Governing Hong Kong: Administrative Officers from the Nineteenth Century to the Handover to China, 1862-1997

Chapter 8: MEETING THE CHALLENGES OF MODERNITY

139 Chapter 8 MEETING THE CHALLENGES OF MODERNITY __________________________________________________ Despite the colonial administration believing in the idea of a small government its span of control and general scope of responsibilities in fact expanded steadily in the postwar era. Part of this expansion was the result of the rapid growth of population. From 1950 to 1990, the local population increased by roughly a million every decade. The more dramatic increase happened in the earlier part of this period when the population doubled from two million in 1950 to four million in 1970. It meant the government had to increase in size just to keep up with discharging its established duties. Advancing modernity also required the Hong Kong government to take on new responsibilities and roles whatever its avowed policy. As Hong Kong evolved into a modern community its government had to assume more and more regulatory roles, be they over the banking and finance sectors or over conditions for workers in factories, or school curricula. Indeed, despite the government’s policy of not taking responsibility for social welfare, by 1970 it had already unwittingly become not only the largest local employer but also the largest provider of subsidized health services and the biggest landlord of low cost housing. By then the old structure of government was clearly under strain. When the government was much smaller the heavy concentration of power at the top worked well and efficiently. Top officials could keep track of most matters, both important policy issues and petty administrative ones; they made decisions quickly and acted decisively . With the huge expansion of the government machinery in the Governing Hong Kong 140 quarter century after the Second World War, including the proliferation of departments, the old system suffered severe strain as top administrators saw their responsibilities expanding exponentially. The axiom in administration that urgent matters always get attention before important ones proved only too real in Hong Kong.1 It stretched the capacity of the old system to its limits. By 1970 or so, it was reaching a stage when top level officials were mainly preoccupied with immediate issues and could not find time to think strategically about important policy matters or plan for a longer-term timeframe. One of the problems inherent in the system was that the principal assistant colonial secretaries at the Colonial Secretariat who on a day-to-day basis coordinated policy and administrative matters with government departments were junior in rank to heads of departments. It meant that ‘when disagreements arose, Heads of departments would insist that issues be passed upwards for decision by the Colonial Secretary or the Financial Secretary or their deputies, who consequently became overloaded, often with relatively unimportant matters.’2 Indeed, the government’s capacity to preempt problems was shown to be woefully inadequate by the riots of a few years earlier. As a result, some kind of reform or reorganization of the administration was widely seen as desirable. The introduction of the CDO scheme, examined in Chapter 6, reflected the government ’s recognition and acceptance of a need for change. The McKinsey reforms A fresh approach to reforming the colonial administration to improve governance was taken after Murray MacLehose became governor in late 1971.3 Although the idea of reform was not new, and MacLehose’s predecessor, David Trench, was willing to introduce changes, it was MacLehose who brought in a new approach. Instead of appointing a high level commission of senior or recently retired civil servants and distinguished citizens in Hong Kong, or requesting London to appoint a royal commission to review governance, as would have been the more usual practice in the colonial context, MacLehose chose to engage a modern firm of management consultants , McKinsey & Company, for this purpose. MacLehose decided to take this novel approach partly because he felt a fresh look at the administration would be good for Hong Kong, and partly because he shared the Foreign Office’s basic mistrust of Meeting the challenges of modernity 141 the colonial government, which had been nicknamed ‘the republic of Hong Kong’ during Trench’s governorship. A successful diplomat who had already served as ambassador to two countries of medium importance, MacLehose did not expect to be offered the governorship .4 When he accepted the appointment at the age of 52 it was not unreasonable for him to expect a senior ambassadorial appointment to crown his career after a five-year tour in Hong Kong...