Chapter 14

Public Ethics and

Corruption in Hong Kong

Public service ethics is concerned with ways in which officials comply with formally expressed government and community norms and values and with the extent to which those norms and values adequately reflect how the community believes that public servants should perform their duties. Attempts to ensure compliance may involve sanctions, such as penalties proscribed by government regulations and anti-corruption laws; incentives, such as generous salaries to mitigate the possibilities of corruption; and moral suasion, aimed at inculcating appropriate values into the work and attitudes of public officials.

In Hong Kong, for the last 30 years, public service ethics have been dominated by the anticorruption laws and by regulations and practices derived from them. So assiduously have the laws been enforced by the Independent Commission Against Corruption (ICAC) that they have become a critical component of both the administrative culture of the civil service and the way that citizens view their government. Surveys show that the ICAC is trusted more than any other political institution or organization in Hong Kong [1]. As a result of its efforts and the commitment of senior officials to clean government, corruption levels have been significantly reduced. In Transparency International’s 2008 corruption perception indices, Hong Kong stood 12th in the world, second only to Singapore in Asia and six places ahead of the United States [2].

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Public service ethics, however, has a wider compass than simply ensuring that officials act within the provisions of the anti-corruption laws. For example, it would be quite possible for officials to be both incorruptible and lacking in responsiveness to public needs or in accountability for their actions. To assess how the Hong Kong government has performed in this wider context, we will consider the core values that it has formally endorsed and then analyze the extent to which they have been instilled in the behavior of civil servants.

In 1998, the then head of the civil service, Anson Chan On-sang, said that the core values of the civil service were: commitment to the rule of law; honesty and integrity above private interests; accountability and openness in decision making; political neutrality; impartiality in the execution of public functions; and dedication and diligence in serving the community [3]. For the purposes of our assessment, we may compress the core values into three categories: honesty, integrity, and adherence to the law; accountability, openness, and political neutrality; and impartiality and service to the community.

14.1 Honesty, Integrity, and Adherence to the Law

Perhaps the broadest general rule governing the ethical behavior of Hong Kong civil servants is that they should obey the law. The colonial Hong Kong government placed great emphasis on the rule of law and implicitly used it as a distinguishing characteristic from governments elsewhere, notably in China. By the 1990s, when the transfer of power to the People’s Republic was imminent, many believed that the maintenance and protection of the rule of law was the key to a successful transition [4]. Its inclusion as a core value of the civil service thus reflects both its long-standing importance within the government and its relevance to the community. In a government that is highly rule-oriented, the law is the first point of reference when civil servants make decisions and the first line of defense when they are criticized for those decisions. Anti-corruption measures fit well within this framework and have been carefully observed by most civil servants since their adoption in the 1970s.

The story of Hong Kong’s fight against corruption has been told many times and need only be recounted briefly here [5]. In 1966, there were riots in which police corruption was probably an underlying cause [6]. In the following year, further riots resulted from a spillover of the Cultural Revolution. The disturbances represented a serious threat to the legitimacy of the government and major steps were taken to reduce the gap between government and the people, to improve the labor laws, to expand social policy outputs, and to combat corruption.

In 1970, the government introduced new legislation, the Prevention of Bribery Ordinance (POBO) (Cap 201), which significantly strengthened the penalties against corruption and improved the chances of apprehending the guilty. Two critical sections of the ordinance were directed specifically at public servants. Section 4 provides that a public servant who solicits or accepts an advantage is guilty of an offence and is liable for a maximum fine of HK$500,000 and imprisonment for 7 years and is required to pay back the proceeds of corruption (POBO, S.4 and S.12). The government did not use “corruption” in the ordinance, preferring instead the word “advantage,” which could be interpreted more precisely and which could be applied to relatives who accepted benefits on behalf of the corrupt officer [7]. Section 10 illustrates the government’s intention to cast the net widely. It provides that any former or serving officer who has a standard of living or possesses or controls assets that are not commensurate with his official emoluments is guilty of an offence and is liable to a fine of HK$1 million, 10 years’ imprisonment, and is required to pay back the unexplained assets (POBO, S.10 and S.12).

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In June 1973, the attorney-general charged a senior police officer, Peter Godber, under Section 10 of the POBO. Godber was found to have assets worth six times his total earnings since joining the police force. He then managed to escape from Hong Kong, causing a public outcry, but was eventually extradited from Britain, tried and convicted. The government, meanwhile, set up an investigation into the circumstances that had enabled Godber to leave Hong Kong, and into the effectiveness of the POBO. Blair-Kerr, the high court judge who conducted the investigation, recommended some tightening of the ordinance and noted that corruption still seemed endemic in the police force and in seven other major government departments and that the public had little confidence in the ability of the police force to conduct corruption investigations impartially [8].

The governor decided to create an independent body and the ICAC began work in February 1974 armed with what have been described as “extraordinary” powers, including the right to arrest, to detain, to search premises without prior court approval, and to freeze the assets of a person under investigation who has not yet been charged [9]. It enjoyed wide support from the community notwithstanding some concern in both the courts and the legislature that its formidable powers might be abused. The ICAC’s initial focus was primarily on public sector corruption, especially “syndicated” corruption in the police force. So vigorously did it pursue its task that in 1977, junior police officers attempted to storm the ICAC building. The governor granted them an amnesty although, over the next 2 years, most of them were dismissed from the force. It took some time for the ICAC to recover public confidence after the amnesty. By the 1980s, however, it was again heading the push for clean government in Hong Kong. Increasingly, it was perceived to be an institution for redress: a large number of the complaints that it received had nothing to do with corruption.

The ICAC is organized into three major divisions: the Operations Department, the Community Relations Department, and the Corruption Prevention Department with an administrative support section. At the end of 2008, it had an establishment of 1376 and an actual strength of 1263, comprising 936 in the Operations Department, 157 in Community Relations, 53 in Corruption Prevention, and 117 in administrative support [10]. It is some indication of the ICAC’s standing in the community that the government, despite a cost-cutting exercise that saw the total civil service establishment downsized from 189,139 to 163,637 between 1997 and 2009, did not reduce the ICAC’s budget. Its establishment, although not its actual strength, actually increased by over 100 between 1997 and 2008 [11].

In 2008, the ICAC received 3377 reports of corruption, 65% relating to the private sector. There has been a decline in the number of corruption reports about the civil service in recent years. Of the 35% of complaints about the public sector, 22% related to the police force [12]. Of those convicted of corruption offences, only 3 came from government departments, although a further 105 public servants were referred by the ICAC to the secretary for the civil service or to heads of departments for disciplinary action [13].

The corruption reports and conviction statistics do not entirely reflect the influence of the ICAC on Hong Kong life or its considerable impact on the administrative culture of public servants. A few examples may serve to illustrate the extent of that influence. In 2008, the ICAC’s Community Relations Department ran integrity training seminars for 21,076 civil servants from 78 government departments and 165 preventative education seminars for managerial and frontline staff of public bodies [14]. It was involved in a range of conferences and meetings with private sector organizations and it helped to organize community events that were estimated to have reached 400,000 people [15]. It also seeks to pass on the anti-corruption message to youth and to reinforce the message in the media in frequent campaigns, which include television advertisements.

The ICAC’s Corruption Prevention Department takes on assignments from government departments and businesses, which fear that new initiatives or changed circumstances might result

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in more opportunities for corrupt behavior. It has a very wide remit. In 2008, for example, its 88 assignments ranged inter alia from the investigation of practices relating to the provision of school lunches, to the administration of markets, to the declaration of income and assets by public housing tenants, to issues concerned with good governance in public bodies outside the civil service [16]. Another function of the ICAC is to investigate complaints against electoral procedures and to run publicity campaigns to support clean elections. In 2008, it received 753 election complaints and prosecuted 24 people for improper procedures and corruption [17].

For public servants, the role of the ICAC—and what it means to accept an advantage—is one of the first lessons learned after joining the government. It is a message that is reinforced at various stages during the public servant’s career. The two principal booklets explaining what constitutes proper and ethical behavior—Civil Servants Guide to Good Practices and Ethical Leadership in Action: Handbook for Senior Managers in the Civil Service—were both produced with considerable input from the ICAC [18]. In both documents, the text goes into considerable detail about what it means to accept an advantage—whether a “red packet” at Chinese New Year may be accepted, whether the loan of a car is an advantage, whether taking part in a raffle may compromise official integrity, and so on. Senior managers are advised on how the threat of corruption and malpractice can be minimized and they are provided with checklists on how they might identify corruption in the workplace and take action to stop it [19].

The anti-corruption measures dominate the ethical agenda to the extent that other issues are over-shadowed and not perhaps explained as fully as they might be. A civil servant reading the guide to good practice would be well versed in the anti-corruption laws, but might be less certain of the exact meaning of such phrases as “discharging official duties in an accountable and fair manner” or “bringing the government into disrepute.” It is difficult for a civil servant to be aware of all the regulations that govern behavior because they are not only contained in the “good practice” and “ethical management” booklets that the government distributes to civil servants, but also in the voluminous civil service regulations and in the circulars that the Civil Service Bureau issues from time to time [20].

From early colonial days, the purpose of the regulations has been to ensure top-down, centralized control with the objective of maintaining an honest, impartial, and fair civil service in which private interests should not conflict with public duties [21]. The regulations permit the government to take disciplinary or legal action against civil servants on a variety of different, often ill-defined, grounds. When it does so, the result is often to arouse political and public interest in the ethical issues involved. Three cases may serve to illustrate how the government seeks to deal with the consequences of ethical debates on its use of these broad powers.

Sin Kam-wah, then a senior superintendent in the Organized Crime and Triad Bureau of the police force, while off-duty, received sexual services from prostitutes provided by a businesswoman who had financial interests in a number of nightclubs. Sin did not pay the prostitutes. Presumably because it might have been difficult to prove that an advantage had been received, Sin was not charged under the provisions of the POBO, but with the common law offence of misconduct in public office. The defense claimed that, since Sin was off-duty and that no advantage had been received, no offence had been committed. In December 2003, the District Court nonetheless convicted Sin and sentenced him and the businesswoman to 3 years’ imprisonment [22]. On appeal to Hong Kong’s highest court, the Court of Final Appeal, the conviction was upheld, the court noting that the police ordinance stipulated that a police officer was always on-duty if the circumstances required him to exercise his powers and that, although no immediate advantage was received by the businesswoman, there could well have been future advantages for the clubs in which she had a financial interest [23].

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The case aroused considerable public interest and the Civil Service Bureau possibly felt that it owed civil servants some explanation of what constituted “misconduct in office” in its guide to good practice. However, the explanation, using a Court of Final Appeal judgment, only serves to confirm that it is deliberately vaguely worded and may be used in many different situations [24]. The offence may have specific legal meaning under Hong Kong law, but there is no certainty of the circumstances under which the government will or will not prosecute.

Conflict of interest in post-public employment is another issue of perennial concern to the government and to the public. The government’s official position is that “[r]etired civil servants should act with good sense and propriety in pursuing post-service employment …and avoid engaging themselves in activities which could be construed as being in conflict with their previous duties [25].” In the 1990s, a number of potential conflicts of interest in post-service employment made the government conscious of the need for regulation. But it remained light regulation and almost every application from civil servants to take up post-service employment was approved.

In December 2004, a legislative councillor asked the government about the alleged lobbying activities of a former senior civil servant, Ms Elaine Chung. On retirement, Ms Chung had been granted permission to take up a business position and had indicated the areas of the business in which she would be working. The company was associated with a larger conglomerate, the Henderson Land Development Company, which was bidding for multi-million dollar government contracts. Ms Chung was alleged to have assisted in the company’s promotions for those contracts, drawing on her experience as a senior civil servant. The Civil Service Bureau had not been aware that Ms Chung might engage in promotional activities for Henderson. Ms Chung vigorously defended her actions, pointing out that her relevant government experience was long out-dated. The Civil Service Bureau eventually agreed that there was no conflict of interest, but warned her not to engage in lobbying activities in the future [26].

In the meantime, the government came under considerable pressure from legislators to tighten its regulations on post-service employment. They passed a motion calling on the secretary for the civil service to apologise for his handling of the Chung case and to amend the rules in various ways to ensure that potential conflicts of interest could not occur in the future [27]. At first, it seemed as though the government would comply with their demands. However, the civil service unions were adamantly opposed to what they saw as a threat to their right to work after leaving the government. When the new regulations were put before the Legislative Council later in the year, some cosmetic refinements had been made but there were no major changes to the existing rules.

A further high-profile case in August 2008 saw the issue of post-service employment reach the headlines once more. A former director of housing, Leung Chin-man, was alleged to have been involved in a conflict of interest when he joined a company that had undertaken property development for the government while he was still in office. There was considerable public concern over the issue and Leung soon resigned from the company. The chief executive responded by setting up a committee to consider further the rules governing post-service employment [28]. In 2009, the committee produced a report that contained recommendations which refined the regulations and proposed measures aimed at enhancing awareness among civil servants of potential conflicts of interest [29].

In essence, then, the regulatory ethics governing the relationship between the government and its civil servants falls into two categories: there are, first, precise anti-corruption laws, backed by detailed explanations of the law and a well-respected and competent enforcer, the ICAC, and, second, a variety of provisions in the civil service regulations, the common law, and Civil Service Bureau circulars, which are deliberately imprecise or platitudinous or come up for more detailed consideration only when specific events cause public concern. By default, the moral agenda of the

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