaration of PR status by civil servants violated the Personal Data (Privacy) Ordinance, and the statistics on the successful applications for transfer from overseas agreement terms to P&P terms vis-a-vis the number of such applications.

Adm

13.Mr Andrew WONG Wang-fat said that the end solution to the dispute between the Government and overseas agreement officers would be to allow all agreement officers who were PRs to apply for transfer to local P&P terms. He considered it more appropriate to apply the Chinese language requirement for other purposes such as promotion of officers, rather than as a criterion for serving officers to apply for transfer to local P&P terms.

14.DS(CS)1 informed members that the judicial reviews brought by AECS would be heard on 28 November 1997. At members' request, the Administration undertook to revert to the Panel on the result of the judicial reviews and the progress of implementation of the transfer arrangements at the next Panel meeting in December.	Adm

V.Review of school and leave passage arrangements for civil servants

15.Deputy Secretary (Civil Service)2 (DS(CS)2) elaborated on the proposed changes to school and leave passage arrangements for civil servants as a result of a recent review of the two benefits. In brief, for school passages, the Administration proposed to replace the current provision of air tickets under an Air Passage Agreement (APA) at published fare rates with a fully accountable allowance set at 75% of the published student fare, or, if unavailable, at 75% of the lowest applicable Economy Class fare for the respective routes. Staff might use the allowance to acquire tickets for their children from any airline to suit their circumstances. As for leave passages, it was proposed to remove the pegging to discounted Business Class contract fares under the APA by severing the present linkage between leave passage allowance (LPA) (for both local and overseas officers) and contract published fares, and to revise the rates every year with reference to movement of package tour prices within the Consumer Price Index (CPI). The rationale for this was that at present, most (about 95%) of the recipients used LPA to meet package tour expenses. The proposed change would provide a more appropriate base for adjusting LPA. The Administration expected that the new arrangements for school passage allowance (SPA) would achieve cost saving because cheaper fares available in the market could now be used. The proposed SPA, which was 25% lower than the published student fare or lowest Economy Class fare, would result in immediate saving estimated at $17 million per annum.

16.In response to enquiries by the Chairman and Mr CHAN Wing-chan, DS(CS)2 said that the Administration would ensure that the setting of the new SPA at 75% of the published student air fare would provide the same standard of travel for the students. Under the new SPA arrangements, officers could choose with greater flexibility such that they could acquire tickets from the airline which offered the services best suited to their needs. The advantage to the Government, on the other hand, was that it would considerably reduce administration costs, in addition to the actual cost saving, involved in the provision of tickets for eligible staff. With regard to the arrangement for any unspent allowance not exceeding the child's total entitlement for a 12-month cycle to be carried forward to the next cycle, DS(CS)2 explained that it provided greater flexibility for the parents to use SPA to cater for the travel needs of their children at no extra cost to the Government. The "roll-over " was limited to two years for the purpose of SPA.

17.Mrs Selina CHOW enquired about the mechanism for revising LPA under the new arrangements. DS(CS)2 explained that all future adjustments of LPA would be made in accordance with the CPI movement in respect of package tours. The average rate of increase of the package tour prices was lower than that of the air fare since 1990/91. However, at staff's request, the Administration agreed to provide an overseas officer with an air ticket if adjustments of LPA over time resulted in the entire amount of LPA for a full cycle being insufficient to allow the officer to buy a direct passage of his entitled class between Hong Kong and the officer's place of origin. DS(CS)2 said that the Government's undertaking was meant to be an ultimate safety net to deal with what would be a rare situation, since the vast majority of the destinations were currently covered by package tours. The above agreed arrangement was in line with overseas officers' contractual terms of employment.

18.In response to the Chairman's enquiry about leave-earning for senior officers in the civil service, DS(CS)2 advised that a system of leave forfeiture was in place for overseas officers which provided that for each day they spent on leave in Hong Kong, two days would be deducted from their leave balance. The reason was that leave for an overseas officer included a home-bound element specifically to allow extra time for them to travel to their places of origin. In the event of overseas officers choosing to take leave not for a home-trip, that extra addition of leave entitlement should be forfeited. DS(CS)2 said that the Administration had conducted a review some years ago and decided that the same arrangement should also apply to local directorate officers at above D4 level.

19.The Chairman considered the system as unfair as the majority of senior directorate posts were now filled by local officers. Members agreed to examine the matter separately in greater detail at a future meeting of the Panel.

VI.Close of meeting

20.The meeting ended at 12:25 pm.

Provisional Legislative Council Secretariat
9 December 1997