CHAPTER 4

CIVIL SERVICE STARTING SALARIES REVIEW

4.1        On 23 October 1998, the Commission was invited by the Government to undertake the Civil Service Starting Salaries Review. The letter from the Secretary for the Civil Service (SCS) to the Commission Chairman is at Appendix I.

4.2        As set out in the terms of reference attached to the SCS' letter of 23 October to the Commission, the review is confined to starting salaries and qualification benchmarks. It also prescribes that the Commission is to proceed with the review on the basis of the civil service pay policy currently in force. This is different from the last two reviews conducted by the Commission in 1979 and 1989 respectively where the Commission was required to undertake a comprehensive review of all aspects of civil service pay and conditions of service.

4.3        The Commission accepted the invitation on 5 November 1998 and set up a Steering Group to oversee its implementation. At the request of the Administration, the Standing Committee on Disciplined Services Salaries and Conditions of Service is also represented on the Steering Group in view of possible implications on the Disciplined Services. The membership list of the Steering Group is at Appendix J.

4.4        The Steering Group met on 11 November 1998 to consider, amongst other things, the survey methodology and consultation with major civil service unions and interested private sector organisations. On methodology, the Steering Group agreed that the "Educational Qualification Method" (EQM) which was used in 1979 and again in the 1989 review should be adopted for the current review. The Steering Group took into account that for the past twenty years, the civil service pay structure was developed on this basis and accepted by both the civil servants and the public. Therefore, there was no reason to change the methodology in the forthcoming survey. Consideration was given to the application of other methods such as the core grade and the grade-by-grade factor analysis methods. But the Steering Group finally decided that the EQM should be used having regard to the objective of making broad rather than precise comparison of starting salaries between the private sector and the civil service.

4.5        The Steering Group met with the Staff Sides of the four central consultative councils and representatives of three major civil service unions from 25 - 27 November 1998 for an exchange of views on the survey methodology. Informal discussions were held between the Commission Secretariat and the Institute of Human Resource Management and the Employers' Federation on 20 and 27 November 1998 respectively.

4.6        It is clear that the Staff Sides were full of apprehensions about the review. They were concerned that any review undertaken before the economic situation in Hong Kong became more stabilised would result in a reduction of civil service pay. They were assured by the Steering Group that the Commission had no preconceived ideas about the outcome of the review and would reflect their concerns to the Administration and the Commission for consideration.

4.7        The Staff Sides of the four central consultative councils also asked for a meeting with the Commission which took place on 9 December 1998 at which they requested, amongst other things, that the review be deferred for 3 months to give them more time for consultation with their constituent unions; the scope of the review be expanded to include a comprehensive review of individual grades; and that the survey methodology be modified to take account of factors pertaining to individual jobs.

4.8        Prior to their meeting with the Commission, they also met the SCS on 4 December 1998 at which the SCS reaffirmed that the timing of the review would not be changed and that the scope of the review would be confined to starting salaries only. Whether the review would lead on to reviews of other aspects concerning civil service salaries would be a matter the Administration would have to decide in the light of the findings of the starting salaries review and the Commission's recommendations on how to take these forward.

4.9        The Staff Sides' representations were given careful consideration by the Commission at the meeting on 10 December 1998. The Commission's views on the salient points raised by the Staff Sides were conveyed to the representatives of the respective councils/unions by the Convenor of the Steering Group on 17 December 1998 (vide letters at Appendix K).

4.10    Formal invitations to private companies which have agreed in principle to participate in the survey were issued before end of December 1998. The survey would commence in January 1999 as scheduled.