Panel on Manpower(Minutes) 22 April 99

Legislative Council

LC Paper No. CB(2) 2074/98-99
(These minutes have been seen
by the Administration)

Ref : CB2/PL/MP/1

LegCo Panel on Manpower

Minutes of meeting held on Thursday, 22 April 1999 at 2:30 pm in the Chamber of the Legislative Council Building

Members present:

Hon LEE Kai-ming, JP (Chairman)
Hon Kenneth TING Woo-shou, JP
Hon James TIEN Pei-chun, JP
Hon David CHU Yu-lin
Hon HO Sai-chu, JP
Hon Michael HO Mun-ka
Hon LEE Cheuk-yan
Hon Ronald ARCULLI, JP
Hon CHAN Kwok-keung
Hon CHAN Yuen-han
Hon CHAN Wing-chan
Hon CHAN Kam-lam
Dr Hon LEONG Che-hung, JP
Hon LEUNG Yiu-chung
Hon SIN Chung-kai
Hon Andrew CHENG Kar-foo
Hon SZETO Wah

Members absent:

Hon LAU Chin-shek, JP (Deputy Chairman): Dr Hon LUI Ming-wah, JP

Public Officers attending:

Item III
Mr Philip K F CHOK: Deputy Secretary for Education and Manpower
Ms Michelle LI: Principal Assistant Secretary for Education
and Manpower (Higher Education)
Mr TSANG Kin-woo, JP: Assistant Commissioner for Labour
(Labour Relations)
Mr Stephen AU: Chief Systems Manager
Vocational Training Council
Mr S S KWONG: Executive Director
Employees Retraining Board
Mr TANG Wah-shing: Executive Director
Occupational Safety and Health Council
Mr Tony YAU: Accounting Manager
Construction Industry Training Authority
Item IV
Mr Philip K F CHOK: Deputy Secretary for Education and Manpower
Mr A M REYNALDS: Principal Assistant Secretary for Education
and Manpower (Manpower Planning and Training)
Mr C S CHOI: Senior Statistician
Education and Manpower Bureau
Mr Y C TONG: Executive Director
Construction Industry Training Authority
Mr S S KWONG: Executive Director
Employees Retraining Board
Item V
Mr Philip K F CHOK: Deputy Secretary for Education and Manpower
Mr A M REYNALDS: Principal Assistant Secretary for Education
and Manpower (Manpower Planning and Training)
Prof LEE Ngok Executive Director Vocational Training Council
Mr S S KWONG: Executive Director
Employees Retraining Board
Item VI
Mr Herman CHO Principal Assistant Secretary for Education and Manpower (Occupational Safety)
Mr LEE Kai-fat, JP: Deputy Commissioner for Labour
(Occupational Safety & Health)
Mr William SIU: Assistant Commissioner for Labour
(Occupational Safety)
Mr MAK Hung-kae: Chief Safety Officer (Operation)
Labour Department

Clerk in attendance:

Mrs Sharon TONG: Chief Assistant Secretary (2)1

Staff in attendance:

Mr Raymond LAM: Senior Assistant Secretary (2) 5

I. Confirmation of minutes of meeting held on 28 January 1999
(LC Paper No. CB(2) 1739/98-99)

The minutes were confirmed.

II. Date of next meeting and items for discussion
(LC Paper No. CB(2) 1748/98-99(01))

2. The Panel decided to discuss the following items at the next meeting on 27 May 1999 :

Research report on minimum wage systems;
Progress of measures to create jobs and tackle unemployment; and
Follow-up on right of workers to go on strike or take industrial actions.

3. Mr David CHU said that with the restructuring of Hong Kong's economy, there was an increase in demand for overseas and mainland professionals. The Administration should review the policy on the entry of mainland professionals. As mainland professionals usually experience difficulties in leaving the mainland, the Administration should look into the issue with the mainland authorities. DSEM responded that the Security Bureau had started reviewing the policy on the entry of mainland professionals a month ago. The outcome of the review, which would take six months to complete, would be reported to the Panel.

Adm

4. Mr LEE Cheuk-yan said that some garment manufacturers who wished to import labour were reported to interview local job applicants simply to fulfil the requirements under the Labour Importation Scheme. He would provide a paper on the issue to the Administration for a response.

5. Miss CHAN Yuen-han advised that while the Administration said that many job vacancies were not filled, the salary of these jobs were very low. Deputy Secretary for Education and Manpower (DSEM) said that the Administration had already done a lot in employment service. The median wage reflected the prevailing demand and supply situation in the labour market.

III. Progress of Year 2000 compliance exercise in Government departments, Government-funded and Government-regulated organizations responsible for labour and manpower matters
(LC Paper Nos. CB(2) 1748/98-99(02) & CB(2) 1748/98-99(03))

6. At the request of the Chairman, DSEM highlighted the progress of the Year 2000 (Y2K) compliance exercise in the Education and Manpower Bureau (EMB) and the following departments and agencies under its purview -

Labour Department;
Vocational Training Council;
Clothing Industry Training Authority;
Construction Industry Training Authority;
Employees Retraining Board; and
Occupational Safety and Health Council.

He informed members that as at 15 March 1999, 85% of all mission-critical computer and embedded systems were confirmed to be Y2K-compliant. Rectification work for the remaining systems was expected to be completed by June 1999.

Labour Department

7. Assistant Commissioner for Labour (Labour Relations) informed members that there were 10 mission-critical systems in the Labour Department (LD), eight of which were Y2K-compliant. Rectification of the remaining two systems was expected to be completed by June 1999. He added that LD was in the process of installing a new and improved telephone enquiry service system which was Y2K-compliant in design and therefore required no rectification work. The computer system for employment services was Y2K-compliant and had been fully tested.

Vocational Training Council (VTC)

8. Chief Systems Manager of Vocational Training Council (CSM/VTC) informed members that VTC started examining the Y2K problem in 1996. Seven mission-critical systems were identified. Rectification of five of the systems had already been completed. Of the two remaining systems, one was being tested while rectification of the other one used for processing the salary of part-time staff was nearly completed. It was anticipated that all rectification work would be completed by June 1999. Employees Retraining Board

9. Executive Director of Employees Retraining Board (ED/ERB) said that there were six mission-critical systems in the Employees Retraining Board (ERB) and they were fully Y2K-compliant since December 1998.

Occupational Safety and Health Council

10. Executive Director of Occupational Safety and Health Council advised that there were four mission-critical systems and all these were fully Y2K-compliant.

Construction Industry Training Authority

11. Accounting Manager of Construction Industry Training Authority said that there were seven mission-critical systems in the Construction Industry Training Authority (CITA), among which three systems developed by consultants had been Y2K compliant at the end of 1998. Of the remaining four systems which were developed in-house, three were Y2K-compliant and rectification of the remaining one should be completed by the end of April 1999.

12. Mr HO Sai-chu said that there was a view that a computer system which was Y2K-compliant would be affected when communicating with a computer which was not Y2K-compliant. DSEM responded that, to his knowledge, such a situation should not occur. In this connection, Mr SIN Chung-kai said that the Y2K-compliance of a computer would not be affected when communicating with a computer which was not Y2K-compliant. However, the former might not be able to read a file sent from the latter. Joint testing should therefore be carried out by organizations having communication with each other. To safeguard the tested systems against any unforeseen problems, he considered that contingency plans should be drawn up for each system. In this respect, CSM/VTC advised that VTC had already drawn up contingency plans for its systems. In addition, the information technology staff of VTC would not take any vacation leave at the end of 1999 and would be on duty on 1 and 2 January 2000. VTC would also consider preparing its staff payroll of January 2000 in October 1999 and prepare a hard copy in advance for contingency purpose.

13. Principal Assistant Secretary for Education and Manpower (Higher Education) said that all departments and organizations under the purview of EMB were required to submit monthly progress reports on the Y2K-compliance of systems. They were required to draw up contingency plans for review by EMB. They were also requested to carry out testing on their systems and, as appropriate, conduct joint testing with other organizations. Members requested the Administration to report on the updated position and contingency plans of all departments and organizations under the purview of EMB when the next legislative session commenced in October 1999.

Adm

IV. A study on the manpower requirements for infrastructural projects
LC Paper No. CB(2) 1748/98-99(04)

14. At the invitation of the Chairman, DSEM highlighted the Administration's latest assessment of the manpower requirements arising from major infrastructural projects over the next three years. He pointed out that the assessment concentrated on the situation of on-site construction workers as this was the area where a substantial increase in demand was anticipated. As regards the manpower demand for each trade provided by the two railway corporations, the Administration was unable to assess their accuracy until more contracts were approved. DSEM undertook to provide further information in due course.

Adm

15. In reply to the Chairman's question on the difference between the statistics submitted under the Construction Labour Importation Scheme of 1998 and those provided in the paper, DSEM stated that the former was prepared from data collected in early 1998, whereas the latter was prepared from information gathered in the fourth quarter of 1998.

16. On the distribution of the 1 000 extra training places to be offered by CITA among different trades, Executive Director of CITA (ED/CITA) said that the extra places were allocated to trades where there were higher demand for manpower, such as metal frame erectors, bar benders and fixers.

Information on the supply of construction workers in each trade

17. Members noted that Annexes A to C of the paper provided statistics on the manpower requirements in respect of each trade for all railway projects and public works programmes, while Annex D provided the total supply of on-site workers for the construction industry, including those engaged in private projects and construction of housing flats. Miss CHAN Yuen-han considered that the Administration should establish a central data bank of construction manpower supply. DSEM said that there was no information on the supply of construction workers in each trade, as there was not a comprehensive registration system for these workers. Nevertheless, the intermediate trade test for construction workers, which was introduced in February 1998, served to provide a list of workers who had passed the test. Mr Andrew CHENG considered that the main contractors should possess records of the manpower employed under each trade. The Administration should be more proactive in gathering such information.

18. Mr Michael HO said that without the supply figures for each trade, it was impossible to assess how manpower supply was matching demand for each trade. He protested against the Administration's attitude towards the gathering of information and questioned how EMB could perform its role of matching the demand and supply of construction workers for each trade with the information available. Being responsible for policy matters on employment, the Administration should not just surrender and said that such information was not available.

19. Mr LEE Cheuk-yan shared Mr HO's view that the paper could not give an indication of how supply was matching demand. He pointed out that it should not be difficult to gather information on the manpower demand arising from construction of housing units. The annual output of public housing units had been set at 50 000 and the programme for sale of land had also been publicized. The demand arising from these should not be difficult to estimate. DSEM responded that there were difficulties in identifying the demand arising from private construction projects. The decision on whether to proceed with a private construction project was a business decision. Factors such as progress of work and types of equipment deployed would affect the manpower demand.

20. ED/CITA informed members that detailed information in respect of manpower supply in each trade was collected in a biannual survey conducted by VTC. With the information gathered in the survey, it might be possible to classify the total supply of 72 253 workers among different trades. In this connection, SS/EMB stated that the last VTC survey was conducted in March 1997. As such statistics were gathered at a different time, they had not been used in the assessment. He said that the VTC survey only covered the employed workers. It did not provide information on the distribution of unemployed workers among different trades. Information on the unemployed was gathered from the General Household Survey in which there were limitations on the identification of trades. He informed members that the latest VTC survey was conducted in March 1999 and undertook to provide members with the findings once available. Miss CHAN Yuen-han said that although VTC was conducting the survey, the Administration should take the lead to co-ordinate the gathering of such information. The Chairman suggested that the Census and Statistics Department (C&SD) should consider obtaining statistics in respect of each trade in the Quarterly Employment Survey of Construction Sites. SS/EMB undertook to reflect the view to C&SD.

Adm
Adm

21. Mr HO Sai-chu said that for many years, the Hong Kong Construction Association had called for the registration of construction workers. If there were full lists of workers for each trade, employers would be able to employ local labour as far as possible. Where shortage in supply for a particular trade was anticipated, early training of required manpower could be arranged and importation of labour would not be required. ED/CITA said that while trade tests had been introduced for construction workers, the response was not enthusiastic as participation in the tests was not compulsory. Nevertheless, he hoped that the trade tests would gradually help raise the skills level of workers. He added that the Housing Department (HD) and Works Bureau (WB) had begun to incorporate in the new works contracts the requirement for a certain percentage of workers to have passed the trade tests of CITA.

Measures to meet the anticipated increase in demand for on-site construction workers

22. Noting that the labour market for on-site construction workers was expected to tighten in 1999/2000 and 2000/2001, Mr CHAN Wing-chan was concerned that if measures were not introduced to tackle the problem at an early stage, the ultimate manpower shortage would lead to importation of labour. He urged the Administration to take early steps to address the problem so that there would not be a need to import labour. DSEM responded that a Working Group on Training and Retraining for the Construction Industry had been formed to monitor the labour supply and demand situation. The Working Group comprised representatives from trade associations, trade unions, training service providers and Government departments. It would identify the manpower requirements of different trades and gear up training services to meet the demand. He added that there were also plans for CITA to increase its training capacity by 1 000 through the temporary use of an additional training site.

23. Miss CHAN Yuen-han commented that the Administration had not learnt from the labour disputes in 1995 involving imported workers for the Airport Core Programme. An important recommendation in the report of the enquiry by the former LegCo Panel on Manpower into the incident was that EMB should have foresight. Without information on the manpower supply in respect of each trade, the Administration would be in a weak position in debating with employers on whether there was a need to import labour. She considered that there was a lack of co-ordination among different policy bureaux and departments. While the Administration was requesting employers to give priority to the employment of local workers, the Secretary for Works had recently said that the supply of on-site construction workers would be tight and therefore importation of labour would be needed. DSEM said that stringent requirements and procedures had been laid down for the importation of labour. In order to enable manpower shortage problems to be identified at an early stage, the Working Group on Training and Retraining for the Construction Industry was therefore formed.

Manpower supply from training organizations

24. Mr CHAN Wing-chan was concerned that although the output of training organizations would average around 6 000 new workers per annum, some of them might not work in the construction industry after undergoing training. Mr LEE Cheuk-yan added that as some graduates from the training organizations might be construction workers who were out of job and wished to learn the skills of another trade, the actual output of training organizations might be less than 6 000. ED/CITA said that the projected annual trainee output of about 4 400 from CITA was a figure that had taken account of the turnover rate. He added that the current turnover rate of 20% was relatively low in comparison with those of previous years. CITA had put much effort over the past few years in reducing the turnover rate. A major weakness of the current multi-level sub-contracting system was that it was difficult for graduates to gain access to sub-contractors. After a graduate was referred by CITA to a sub-contractor, he might be out of job a few months later when the sub-contractor had completed all projects, while other sub-contractors had no means of knowing such availability of manpower. To address the problem, CITA had begun monitoring the employment situation of each graduate within the first year of graduation. Referral to other sub-contractors would be made whenever necessary.

Assessment of total supply of construction workers

25. Mr LEE Cheuk-yan doubted the accuracy of the basic supply of 98 009 construction workers for 1998/99 as stated in Annex D of the paper. To his knowledge, there were only about 83 000 construction workers in 1997. He considered that as the number of on-site manual workers and the number of unemployed persons were obtained from two different surveys, there might be some overlapping between the two figures. A person who was counted as a construction worker in the former survey might be subsequently out of job and counted as an unemployed in the second survey. DSEM responded that the two figures were based on surveys conducted by C&SD in the same quarter. While there might be some overlapping between the two, the extent should be very small. Senior Statistician of Education and Manpower Bureau (SS/EMB) added that from a statistical point of view, there was also a possibility that a construction worker was not counted in both surveys. Nevertheless, the standard deviation should only be very small. As the number of on-site manual workers were obtained from on-site surveys on main contractors, there was no information on the statistics in respect of each trade. On the accuracy of the total basic supply of 98 009, he said that there were some 86 000 construction workers and 10 000 unemployed construction workers in early 1998, which totalled 96 000. This figure was close to the total of 98 009 as stated in the paper.

Skills level of CITA graduates

26. Mr James TIEN questioned whether the skills of graduates from CITA could meet the standard required in infrastructural projects and doubted whether a person could acquire all the skills required of a trade within a few months. He said that some workers were unemployed because their skills were not meeting the required standard. Although the construction cost in Hong Kong was very high, the building quality was usually below the required standard. He considered that unemployed construction workers should be provided training in their own trade. He added that if workers were more well trained in the operation of building equipment, less manpower would be required and the unemployment situation would worsen. ED/CITA said that CITA trainees who acquired the skills of a trade in a few months' time were workers who already possessed skills in another trade and wished to acquire the skills of an additional trade during the period of unemployment. Although it was increasingly difficult for a CITA graduate to find a job, about 90% of the graduates had successfully sought employment after some time. This indicated that the skills level of workers who had undergone training in CITA were accepted by employers. ED/ERB said that between January and April 1999, CITA had organized special training courses for 176 persons at the request of ERB, which had also subsidized 900 trainees to attend general courses of CITA. About 90% of the graduates had managed to find their jobs. DSEM added that the purpose of the intermediate trade test for construction workers was to provide opportunities for workers to certify their skills so as to establish an objective standard of skills level in the industry. The Chairman considered that unemployment was mainly due to a lack of vacancy rather than skills. As regards the high construction cost in Hong Kong, Miss CHAN Yuen-han considered that it was mainly due to the multi-level sub-contracting system.

V. Training and retraining strategy to meet the manpower requirements of major industries in Hong Kong
(LC Paper CB(2) 1748/98-99(05))

27. Miss CHAN Yuen-han said that the retraining and training strategies stated in the Administration's paper were too general and would not be adequate for addressing the unemployment problem, especially after the restructuring of Hong Kong economy and the financial turmoil. ED/ERB responded that ERB courses were aimed at assisting the unemployed to find jobs. ERB was working to enhance the quality of courses, establish a common assessment system and increase employers' recognition of the skills level attained by retrainees. A number of new courses had been developed to meet the needs of the community. These included courses on information technology, property management and personal care. Courses on Chinese medicine were also being jointly developed with the University of Hong Kong. ERB was developing courses on "soft skills", which covered the areas of work attitude, service culture, interpersonal communication skills and team spirit. All retrainees would be required to take the "soft skills" courses as from September or October onwards. ERB had also invited trade associations to participate in the development of new courses.

28. ED/ERB informed members that the information technology course comprised a six-week full day programme, a four-week evening programme and a three-month practical training. Computer training courses were conducted in evenings. On the employment rate of graduates from EMB, ED/ERB said that the overall rate was about 66%. While the employment rate of graduates in clerical jobs was 59%, those of graduates who worked as building attendants and domestic helpers were more than 75%, and those of graduates from courses tailored to the needs of employers were more than 82%. Miss CHAN Yuen-han considered that the Administration's policy was inadequate for tackling problems arising from the restructuring of Hong Kong's economy. Graduates from computer and information technology courses were not equipped with the necessary skills required by employers. She considered that the Administration should allocate more resources to ERB and VTC. DSEM said that VTC was repositioning its training to meet the needs of the economy by shifting from craft to technician training and updating its courses. ERB was also carrying out market research to identify the needs of the community.

29. As regards measures to improve employers' recognition of the skills level of retrainees, ED/ERB said that ERB was working to ensure the quality of courses provided. Course Steering Groups comprising representatives from training bodies had been set up to overhaul and standardize retraining programmes, and develop a common assessment system. Trade Advisory Groups involving the participation of employers and representatives from trade associations would be established to advise on the market demand for and evaluation of training programmes. A competence-based qualifications framework was being developed by EMB in conjunction with ERB and VTC. All these measures, together with the "soft skills" courses, would help increase employers' recognition of the skills level attained by retrainees. On the question of whether additional resources were needed for such improvement in services, ED/ERB said that ERB was enhancing productivity through internal redeployment of resources and manpower. Any additional resource allocated was mainly used for increasing the number of training places.

30. ED/ERB advised that under the Strategic Plan of ERB, it was proposed that the retraining courses of ERB would be made available to all the unemployed irrespective of their age and education level. This relaxation of requirements was necessary especially in view that 30% of the unemployed were aged between 20 and 29, and unemployment was no longer confined to people below a certain education level. It was also difficult to verify the education level of a participant. ERB would examine relaxing the education level of retrainees at a meeting in May. On the relaxation of age requirement, it was found that 7% of the retrainees were aged below 30 after the relaxation. ERB was reviewing the policy in this respect and the results should be available in three to six months' time.

31. Mr Andrew CHENG said that with the relaxation of requirements on age and education level, there would be an increase in the demand for retraining places. The Administration should therefore strengthen its retraining service. ED/ERB responded that the number of retraining places had already been increased from 73 000 to the current level of 95 000.

VI. Measures to improve industrial safety in the construction industry
(LC Paper CB(2) 1748/98-99(06))

32. On the number of successful prosecutions in respect of industrial safety in the construction industry, Deputy Commissioner for Labour (Occupational Safety and Health) (DC for L) said that there were 2 164 successful prosecutions in 1998 and 674 successful prosecutions in 1997. While no person was imprisoned, the total fines involved were $53 million in 1998 and $17 million in 1997. Mr Michael HO opined that the Administration should consider directly prosecuting the sub-contractors or subordinate sub-contractors who failed to observe industrial safety. DC for L said that as part of its new strategy, the Administration would prosecute more sub-contractors, nominated contractors and persons having management and control of a site for specific failures on their part to observe industrial safety. At the request of Mr Andrew CHENG, Chief Safety Officer (Operations) of Labour Department (CSO/LD) agreed to provide information on the causes for fatal accidents in the construction industry for 1996, 1997 and 1998.

Adm

33. In response to the Chairman, CSO/LD said that the longest suspension notice so far lasted 60 days. As regards the criteria for the issuance of suspension notices, DC for L informed members that the notices were issued when there was an imminent threat of serious bodily injury to the workers. Most of the cases involved working at height.

34. On the time-table for the introduction of a new regulation requiring pre-employment and periodic medical examination of workers engaged in 17 hazardous processes, Principal Assistant Secretary for Education and Manpower (Occupational Safety) advised that the Administration intended to introduce the regulation in June or July 1999. He added that the Administration had been considering the possibility of assigning a body such as CITA to co-ordinate the medical examination for workers in the construction sector.

35. In reply to Mr Michael HO's question on how construction safety could be improved, DC for L said that enforcement was an important part of the work of LD. Through increasing the number of field officers and flexible deployment of manpower, field operations had been strengthened. As there were around 1 000 active construction sites in Hong Kong and most of them were under the management and control of major construction companies, LD was concentrating its effort on these companies. On public works, LD was working closely with WB, HD and the two railway corporations to improve industrial safety through the introduction of additional safety requirements in the works contracts. The introduction of new regulations and safety promotion campaigns would also assist to improve industrial safety.

36. As regards the effectiveness of concentrating inspection on main construction companies under the present multi-level sub-contracting system, DC for L said that in view of the complex contractual relationship between the main contractors and sub-contractors, it would be more effective to enforce safety through the main contractors.

37. Members noted that in the enforcement of construction safety, LD was targeting specific companies on a watchlist. At the request of Mr Michael HO, DC for L agreed to provide information on the progress of improvement of target companies which were put on the watchlist, subject to not disclosing the names of the companies concerned. Mr LEE Cheuk-yan however considered that by disclosing the names of the companies on the watchlist, the public could monitor the safety performance of these companies. In this connection, DC for L- said that the watchlist contained companies with the highest number of accidents rather than the highest accident rates. These companies were usually the major contractors which employed a large number of workers on their sites and therefore had a higher number of accidents. To assess a company's safety performance, factors such as accident rate, independent safety audits and the report of site visits should also be considered. Disclosure of the names on the watchlist might not be fair to the companies concerned. The Administration had sought legal advice on the issue and was advised that while employers were required under the Employees Compensation Ordinance (Cap. 282) to report industrial accidents, it could not be assumed that by reporting such accidents, the employer had agreed to disclose such information to the public. As some of the cases might involve litigation, disclosure of such information would affect a fair trial in court.

Adm

38. As regards the average time spent on a construction site safety inspection, SCO/LD said that an inspection usually took 40 minutes. The frequency of visits depended on the size of a construction site and its past safety record. Mr Andrew CHENG was concerned that the small number of field officers were insufficient for carrying out a large number of inspections in a year. DC for L said that LD was flexibly deploying its field officers and, when necessary, a group of field officers would be redeployed to inspect construction sites during a safety campaign.

39. Noting that a scaffolding had recently collapsed in the Central District, Mr Andrew CHENG expressed concern about the safety of scaffoldings. He considered that the number of suspension notices issued in respect of scaffoldings was comparatively small. CSO/LD said that the safety of scaffoldings was regarded by LD as an area of particular concern. 24 suspension notices had been issued in the first quarter of 1999.

40. There being no other business, the meeting ended at 5:05 pm.

Legislative Council Secretariat
24 May 1999