322 Public Administration in Southeast Asia
secretaries counseling caution and focusing on various implementation problems that they and their civil service colleagues could foresee.8
Because the political appointees were appointed on limited, non-civil service terms, they, unlike their civil service predecessors, were supposed to be held “totally” accountable for policy outcomes. These changes could both increase the power of the chief executive to control the civil service and improve the legitimacy of government by making it more accountable. Although three policy secretaries have resigned since 2002, in only one case has a policy secretary resigned to take responsibility for a policy blunder. In 2004, after widespread criticism of the government’s performance in its management of the severe acute respiratory syndrome (SARS) crisis in which 299 Hong Kong people died, Dr. Yeoh Eng-kiong, Secretary for Health, Welfare and Food, resigned from the government.
Since 2005, when a retired civil servant, Donald Tsang Yam-kuen became chief executive, retired civil servants have taken most of the top policy-making positions. By 2008, of 15 politically appointed principal officials, only four could be said to have come from outside government and one of these (Henry Tang Ying-yen) was a long-time official brought in during the colonial era and another came from the HA. With retired civil servants in charge of policy making, government has returned somewhat to the comfortable relations between politicians and bureaucrats that characterized the colonial era.
The introduction of the POAS has reduced the Administrative Service’s policy-making role and undoubtedly contributed to morale problems in the grade. Still, demand for positions in the grade remains high and competition continues to be very keen. It is likely that the reforms have increased risks and uncertainties for civil servants. The outsider-policy secretaries came from various backgrounds and were not bound by any ideology, policy platform, or party membership. They contrasted sharply with the coherence of the Administrative Service, which through selection and socialization held a relatively unified world view that subscribed to policies such as limited government, fiscal frugality, modest social welfare, low taxation, and so forth (see Lam, 2005). These risks and uncertainties have been reduced somewhat by having a majority of the post-2007 policy secretary positions in the hands of retired AOs. The reforms have also probably contributed to increased agency problems. Civil servants were less sure what the outsider-policy secretaries wanted and were probably better able to conceal information from them.
16.5 Management Tools and their Reform
The first post-1997 chief executive introduced various reforms in 1999 to cut administrative expenses and gain tighter control over the civil service. The reforms addressed adverse selection issues, performance management problems, and a compensation system that both failed to motivate and had become out of step with the external wage market. The reforms increased managerial flexibility, cut the establishment by more than 15%, and cut civil service salaries by 10% bringing them back to colonial-era levels.
16.5.1 Selection
The degree of autonomy public sector agencies have over recruitment and selection varies considerably. For tax-funded bureau-type agencies, government control of selection standards and
8 Interviews, July–September 2009.
© 2011 by Taylor and Francis Group, LLC
Civil Service System in Hong Kong 323
practices is centralized and relatively tight. The Civil Service Bureau (CSB) lays down selection rules for the hiring of professional and departmental-grade staff and directly manages the selection of key generalist grade staff, such as AOs and executive officers. The Public Service Commission, usually chaired by a retired civil servant, monitors selection and appointment processes and publishes reports on the extent to which government agencies have adhered to the rules. Within their budget ceiling, heads of departments have discretion to hire middle-level and junior staff on civil service terms and a growing number (since 1999) of “non-civil service contract staff,” the increasing reliance on which was part of recent New Public Managementinspired civil service reforms. By 2008, various government agencies had hired more than 16,000 employees on these terms, which include fi xed-term appointments, no automatic salary increments, and no possibility of promotion. The CSB has used both budgetary and administrative means to control hiring, including the imposition of general civil service hiring freezes as occurred from 1999 to 2007, when government sought to cut costs to address the government budget deficits. Despite the freeze in 2006–2007, the government recruited “on an exceptional basis” over 3000 people to middle and senior management and professional positions in the civil service. Pre-freeze hiring ranged from 10,000 to 15,000 people per year (Public Service Commission, 2006; Civil Service Bureau, 2007).9 Hiring of new employees on civil service terms resumed in 2007–2008 and the government is now somewhat less reliant on “non-civil service contract staff.”
The government selects civil servants for entry-level positions to managerial or professional posts through examinations of various kinds. Candidates first take the Common Recruitment Examination (CRE, which assesses English and Chinese language abilities and aptitude), held several times a year, and those who pass it go through a second examination (either written or by interview) tailored to the post applied for (such as the Joint AO/Executive Officer Recruitment Examination, a case-based task paper). Candidates for the Administrative Service then go through a battery of interviews and exercises following an assessment center format. By contrast, engineering graduates are selected to join a works department after passing the CRE and interviews. Less stringent selection methods, including performance tests and interviews, are used to hire Hong Kong’s dwindling public sector blue-collar workforce. Probationary appointments are a key part of the selection process. The 1999 civil service reforms lengthened the time required before a civil servant could receive a permanent position in the civil service, which enables the government to be confident of a civil servant’s abilities, potential, and intentions. Abuses of this system, such as selection based on nepotism or bribery have been very rare (see Burns, 2004).
In the absence of performance-based pay, arguably the incentive for civil servants in Hong Kong to work hard is promotion and in 2006 more than 1,100 civil servants were promoted to middle and senior management and professional positions out of a total of some 33,000 or so positions in this range (Public Service Commission, 2006). Promotion opportunities are relatively few and highly sought after, in part because most civil servants have already reached the top of their current rank pay ladder. Generally, departments and grades convene postings and promotion boards to arrange acting appointments, thus giving management an opportunity to observe the performance of a candidate working at a higher level, and then recommending him or her for promotion. Although postings and promotion boards consider performance appraisal reports to some extent for these exercises, generally for a variety of reasons (such as widespread over-grading in appraisals and the high value placed on seniority in the Hong Kong civil service)
9During the freeze, the government hired about 16,000 new employees on “non-civil service contract” terms of service. That is new hiring continued, but not on the expensive civil service terms.
©2011 by Taylor and Francis Group, LLC
324 Public Administration in Southeast Asia
they make promotion decisions based largely on seniority (Burns, 2004). Thus, in a 1999 survey of the Administrative Service and the directorate, only about one-third of AO respondents agreed that civil service postings (the critically important acting appointments that generally precede promotion and give the government an opportunity to assess performance at a higher level) were based on merit. Less than half (46%) of AO respondents agreed that promotion procedures in the Administrative Service were fair, perhaps reflecting the desire of many AOs for a more perfor- mance-based system of promotions (Burns, 2004, 130).
Competition between generalists and specialists for promotion to head of department outside the AO-dominated policy-making bureaus has sometimes been intense. Indeed, from time to time, the government has chosen AOs to head such technical agencies as Customs and Excise, Environmental Protection, Buildings, Marine, and so forth. In some cases, AOs have been installed where feuding professional grades could not work together (e.g., engineers and building surveyors in the Buildings Department) and in other cases AOs have been selected to improve policy coordination (e.g., merging the position of director of environmental protection, a post usually held by a member of the environmental protection officer grade, with the post of permanent secretary, held by an AO, after an Environmental Protection Department-sponsored environmental impact study opposed the former state-owned KCRC from extending its rail line through an ecologically sensitive valley). In these cases, staff associations representing the professional grades bitterly contested the reduction in their promotion prospects, which these moves apparently entailed. The government’s view is that professional or departmental grade officers should compete with AOs to head professional departments under the policy of an “open directorate.” In practice, the “open directorate” policy has allowed AOs to take over and manage many professional departments.
Hybrids and state-owned enterprises among Hong Kong’s public sector have much more discretion to set standards and design and implement their own hiring procedures. For statutory bodies this discretion is laid down in law. Although they may use examinations of various kinds, hybrids set their own selection criteria and processes. They also have discretion to make lateral appointments from outside the organization at mid-career or senior levels, a practice that is not common within government agencies.
Selection of senior officials of hybrid organizations has occasionally aroused controversy mainly because government officials felt that the hybrid had too much autonomy and was not sufficiently supportive of government policy. In 2003, the government refused to renew the contract of Anna Wu Hung-yuk, then head of the Equal Opportunities Commission (EOC), after a series of run-ins with the EOC under her leadership on policies that discriminated against girls in the assignment of school places (the EOC sued the government over this and won) and on the EOC’s recommendation to implement a policy of “equal pay for work of equal value” within parts of the civil service, a recommendation strongly contested by government. In another case in 2006, the government sought the removal of the acting chief executive of the former KCRC, Samuel Lai Man-hay, for organizing a “show of force” to oppose the government-appointed chairman of the corporation. Cases of the government intervening in the recruitment and selection of officials of public sector hybrids have been rare, however. Generally, selection has been supervised by boards on which the government has some representation.
16.5.2 Performance Management
Since 1999, government has somewhat decentralized the management of performance in Hong Kong’s tax-financed government agencies to heads of departments. Adopting a New Public Management perspective, government outsourced many previously centrally provided training
© 2011 by Taylor and Francis Group, LLC
Civil Service System in Hong Kong 325
activities to the private sector and local and overseas universities and emphasized that civil servants should take responsibility for their own training and development. Government has invested in management training for various general grades, such as AOs. For this grade, apart from induction training, seminars, and part-time training programs, officers have the opportunity to study in Beijing and overseas, and small numbers are provided with secondments to the private sector. Nevertheless, after the reform, departments and agencies continued to deliver most vocational training (e.g., that delivered by police and other disciplined services training schools).
The CSB encourages departments to improve their individual performance appraisal systems, which continue to be top-down; neither co-workers, subordinates, clients, nor customers are involved in these annual exercises. Although official training materials seem to endorse MBOtype appraisal processes that involve collaboratively setting objectives and mid-term reviews, in practice, appraisals are dominated by supervisors who, by virtue of their position, have the authority to recommend their subordinates for promotion. Higher-level officials endorse the appraisals, but may not even know the employees concerned. Over-grading is a serious problem. As an officer in the Customs and Excise Department observed, recognizing the importance of good co-worker relations: “In order to maintain a harmonious relationship with subordinates, we prefer to give an outstanding (appraisal) report to officers in the ‘promotion zone’.” “Don’t forget that in the Department avoiding trouble is always the main concern of all managers. So, why not just give [them] an outstanding report? It will do us both good” (Burns, 2004, 241). To improve the accuracy of appraisals, departments have adopted forced choice methods (e.g., permitting only 20% to be evaluated as “outstanding” or “very impressive”) and “appraisal committees” composed of a group of supervisors who compare and moderate appraisal results across various managers. These developments have probably gone furthest in the engineering grades within the civil service and may have improved the accuracy of appraisals. Nevertheless, they apparently have not prevented practices that reward seniority and involve over-grading senior officials in “promotion zones” of some grades and departments, e.g., the Housing Department (see Burns, 2004, 244). In 1999, the CSB also set up new mechanisms to streamline the handling of discipline cases (they are now centralized in a secretariat within the CSB, a move that has reduced the time taken to handle routine cases). The CSB also laid down centrally mandated procedures to manage under-performers. The policy requires supervisors to advise under-performing colleagues of their problem and help them to improve through “supervision, counseling, training, posting or other appropriate administrative efforts,” which might include stoppage or deferment of annual increments of pay (see Burns, 2004, 253). Poor performing civil servants are featured in the regular reports of the Audit Commission, indicating that these softer methods may not be effective. Yet each year, small numbers of civil servants (less than 10) are dismissed for “persistent poor performance.”
Hong Kong’s civil service system’s relative emphasis on competition and on post hoc monitoring and supervision, including effective anti-corruption measures, has probably reduced moral hazard to some degree (see Horn, 1995). Yet problems remain. As we have seen, promotion within the civil service is mostly seniority based. Moreover, monitoring some kinds of government work remains notoriously difficult. Audit Commission reports have repeatedly criticized the failure of various government departments to control the behavior of outdoor workers (see Audit Commission Report No. 37, October 2001; Burns, 2004). Further, organization cultures in other departments have encouraged staff to break the rules as well. Radio Television Hong Kong (RTHK), a tax-financed bureau employing individuals in the performing arts on civil service contracts, has run afoul of the rules on numerous occasions (on procurement, hiring of film crews, and the like), even leading to the conviction of some RTHK staff for various offenses and to the resignation of the head of department (see also Audit Commission Report No. 37, October 2001).
© 2011 by Taylor and Francis Group, LLC