Civil servants agree to cut pay over 2 years

After meeting representatives of the four Central Consultative Councils and four major service-wide staff unions on February 21, Secretary for the Civil Service Joseph Wong said civil servants have agreed to cut pay to 1997 levels.

The reduction will be implemented over the next two financial years, the first cut next January and the second in January 2005.

The Government will also improve the existing pay-adjustment mechanism and start the pay-trend survey.

Chief Executive Tung Chee Hwa said the consensus reached between the Government and unions on the civil-service pay cut shows the willingness of administrative staff to help resolve the fiscal deficit.

Mr Tung said the agreement underlined the strong partnership between the Government and its workforce.

He said it was conducive to maintaining civil-service morale and stability as well as to improve the efficiency of Government operations.

Mr Tung said the Government handled the issue in a fair and reasonable manner, adding that this principle would be adopted in efforts to eliminate the fiscal deficit.

The Government would also take care of the needs of various sectors of the community when solving deficit problems, he added.

Mr Wong announced the proposal after meeting  representatives of the four Central Consultative Councils and four major service-wide staff unions.

"This consensus has been reached through extensive consultation with our civil-service unions," Mr Wong said.

The Government can save up to $7 billion after the salary reduction.

The pay plan will be submitted to the Executive Council for discussion and endorsement.

The unions welcomed the proposal and hoped to keep good dialogue with the Government in the future.

Chinese Civil Servants' Union chairman Cecilia So hoped the community, including the business sector, would support the agreed proposal.

Paul Pang, Chairman of Senior Non-Expatriate Officers Association, said the Government had pledged to discuss with the staff unions the establishment of a pay-adjustment mechanism allowing both salary rises and reductions.