31 October 2005

Mr Honourable Donald Tsang Yam-kuen, GBM
Chief Executive
Office of the Chief Executive
5/F., Central Government Offices
Main Wing, Lower Albert Road
Hong Kong

I attach for your perusal my speech as prepared for delivery at the Legislative Council meeting from 26-28 October 2005 on the Motion of Thanks on your Policy Address.

I would much appreciate it if you would take note of my views on your Policy Address and give them due consideration.

With best wishes,

Ir Dr the Hon Raymond HO Chung-tai

Encl.

Remarks on the debate on
“Motion of Thanks”
at the Legislative Council meeting
26 – 28 October 2005
(prepared for delivery)

Madam President

Overall views

The maiden Policy Address of Mr Donald Tsang, our new Chief Executive, brings us new thinking and direction. He correctly affords priority to economic development. Economic development and politics are always interwoven. History tells us vividly that livelihood is the foremost in the minds of Hong Kong people. Political stability comes with economic development. However, the economic downturns in the past years have spawned lots of discontent in Hong Kong. The discord in society has further weakened our ability to make a speedy recovery from the Asian Financial Crisis as our neighbouring countries did. Simply speaking, economic development is conducive to social harmony which is the foundation of political stability.

With the change of sovereignty, Hong Kong has been sharing a closer economic relationship with Mainland provinces and cities. The 9+2 Pan-Pearl River Delta Region economic cooperation framework provides us with a solid platform for turning the region into one of the world’s strongest economic powerhouse. Instead of wasting too much energy on political wrangling, we should reset our focus on economic development. Hence, the government has the responsibility to inform the people about the economic potential of Hong Kong in the context of the Pan-Pearl River Delta Region economic cooperating framework. They should be encouraged to take the full advantage of the economic integration of the region.

Indeed, Hong Kong benefits from the CEPA and the Individual Travellers Scheme. Although some sectors like the construction industry do not feel the same level of positive effects nor does the government recognise the seriousness of the situation, these arrangements have provided Hong Kong economy with much needed economic stimulus. Moreover, the recently signed CEPA III has introduced further liberalization measures on trade in goods and services including engineering professional services. Its impact has yet to be determined.

Constitutional affairs

I welcome the expansion of the Executive Council and the Commission on Strategic Development. The inclusion of more Non-official Members in the Executive Council will allow more different voices be heard. Unfortunately, most of the newly appointed members come from the business sector. I am concerned that the lack of inputs from professional sectors will tilt the balance to the business sector. This may not be a good thing for Hong Kong. Past experience tells us that a predominance of views from a particular sector is surely a recipe for social discord.

But the Chief Executive is right to give the Chief Secretary for Administrationn and the Financial Secretary the role in policy coordination. All Secretaries of Bureaux will report to them. The lack of coordination among Secretaries of Bureaux in the past has led to duplication, confusion and ineffective policy implementation. As a result, people have simply lost confidence in them. I believe that the new arrangement will ensure higher operational efficiency and better use of public resources.

With regard to the recently released Fifth Report of the Constitutional Development Task Force, the proposal on increasing the numbers of the Election Committee from 800 at present to 1,600 is certainly a step forward. The government suggests that the proposed arrangement will enhance the representativeness of the Election Committee and with the inclusion of all members of District Council Members in the Election Committee, over 3 million voters in Hong Kong will have greater influence, though indirectly, on the selection of the Chief Executive.

With regard to the formation of the Legislative Council, the proposal on increasing the number of seats returned by the District Council Functional Constituency from 1 at present to 6 as from 2008, will surely help raise the status the of District Councils and enhance their roles and responsibilities in local affairs. This will be in line with the promise given by the government when the two municipal councils were disbanded.

Basically, I support the notion of expanding the electorate base of functional constituencies. In this connection, I am in the process of consulting my constituents on government’s proposed political reform as indicated in the 5th Report mentioned earlier as well as broadening the electorate base of the Engineering Functional Constituency to include Graduate Members and Associate Members of the Hong Kong Institution of Engineers as eligible electors.

Therefore, I cannot yet give an affirmative conclusion as to my final stand on government’s proposed political reform.

Public Service

Civil service has taken the brunt of the economic downturn in the past 7 years. Its number has reduced from over 180,000 to the current 160,000. However, the across-the-board reduction has produced a lot of adverse side-effects. Among them, staff on contract terms have been hired to meet the operation needs.

Nevertheless, such practice does not fit the requirements of some departments. Take the works departments as an example. Their projects usually take several years to complete. Continuity is an important consideration in staff deployment. However, it is doubtful if the contract staff will be stable enough.

In the past, stability had been guaranteed, as graduates would undergo a highly structured professional training programme before joining the government on permanent terms. Then they moved along the well-established career path in the government. But it has all been changed since the government has determined to reduce the size of the civil service. Graduates have to continue to work in the government as contract staff even many years after they have completed their training and obtained their professional qualifications. Hence, we cannot blame some of them for opting to leave the government for the private sector. The departure of these experienced government trained engineers who are conversant with government procedures means that government’s investment in them in the form of training and time will simply go down the drain. The non-existent career path for contract engineers has also created another problem in the department, i.e. the vital succession problem. On top of this, employment on contract basis is surely a deterrent to bright young engineers joining or staying in the government.

I understand that the government has already made some changes and offered permanent terms to some of 96 graduates working in the government. It is a good start. I hope that the government will simply resume its past recruitment practice – i.e. qualified young engineers can join the government on permanent terms after having completed its structured training programme.

I must stipulate that the government’s current practice in eliminating positions being vacant under its across-the-board reduction policy. This is an arbitrary and wasteful measure. I strongly believe that the department heads should be given the discretion according to their actual operation requirements and planning of works projects.

Mr Tsang, with its civil service background, only knows too well that a strong and dedicated civil service is one of the pillars of Hong Kong. I am sure that Mr Tsang will not let civil servants down and will strive to address their immediate problems.

Planning Lands and Works

I can only guess that the government is still sticking to its annual expenditure of $29 billion per annum on public works as no new figure is provided in the Policy Address. If the situation in the past few years was an indication, spending an average of $29 billion per annum on public works was simply not enough to lift the local construction industry from its doldrums. Though the overall employment rate has recently lowered to 5.5%, the unemployment rate of the construction sector remains double-digit.

As part of the solution, the Chief Executive should honour his election promises to dish out more public works projects and resume the 169 projects of the two defunct municipal councils. In addition, the government must ensure the provision of adequate recurrent expenditure to government departments to enable them to commence new projects. The Chief Executive must see to the early commencement of the construction of cross-border infrastructure projects that are essential to the economic integration of the Pan-Pearl River Delta Region. These include the much debated Hong Kong-Zhuhai-Macau Bridge and the Guangzhou-Shenzhen-Hong Kong Express Rail Link.

Having said that, I must give credit to Mr Tsang for re-launching some public works projects being shelved some time ago. Reactivating the building project of the Government Headquarters at the Tamar site is particularly welcomed. Indeed, this is a decision long overdue. If I remember correctly, the project has been put on hold shortly after it was approved by the Public Works Subcommittee, of which I am and was the then Chairman, in May 2003.

There are also projects being held up by the court cases on the Central and Wanchai Reclamation. Among them is the South East Kowloon Development. This Council has already agreed to scale down the project to accommodate only 240,000 people, compared with 320,000 people as proposed in the first place, in order to reduce the size of reclamation. Nevertheless, the development of the project is still not in sight. The Kai Tak site has been left vacant since the relocation of the airport to Chep Lap Kok on 6 July 1998. What a waste of our public resources!

Then we have the West Kowloon Cultural District Development (WKCD) project. Its inception can be traced back to 1998 when the government planned for a new performance venue on the West Kowloon Reclamation. Shortly after, we approved funding applications at the Public Works Subcommittee (PWSC) and the Finance Committee for 2 related infrastructure and roadworks contracts. Not long after, the PWSC and the Finance Committee were asked to approve funding for compensations to the 2 contractors because the government has overturned its early plan and decided to review the land use of the area. Government’s sway in the early stage contrasted sharply with its later insistence on the inclusion of the canopy design and the single developer approach to the development. Even the recent compromise plan proposed by the government still failed to lead to a consensus on the issue among the public.

Indeed, Hong Kong’s WKCD project has much to learn from the Abandoibarra project in Bilbao, Spain. Together with 4 other LegCo members of the Subcommittee on WKCD, I recently visited Bilbao to study the experience in the development and implementation of the project. In 15 years’time, the Abandoibarra project has turned Bilbao from a deserted ship building industrial city with up to 35% extremely high employment rate into a modern city distinguished with its culture development. The subcommittee is now preparing a second report on the findings of this visit. I hope that the officials in charge of the WKCD will lend their ears to the proposals in our reports and study the relevance of Abandoibarra project to the WKCD project.

Environmental Affairs

Despite the Chief Executive has given much emphasis on the importance of the environmental protection in his policy address, a coherent sustainable development plan with a regional cooperation framework is yet to emerge. The worsening air quality in Hong Kong needs our immediate attention. I agree with the Chief Executive’s view that we must first tackle the problem at home. But we also need to cooperate with our neighbouring regions to clean up our environment.?

Domestically, we could promote the development of renewable energy by setting achievement targets by stages. The achievement targets could be reached through the consensus of the stakeholders of our energy markets with the support of appropriate government policies. The promotion of renewable energy must be taken into account in the future development of the electricity market with the expiry of the Scheme of Control Agreements between the Government and the two power companies in 2008. The government has to come up with new tariff structures and tax incentives to bring out the full potential of energy suppliers in the future.

Meanwhile, the government must act more proactively to cooperate with our neighbouring regions with a more coherent sustainable development framework to tackle the environmental problems pertaining to not only the worsening open air quality but also indoor air quality, water quality and solid waste.

Apart from the government level, there is huge room for cooperation at the business level too. Environmental protection is a big business nowadays. Given the strength of Hong Kong companies in the international business network, we can act as a gateway for Mainland companies, who have the expertise and technological know-how in the environmental protection field, to expand into the international market or to attract foreign investment for expanding their operations.

In pursing sustainable development, Hong Kong must not act alone or just cooperate with our neighbours in a case-by-case manner. We must take a regional and broad approach to tackle the problem. At the business level, there is much potential for Hong Kong companies but government’s timely support in its policies and streamlining of government procedures are essential.

Health and Welfare Services

Our Chief Executive has a dream that Hong Kong is to be a society that cares and is fair and just. Caring for the health of its citizens is a cornerstone of a good and caring society.

I will first speak on the area of health services. Our reputable and efficient system has gained positive recognition internationally for its high quality over the years. I have no doubt that we can continue to maintain this esteemed reputation. Having endured the difficult struggles of the SARS epidemic, Hong Kong’s medical personnel dutifully and bravely performed their work to overcome the crisis. The Government has also done much to advance the control and surveillance of communicable diseases. Efforts have also started in developing Chinese medicine and clinical knowledge. Although the Government is trying hard to make health services self-sustainable and tackle the increasingly growing financial burden, the basic needs of the general public, especially the weak and elderly, should not be ignored or neglected. It is reasonable and necessary for the Government to be involved in administering our health sector. With a progressively ageing population, we can foresee health care requirements increasing. The Government’s role in this area will be crucial and vital. Without a stable medical system and a healthy population, how can we even talk of attaining a caring society? There is room for improvement as the administration studies future financial options in developing a modern and integrated multi-disciplinary health care system. In addition, more emphasis should be placed on health education and promoting sports and exercise among the general public. That is the most basic and effective way to improve public health at an elementary level.

The word “harmony” was mentioned many times in the Policy Address. In order to achieve real long-term social harmony, we must tackle issues such as finding employment for workers with low academic qualifications and skills; resolving the declining real pay of certain jobs; reaching out to a polarised middle class, the widening income gap, an ageing population, the hardships of new Mainland arrivals in adapting to new life here, and re-defining traditional family values. In terms of sustainable development in social welfare, the Government should continue its partnership with relevant sectors through the Community Investment and Inclusion Fund and the Partnership Fund, which help the disadvantaged, support various projects, and actively promote relationships with the business community, the social welfare sector and community organisations. Reaching consensus on these issues will help build social confidence and promote social responsibility among social sectors. The fact is, if we want to talk about equality in a harmonious society, we cannot leave behind those who are in the disadvantaged group.?

In particular, special care needs to be given to the elderly, the disabled and children in poverty. More and more problems will likely arise from our ageing population including greater demand for retirement housing, medical and elderly care services. In these areas, the Government should develop a community-based network so that the required services can be easily accessed. It is crucial to ensure that seniors can obtain care as and when they need it.?

The disabled also experience access problems and face high transport costs. The Government can further improve the service provided by Rehabus, as well as encourage public transport operators to give concession fares to the disabled. Hong Kong may have a free market system where companies have the freedom to conduct their business independently without political or government interference, but they also should not ignore the needs of the disabled when we talk of corporate social responsibility. Yet, instead of forcing transport operators to act, the best tactic to convince them to help the community and assist the disadvantaged is more effective persuasion. Hong Kong cannot afford to damage its positive reputation as a free business environment. In this respect, I believe the Government must keep up its policy integrity. On the other hand, the provision of enhanced support services and a barrier-free environment for the disabled should continue and expedited.

Other than the elderly and the disabled, children in poverty also require our help and special attention. It is important that equal opportunities are offered to kids from poor families or with special needs, such as those in ethnic minorities. These helpless children need the support of the community. Education is a cornerstone for them to escape poverty and boost their self-esteem. Providing equal education opportunities and appropriate support is therefore crucial. The Government has long been trying to tackle the education problem of this vulnerable group. I suggest, instead of implementing short-term band-aid measures, there should be a clear and precise long-term policy. So like a tree, these children can grow from a strong stem foundation from which they can branch out and grow. A special task committee should therefore be established to formulate a relevant policy to tackle this problem.

Furthermore, the standard of living of the working poor needs to be addressed. Due to structural problems in the economy, there are working people who still cannot earn enough to meet their basic living standard. With the gap in wealth widening in Hong Kong, it is imperative we act in response to the working poor. But the question remains as to how best to assist these families to improve their livelihood. Much discussion has been made on the ideas of maximum working hours and minimum wages. However, these have deep economic implications and they will require time to reach consensus. In the meantime, the government can explore other alternative solutions such as initiating appropriate subsidies, providing wider coverage of social security assistance, and promoting community-oriented assistance programmes to alleviate some current difficulties.?????

In general, I do support the principle of a more caring and just society, as stated in the Policy Address. It is the right direction to take and I hope the Government can achieve its goal with strong sense of urgency within these two years. There is certainly room for the administration to further extend the Comprehensive Social Security Assistance Scheme (CSSAS) to these disadvantaged citizens. For a truly harmonious society, we need to take into account the concerns of every sector and not ignore the importance of providing equal opportunities. It is my hope that government can create concrete policies towards building caring and just society, and these aspirations will not just remain nice sounding slogans.

With best regards, Madam President, I so submit. Thank you.