Following Liberals' pay cut lead would benefit the whole community

PUBLISHED : Wednesday, 07 November, 2001, 12:00am
UPDATED : Wednesday, 07 November, 2001, 12:00am

The concerns raised by your correspondents Jacon Au-yeung ('Liberal wage cuts not for all', South China Morning Post, October 31) and 'Name and Address Supplied' ('Debunking Liberal salary martyrs', Post, October 29), in response to Liberal legislators' decision to take a 10 per cent pay cut, are easily answered.

As legislators, we are paid from the public purse, and we believe that at such a testing time in the SAR's economic fortunes, it is our duty to do what we can to show leadership, and to encourage others who are paid by the taxpayer to follow suit in accepting a pay cut. Our personal investments are not relevant to this debate. They do not comprise taxpayers' money, and should not be used as an excuse to deflect attention from our main purpose, which is to relieve the pressure on government finance.

It is nonsense to suggest that bringing civil servants closer into line with private sector salaries will force pay rates down across the board. The gap between the public and private sector is already so wide that a 10 per cent cut in civil service pay will have no impact at all on the labour market, where pay scales are, in any case, decided solely by market forces.

A comparison of the salary scales of a junior typist or telephonist in government service at $12,000 and in the private sector at between $6,000 to $8,000, makes that point very clear. There are many other examples. A newly-qualified accountant working in government will receive $21,000. His opposite number in private industry starts at about $12,000. Add to this the 25 per cent annual gratuity or pension paid out to everyone in government service, and the gap between the two standards of pay becomes virtually unbridgeable.

If civil servants accepted a 10 per cent downward adjustment, as their colleagues in Singapore have done, the Government would save $16 billion per year. That would remove the need for a sales tax, or other unpopular forms of revenue raising to meet the deficit, and would thereby benefit us all.



Liberal Party