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Response in the Motion of Thanks to the
Chief Executive's Policy Address, 22 October 1998
by Eric Li Ka-cheung


Since the Chief Executive delivered his first Policy Address, the HKSAR has experienced a notable downturn in the economy. The economic hardship, accompanied by a high unemployment rate and a sharp decline in the property and stock markets, has directly affected the livelihood of all Hong Kong people. No one would have envisaged such a scenario just a year ago.

Nevertheless, the political situation of Hong Kong has remained stable, and that is gratifying. Over the past year, our citizens enjoyed freedom of speech, freedom of assembly, and freedom of demonstrations – a lifestyle much the same as that before the reunification. In addition, the Legislative Council was elected with a record voter turnout rate. To the outside world, the transfer of sovereignty proved to be an unqualified success, and this further strengthened the status of Hong Kong as an international financial centre.


However, since the Chief Executive delivered his second Policy Speech, the media have been quite relentless in their criticism, and this has to some extent shaped and influenced public opinion. Given the difficulties we are facing now, people would of course expect a lot from the Policy Speech; if their expectations are not met, they are bound to be disappointed. The Policy Address, which did expose the Government’s limited resourcefulness and creativity, therefore triggered an outburst of emotion in the community. Our political parties lost no time to hit while the Government was down and in gaining political mileage by proposing amendments to the motion.


The Government might have been caught trying to gloss over its faults. But now that a mood of pessimism has set in, the Council cannot help our people ride out the storm by merely attacking the Government. In Carefree Wandering, Zhuang Zi says, “Here was a man who would neither feel flattered if the whole world praised him nor frustrated if the whole world censured him.” That is the attitude to take. Hong Kong still enjoys many advantages, we should stay calm, analyze the situation objectively, and accept the unavoidable economic adjustments. Honourable Members in the Council should try to be more restrained and pragmatic, and help our Government to work out a strategy for Hong Kong to turn adversities into opportunities.


Compared with the ambitious Policy Address of 1997, the Policy Speech this year is a modest one. Its keynote, “to maintain public confidence through re-adjustment”, is laudably borne out in the contents of the Speech. Looked at from the perspective of macro-economics, the Speech is particularly pertinent in conveying the following crucial messages to the business sector in Hong Kong and overseas: our Government will review the housing policy, stabilize property prices, maintain the exchange rate of the Hong Kong dollar, and foster an environment of moderate interest rates. It is also clear the Administration realizes that with the US dollar softening, the Hong Kong dollar may adjust downward. In addition, increased spending on infrastructure projects and tax concessions will all effectively contribute to our fundaments in restoring investors confidence in the medium to long term.

The Policy Address proposes to strengthen our co-operation with the Mainland and to support economic activities that have a high value-added element. In time, such activities may, along with the financial services and real estate sectors, become the main pillars of our economy, and contribute to Hong Kong’s overall economic stability and provide additional potential for future growth. Though this initiative carries an element of risk and will take time and much resources, it points to a policy objective vital to our continual success in a competitive international environment. The Council should acknowledge this reality.

As far as economic issues go, the Policy Address may have succeeded in helping us see that where there is adversity, there are opportunities, but how do we actually seize the opportunities and rise to the challenge? Are the measures proposed by the Government concrete enough? The Policy Address talks about opportunities and lofty objectives, but the action plan is vague. It gives the impression that the Government is “drawing cakes to allay hunger”, and that one is urged to “quench one’s thirst by watching the plums”. Indeed, opponents of the Government may take this as a political “opportunity” to paint a false picture of the Administration steeped in “adversity”.

In times of desperation and battered confidence, the public will naturally long for a strong and inspiring leader. Even if they are aware that there is only that much the Government can do, the people may still hope for miracles. For in the past the Government had proved time and again that their hopes were not left unanswered. Note the Metroplan. Note the New Airport Programme. What was more, while the public was still dazed by the flashy idea, the Government had already put plan into action, turned dream into reality, like a magician pulling a rabbit from his hat, miraculously salvaging people’s confidence. Right now, no such miraculous programme is in sight. That’s why the Disneyland project – just a medium-sized development programme – can ignite the public imagination. That’s why so many forgot the need for hard negotiations and openly urged the Government to snap up the “opportunity”. This is a clear indication of the public crave for “opportunities”, whether short-term or long-term.


Our civil servants are in the front-line leading the way of the people. When the times are good, officials can follow just one golden rule – be thorough in planning and avoid rash actions; in times of adversity, however, officials should be more flexible and poised ready, willing, and quick to take initiatives. There should be no dragging of the heels. Let me illustrate my point with some examples:

(1) Reducing business cost to enhance competitiveness
The Government had announced good plans in the Budget Speech to ensure that the running of a business – from registration to daily operations to liquidation – could be conducted through a set of simplified procedures and proceedings, and there were also plans for more outsourcing of services so as to enhance cost effectiveness. It is now eight months since the presentation of the Budget, the slow implementation means that many of the measures are not yet in place to help business cope with the present hardship.

Right now, few new companies are incorporated while thousands are closed, some of these companies would have a chance to survive under the proposed new legislations of provisional supervision. Liquidation cases are piling high, and an untold value of assets have been frozen for a long period of time. All these give the impression that the officials are slow, bureaucratic, and care little about the outside harsh business reality.

(2) Efforts to win foreign investment
Not only is the Government moving at a snail’s pace in creating conditions conducive to businesses, it is lacking in initiative in the formulation of an overall strategy for attracting foreign investment. There are the routine promotion campaigns such as lectures, exhibitions, publicity programmes. But that’s all.

Look at the strategies of other Asian countries. They will target major international corporations for promotion, they will send the highest ranking officials, including even their President, Vice President, or other ministers to do the lobbying work. When conducting negotiations, their Government will offer incentives such as land and tax concessions. Apart from being flexible and co-operative, the countries will specially assign officials to provide the foreign companies with all the help they need, and assist in legal and procedural formalities. In contrast, the promotion effort of the HKSAR is cavalier and leaving things to chance.

(3) Efforts to gain access to the Mainland market
The Policy Address highlights “The Challenge of Opportunities on the Mainland”, but the actual discussion is superficial.

The fact of the matter is, because of political constraints, Hong Kong’s economic development is export oriented. Our domestic market is far too small to generate internally a true economic revival. We can only look to the European and American markets and wait passively for opportunities.

But now that Hong Kong has reverted to Chinese sovereignty, we should look forward to a gradual relaxation of the heavy duties and strict quotas imposed on Hong Kong products by the Mainland authorities. At present, the Hong Kong market is completely open to Mainland products. If some reciprocal arrangements can be secured for Hong Kong products and services to enter the Mainland market, our economy will bounce back in no time. Here’s an “opportunity” right before our eyes. Will the Government be bold and imaginative enough to explore ways of seizing this opportunity?


The Policy Address tends to evade many important political problems. Certainly, the Chief Executive’s habit of playing his cards so close to his chest makes people wonder if there isn’t a dangerous undercurrent beneath the surface calm. People may wonder, too, if there isn’t a serious strain in the relations between the Executive Council, the Legislative Council, and the civil service.

I have always been proud of our civil service for its high integrity, efficiency, and esprit de corps. Lately, I am particularly impressed with the Civil Services Bureau and the Finance Bureau in urging their colleagues to face the reality and accept the need for salary and benefits re-adjustment, and in pushing ahead with the policy of streamlining efficiency, these two bureaux have shown great courage and decisiveness. Their determination to overcome obstacles and oppositions is a clear indication of the self-discipline, self-respect, and spirit of self-betterment that are still evident in the civil service. They have all my admiration and support.

“The more you care, the more demanding you will be”. Precisely because I am so proud of our civil servants, when I notice signs of slackness and complacency in an individual or two, or if they deviate from the principle of political neutrality, I will not hesitate to criticize them.

Recently, there are complaints from legislators that certain officials are arrogant and bigoted. Such behaviour is unbecoming of a civil servant on the public payroll. The Chief Executive and members of the Council, whatever one may think about them, are elected in accordance with the Basic Law, and their performance is subject to public scrutiny. The civil servants, on the other hand, receive no such constitutional mandate. However talented or capable, they are directly or indirectly employed by the Government. They can offer suggestions to the Chief Executive, but once the Government policies are made, the officials should know their place, stick to the principle of political neutrality, and devote themselves to the implementation of the policies. One of their duties is to explain Government policies to this Council and lobby for support until they can win over at least half of the legislators. Now that opinions are always divided among different political parties in the Council, it should be quite possible for the officials to accomplish their assigned task under most circumstances.


Under the existing constitutional system, civil servants should either carry out the policies of the Chief Executive or resign, they cannot insist on their own views. This does not mean that the officials cannot take any initiative, but they have to obtain the endorsement of the Chief Executive first. If the officials are allowed to ignore Government‘s pronounced policies, it is the political responsibility of the Chief Executive. This is poor management at the first level. If the officials are allowed to put forward bad policies or make blunders and get away with them, it is also the political responsibility of the Chief Executive. This is poor management at another level.


Another possible scenario is: a number of officials may collectively deviate from the principle of political neutrality, and insist on gaining the power to make policies. If the Chief Executive condones such behaviour, this will lead to a fundamental change in the system. The ministerial system proposed by some legislators, which requires officials to shoulder political responsibility for the policies they make, will then be fully justified. Otherwise, the officials will be allowed to exercise power without having to bear any responsibility, and the Chief Executive will become the “scapegoat boss”.

At present, what many citizens and legislators are complaining of is a civil service that can “do no wrong, take no blame, and receive neither reward nor punishment”. Basically there are two causes of complaint. The first is that the Chief Executive is a poor manager who doesn’t put to use a ‘stick and carrot’ approach; the second is that individual officials have deviated from the principle of political neutrality, appropriated the power to make policies, but shifted their own political responsibility to the Chief Executive and the entire civil service. The two complaints are slightly different in nature. If the Chief Executive thinks that the first is justified, he should change his management style and co-operate with the Chief Secretary to tighten his control over the officials. If the second is justified, a change in the system should be considered. Political appointments would make those who share the power share the responsibility as well. Let those who make the policies stake their political future upon them. This can ensure that stability in the system is maintained.

The Chief Executive has expressed his concern over the tense relationship between the Legislature and the Executive, but he does not seem to understand the crux of the problem. It is true that some legislators do make life unnecessarily difficult for the Administration, but the problem also lies in the attitude of the Government. Though there is public consultation, the Chief Executive and the officials always insist on their own decisions, their own superior wisdom. Any policy suggestions from the lawmakers and the public that coincide with what they think can only be 'mere coincidences'. The lawmakers and the Government are supposed to “work in unity”, but under this kind of ‘executive-led’ system, how can the lawmakers not be disheartened? In politics, it is actually not difficult to achieve good public relations. Many consummate politicians will give credit to others for ideas which are actually their own, thereby winning the hearts and souls of those who work with them. Try this on legislators whose survival depends on scoring these political points, and our officials will find a cure for all their woes. Reversing this attitude, the way forward will be full of obstacles.


Apart from political and economic matters, the Policy Address touches on many topics. It is hard to focus on every one of them. I will therefore only comment on issues concerning our young people, and the Comprehensive Social Security Assistance Scheme (CSSA).

All those who are involved in the work of youth development are delighted to see that the Government recognizes the importance of such work and projects are put into action. Some legislators have reservations about the usefulness of Government committees, but they should note how, over the past year, the Commission on Youth co-operated with important advisory committees on youth affairs, youth groups, as well as the Government, and achieved widely appreciated results.

Since the delivery of this Policy Address, I have attended a number of youth forums. Although our young people appreciate the Government’s work on youth development, they are more acutely concerned about education and unemployment. They are extremely discontented with the present predicaments and, the Government must be wary of the situation. Despite our limited terms of reference, the Commission on Youth will try its best to help.

As regards the Comprehensive Social Security Assistance Scheme (CSSA), I would like to offer the Government just one piece of advice, “Do not fire aimlessly, making much noise and fury which at the end may only bring little practical results.” There is surely a possibility of abuse amongst applicants of CSSA, but such cases are probably few and far between, and the amount involved is not likely to be material. The Government uses some isolated cases as a vague excuse to threaten the 100,000 strong needy with welfare cuts, this will only give the impression that the Government is heartless and will result in social disquiet. The CSSA dilemma is already well understood by the public, and there is clearly a need to review the existing system. But rather than simply verbalising and politicizing the issue, the Government should quietly do its home work and come up quickly with realistic proposals.


There are different ways of turning adversities into opportunities, depending on whether one is focusing on the economy or on politics. The Chief Executive has boldly and imaginatively turned our adversities into long-term economic opportunities. And yet he is criticized by members of this Council for failing to response to the immediate political adversity. Different concerns, equally valid arguments.

But there should be no arguments about the need for us “to work in unity”. The Government has evidently not satisfied the public in offering prompt solutions to their problems. If this Policy Address debate turns into yet another political variety show, is the Council any better than the Government in turning adversities into opportunities for our people? To work in unity, we need to show tolerance, broad-mindedness, and a willingness to take an overall view of things. What Hong Kong needs are not more acts of furious criticism, but far-sighted suggestions from our fellow legislators. Let us show dignity in restraint. Let us open our minds to different views in a co-operative spirit.

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