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6. The Public Sector Beyond the Civil Service
- Hong Kong University Press, HKU
- Chapter
- Additional Information
6 The Public Sector Beyond the Civil Service Although public sector reform in Hong Kong has focused principally on reducing the size of the civil service, on the pay determination process and on cutting salaries, senior officials have frequently expressed the view that the public sector can benefit from greater entrepreneurialism, more private sector practices in the workplace, and more devolution of government functions to statutory bodies or subvented organisations. These are not new ideas. During the colonial administration, social policy outputs were initially mainly provided by churches and by charitable and subvented organisations. When the government became more involved in social policy, it created large statutory organisations, the Housing Authority, the Hospital Authority and the Airport Authority, to deliver services. The post-1997 administration’s continuing commitment to small government has also been based on the belief that the private sector can undertake many public functions in more efficient ways than the civil service. But the measures that have actually been taken have been relatively modest. There has not been a substantial increase in the number of public enterprises, in the corporatisation of government activities, or the sale of state assets. There are cross-cutting values at work. While the government would like to devolve some of its responsibilities, it has in practice strengthened its grip on public sector organisations because it wants to retain control of service delivery and to ensure that their strategies are consistent with central policy objectives. Many senior civil servants also believe that statutory bodies and subvented bodies are not run as efficiently as they should be. An equally important reason why greater privatisation and corporatisation of government activities has not occurred is because of political opposition. However much Tung Chee-hwa might have wanted to privatise or to devolve more government functions, there were many other fronts on which his administration was battling to win or retain support. To introduce further controversial measures would have aroused the ire of the unions, members of the Legislative Council and perhaps civil servants. For similar reasons, Donald Tsang declined to take on major new initiatives in his first term for fear of creating more political turbulence. Aside from the political context, there have also been specific objections to proposals to privatise or corporatise. The Chinese government tends to favour centralised government and was opposed 120 The Public Sector in Hong Kong to both the corporatisation of government broadcasting and the privatisation of the Airport Authority.1 Opposition to privatisation and corporatisation has also come from politicians and academic commentators who have questioned whether such measures are in fact more efficient and cost-effective than having services provided directly by the government. There has also been criticism of the lack of accountability of statutory bodies, public outcries over the large salaries paid to their senior executives, fears over job losses in the civil service, and concern over the seemingly inevitable increase in fees for public services that were once free or relatively inexpensive. Many of these concerns were raised in a debate in the Legislative Council in 1999 on the privatisation of government departments. Lee Cheuk-yan, a leading figure in the Hong Kong Confederation of Trade Unions, who introduced a motion urging the government “not to blindly believe in the effectiveness of privatisation,”2 said that he opposed … sacrificing the interests of the whole society for the sake of creating more business opportunities. I oppose the blind belief in privatisation … while ignoring the five big evils accompanying the privatisation of government services, namely a drop in service quality; heavier burden for the people as a result of loss of control on the monitoring of charges; retrogression in democracy due to dwindling accountability; adverse effects on the overall effectiveness in society arising from piecemeal implementation of government policies; and the smashing of the “rice bowls” of staff that might lead to unemployment, social unrest and suppressed wages.3 Against the “five big evils”, the then Financial Secretary, Donald Tsang, posited what perhaps might be considered as the four virtues. Corporatisation, he said, had distinct commercial advantages. The service providers could develop a customer-oriented culture. The cost-effectiveness of services could be more accurately assessed. Corporations would no longer be subject to government rules and could adjust to changing market conditions. Private sector organisations could take part in offering services previously provided by government.4 If changes were to be made, Tsang noted that staff would be consulted, redundancies would be avoided as far as possible, service...