SCMP Tuesday, October 9, 2001

Civil service still too big


Cutting government operating expenses is a central issue in managing our deficit problem, as many in the business community believe civil service reform has not gone fast or far enough.
As the Chief Executive recognised in last year's Policy Address, the reform of the role and functions of the civil service ought to be a "work in progress", not a finished product. As he said then, "to keep abreast of social advances, our civil service needs continuous improvements as well". Occasionally there is a need for a thorough re-think, a re-assessment of its structure and its services. It is all part of the process of re-inventing government, ensuring its institutions and activities are relevant to the times and the people it serves.
In Hong Kong, this process of the re-invention of government now also involves consideration of how to make the administration more accountable and responsible at its highest levels, including the much-discussed "ministerial system". Hopefully, more may be heard in tomorrow's Policy Address.
Meanwhile, reform of the civil service at the functional level needs to be vigorously pursued. Few in Hong Kong doubt that the SAR has a fine civil service dedicated to serving its constituents. Most, too, are appreciative of its "clean, ethical and professional" reputation. This is also a quality that distinguishes Hong Kong as an international city of China and attracts multinationals to use Hong Kong as a gateway to China. The challenge is maintaining and enhancing our reputation.
Increasingly, Hong Kong people are demanding from their government clearer policy objectives, greater accountability and transparency, more efficient and affordable use of public resources, improved services and better results. They want greater responsiveness. Many are also rightly concerned about the increasing cost of government and the fact that public expenditure has now risen to more than 20 per cent of Gross Domestic Product. Put simply, that means that one-in-every-five dollars of the SAR's output is now accounted for by government spending. Not long ago it was one-in-six.
Partly in response to this public demand for change, the Government has undertaken some action, including outsourcing, corporatisation and privatisation programmes. It has also initiated an Enhanced Productivity Programme for civil servants, and sought to modernise management. And it intends to look at a much-needed performance-based rewards system and a provident fund scheme for new recruits.
Sadly, there are signs the momentum of reform might be slowing rather than picking up. For various reasons, some of the policy initiatives have been held up in their early stages or not implemented thoroughly when announced. As a result, greater administrative efficiency in government is sacrificed and we still have a 180,000-strong civil service with salaries accounting for almost 60 per cent of the Government's budget. This is big government, not small.
There is clearly much more that could be done in terms of reform at all levels and in all its aspects. There are basically six questions that need to be addressed and answered: What services should government provide?; How widely does it need to provide them?; What funding is required to ensure they are provided?; Is the civil service working as efficiently and effectively as it might in the provision of these services?; How might the civil service be better structured to provide them?; And what remuneration and benefits should be paid to those who provide them?
Real reform of the civil service also requires a change in the philosophy, culture and attitudes of those within the service and those responsible for it. There needs to be an objective assessment of what services absolutely have to be provided by the Government and what can be done by the private sector. And there needs to be a greater flexibility in attitudes and in movements of services and people between the public and private sectors.
Many in the business community want to see a continuing review of services provided by all levels of government. Let's have a good look at which of them really needs to come directly from government and which can be outsourced to the private sector. This would enable the Government to concentrate resources on areas where its involvement is absolutely necessary.
Bottlenecks in the whole process need to be reduced, whether they come from lack of decisive action at the top, opposition within the civil service itself, or from legislative hold-ups. We have seen examples of all three in the past and they continue to this day.
Take the example of the Survey and Mapping Office within the Lands Department, a target for the relatively modest step of corporatisation for more than a year. Even this modest move towards somewhat greater independence and accountability for one small division of government is still being held up.
The consultation process that ensued since the proposal for such a move was first mooted is now approaching its 16th month. This is despite a consultancy study that concluded corporatisation was a viable option and repeated assurances that the new arrangement would have little impact, if any, on existing government staff.
Changing something as large and complex as the public service is a monumental task, but if our civil service is to meet the new expectations of the public, change continues to be required. The service's underlying foundations are solid - they are grounded in the rule of law and in the integrity, objectivity and honesty of the service itself. However, the Government and its workforce will have to undergo a major change in mindset.
Christopher Cheng is the chairman of the Hong Kong General Chamber of Commerce.