Donald Tsang

Through the revolving door

PUBLISHED : Sunday, 08 April, 2012, 12:00am
UPDATED : Sunday, 08 April, 2012, 12:00am


Related topics

The arrest by the ICAC of former chief secretary Rafael Hui Si-yan 10 days ago rocked the city's administration to its foundations and raised questions about its monitoring of public servants who take up jobs in the private sector.

Hui, chief secretary between 2005 and 2007, was arrested with Thomas Kwok Ping-kwong and Raymond Kwok Ping-luen, brothers and co-chairmen of Sun Hung Kai Properties (SHKP), one of the city's biggest landlords, for whom he worked as an external consultant.

The arrests were made as part of an unprecedented investigation into allegations of bribery and misconduct in public office.

In the past decade Hui, 64, has worked for the government, a public body and big business. He rose through the civil service ranks from 1971, starting as a junior education officer and ending his career in 2000 as secretary for financial services. After that, he headed the Mandatory Provident Fund Schemes Authority.

Before rejoining the administration in 2005, he ran his own political consultancy business and was on the board of SHKP subsidiary Kowloon Motor Bus.

His arrest has prompted questions about adherence to the guiding principle that senior officials - whether civil servants or political appointees - who leave government service should not take employment that is in conflict with the public interest or that may embarrass the government.

Under the current system the political appointees - ministers, their deputies and assistants - are required to consult a five-member Advisory Committee on Post-office Employment for Former Chief Executives and Politically Appointed Officials before accepting employment during their first year out of office, but any advice given is non-binding.

Directorate-grade civil servants are subject to stricter monitoring - a 'sanitisation period' of six to 12 months during which no paid work is allowed, followed by a 'control period' of up to two years - three years for permanent secretaries.

During the control period, they have to apply for approval from a different body, the Advisory Committee on Post-service Employment of Civil Servants, before they can take up a job in the private sector.

Both committees are headed by Moses Cheng Mo-chi, a solicitor, though the members are different.

Critics say the system is flawed. 'Political appointees are part of the public servants' system, so it is unreasonable that they are put under a more relaxed system,' said Leung Chau-ting, chief executive of the Federation of Civil Service Unions. 'The whole system should be reviewed to abolish the double standard guiding the political appointees and the civil servants.'

Former secretary for security Regina Ip Lau Suk-yee has also called the current surveillance of political appointees 'very loose'.

Civic Party legislator Ronny Tong Ka-wah notes that lawmakers have called for a revision of the rules guiding political appointees' activities after they leave government 'but the government refused to accept their recommendations'.

Others say the need for surveillance and vigilance against conflicts of interest must be balanced against the need to attract the right talent for the right job.

'Despite Rafael Hui's case, the control regime guiding political appointees has to maintain flexibility,' former civil service minister Joseph Wong Wing-ping said, referring to the so-called 'revolving door' between the private and public sectors.

The practice is widespread around the world, and includes movements between academia and the private sector, but is often a source of controversy in the United States, Britain and other parts of Europe, with legislation in place to prevent officials unfairly benefiting from their government service.

Apart from Cheng's two committees, there is no established policy on the 'revolving door' in Hong Kong.

The closest thing to it was Chief Executive Donald Tsang Yam-kuen announcement in his policy address in 2010 that senior officials could return to former careers in the private sector when their terms in the government came to an end.

'It is also understandable to place civil servants under tighter control as this is supposed to be a lifelong career,' Wong said. 'And it illustrates that political appointees are seen necessarily to have greater power than civil servants. [But] the Secretary for Development may have similar powers to the Director of Lands.'

The issue received urgent attention after the saga of Leung Chin-man, the former permanent secretary for housing who sparked heated controversy when he was appointed deputy managing director of New World China Land in 2008, only 18 months after his retirement.

As a civil servant, Leung played a key role in the cut-price sale of new harbourfront government flats to a joint venture involving New World.

As a result of the controversy, he held the New World China job for only two weeks, stepping down hours after Tsang ordered a review of the Civil Service Bureau's decision to allow him to take the position.

Leung, who had also headed the Buildings Department, was caught up in another controversy - over a bonus land grant to Henderson Land for its Grand Promenade development in Sai Wan Ho, which allowed it to earn an extra HK$3.2 billion and cost the government HK$115 million.

As a result of the Leung affair, in September the bureau imposed 30 new restrictions on post-service jobs, including setting up an online register to publish all approved applications for public scrutiny.

So Ping-chi, vice-chairman of the Senior Government Officers Association, says excessive monitoring of post-retirement employment will deter talented individuals from joining the government.

'A better way to improve it is to put stronger emphasis on moral standards in the selection of senior officials, and to impose a heavier penalty according to the law,' So said. 'If the control is too harsh, no talents would be willing to take up political appointments.'

The government has had difficulty in finding talent from within the civil service team and outside to fill ministerial seats. When former commerce chief Rita Lau Ng Wai-lan resigned in April last year for health reasons, the government appointed her deputy, Greg So Kam-leung, after a three-month search for a replacement. The delay is believed to have been the result of the failure to find a top civil servant willing to give up a permanent job for a political seat with only one year's service left.

Among the first batch of undersecretaries and political assistants appointed in 2008 were people who gave up well-paid positions, including undersecretary for home affairs Florence Hui Hiu-fai, then Standard Chartered Bank's head of business planning and development in Northeast Asia, and undersecretary for financial services and the treasury Julia Leung Fung-yee, then executive director of the Monetary Authority.

In 2009, permanent secretary for education and manpower Fanny Law Fan Chiu-fun was barred from taking a job with the charity group Tung Wah Group of Hospitals after the government ruled she could not take up education-related work until 2011 because of a potential conflict, as she had been involved in education reforms. The ban was believed to have been linked to the row over Leung Chin-man.

Supporters argued Law could have contributed immensely to the community through the Tung Wah post and that the charity group did not provide educational services for profit, so there would have been no conflict of interest. Under the existing regulations, permission is not needed if the post-service work is with non-profit-making organisations and is unpaid.

The business sector remains a popular choice for appointees.

Among notable appointments in this area, former financial secretary Antony Leung Kam-chung is now chairman for Greater China of private equity group Blackstone and former secretary for commerce and economic development Frederick Ma Si-hang became chairman and non-executive director of China Strategic Holdings more than a year after he stepped down in 2008, citing health reasons. Ma was reportedly offered HK$3.5 million a year, putting him among the city's highest-paid non-executive directors at that time.

Other controversial appointments include that of former police commissioner Tsang Yam-pui, younger brother of the chief executive, who was made an executive director of New World Service Holdings, a unit of New World Development, about six months after leaving the force in December 2003. Donald Tsang was pulled into controversy in 2007 when a Gammon-Hip Hing joint venture was picked to build the new government complex at Admiralty. Hip Hing Construction is a member of New World Service Holdings.

Patrick Chun Ping-fai, who retired as Marine Department assistant director in 2010, reportedly joined casino magnate Stanley Ho Hung-sun's Shun Tak-China Travel Ship Management before obtaining formal government approval. Chun openly criticised the administration for dragging its feet in screening his application and said he was a victim of its excessive caution in the wake of the Leung Chin-man affair.


The number of people employed in Hong Kong's civil service, figures for December show. There are 12 policy bureaus