March 31, 2004

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Hong Kong public servants enjoy an enviable life. Historically they have been well-paid, which some have argued has lead to the least corrupt civil service in Asia. Additionally in the days of British rule expat (read English) civil servants enjoyed great perks to compensate them for their "hardship" post. When the locally employed civil servants complained they did the only thing they could think of: they threw open the benefits to everyone.

One of those perks is the Overseas Education Allowance. This is money to pay for civil servants' children's education in the UK, all fully paid for by the Government. The civil servants do not pay a single dollar (or pound) in fees. While this ceased to be offered to civil servants starting after 1996, more than 100,000 still receive it at a cost of HK$646 million (US$83 million) at a time the Government is running a major deficit. The Government is considering imposing a cap, while the civil service unions will bleat how it is another infringement on their pay and conditions. Another proposal is to allow students to go to other countries where education is cheaper, such as Australia or Canada.

And they are 100% right. These overpaid bureaucrats receive benefits that far outweigh anything on offer in the private sector. Locally based civil servants receive a home passage allowance, even though their homes are in Hong Kong - another relic of the "catch up" with expatriate pay. There are so many absurdities in the current civil service pay structure that it boggles the mind. The Government is slowly chipping away at these benefits. However the Government can afford to be bolder. If a pampered civil servant doesn't like it, they can try and find a job in the private sector. I think they'll find it difficult to land an equivalent job with anything like the same benefits and pay. If they don't want to abolish the allowance, at a minimum they should require the civil servants to contribute a healthy percentage to the cost as a co-payment.

Civil servants, by definition, are meant to serve the public. In many countries civil service pay is lower than the private sector, partly because of the honour and power that comes with working for the Government. Hong Kong's Civil Service needs to learn the harsh realities of life without these anachronistic perks.

posted by Simon on 03.31.04 at 08:44 AM in the




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