PUBLISHED : Tuesday, 14 August, 2012, 12:00am
UPDATED : Tuesday, 14 August, 2012, 2:25am

Stop feeding a white elephant way past its sell-by date

BIO

Jake van der Kamp is a native of the Netherlands, a Canadian citizen, and a longtime Hong Kong resident. He started as a South China Morning Post business reporter in 1978, soon made a career change to investment analyst and returned to the newspaper in 1998 as a financial columnist.
 

The mission of the Hong Kong Productivity Council (HKPC) is to promote productivity excellence for industry to enhance competitiveness and sustainability through a bundle of strategies including scaling up productivity enhancement platforms, creating values (sic) for SMEs, sharpening its core competencies in business consultancy, and blah, blah, blah …
Job ad, SCMP, Aug 11

 

Yes, blah, blah, blah. The above bit of government talk was the preamble to the Productivity Council's search for an associate consultant in its materials and manufacturing technology division.

I hear you. It's what? Why does the government have a manufacturing technology division when no company in Hong Kong any longer has any such thing and just what is this Productivity Council?

Good questions indeed. The Productivity Council is a government white elephant that employs 600 people and on which we spend HK$178 million a year in subsidies to do something for manufacturing. As to what this something is, well, the Productivity Council doesn't really know itself.

I'm serious. Its introduction to itself states: "Productivity is the effective use of innovation and resources to increase the value-added content of products and services."

No, folks, that is not productivity. Increasing the value-added content of a product can be very unproductive if doing it costs you more than the extra amount the market is willing to pay you for it. Productivity is about doing it at the least possible cost and not doing it at all if it doesn't make commercial sense. In short, productivity is about getting more bang for your buck.

But trust a bureaucrat not to understand this distinction. Productivity has never been a benchmark of performance in government. The most it means is attending more meetings and turning out more memos per person.

There may have been some faint reason for a productivity council when it was set up 45 years ago. Manufacturing of simple goods seemed then to be the only way of sustaining the economy at a time of rapid population growth, and many manufacturers needed a little help in streamlining their processes.

But manufacturing is no longer a prop of this economy, except on a very residual basis. What we mean by manufacturing now is things like bottling soft drinks and turning out paper products. You hold an example in your hands.

Someone has finally got around to telling the Productivity Council about this change in our circumstances, but once a government department has been aimed it never changes its aim. It just changes its justification.

The story now is that the council keeps its focus on manufacturing in order to assist Hong Kong manufacturers who have moved their operations to the mainland.

This poses obvious questions. Why only those who have moved to mainland China? What about those who have moved to Canada? They also came from Hong Kong. Why don't we support them too?

Ah, comes the answer, but China is the Motherland. Canada is not.

Okay, but then where in the Basic Law does it say that Hong Kong is obliged to use its taxpayers' money to support manufacturers who have deserted the city for the mainland?

It is all just specious hot air, of course. The reason that the Productivity Council supports manufacturing on the mainland is that it was established to support manufacturing and therefore it must find manufacturing to support.

Its efforts haven't yet yielded much success. Despite having three separate operations in the Pearl River Delta, manufacturing is in decline there, particularly the very low-end work that characterises Hong Kong industrialists. For real manufacturing, go to the Taiwanese.

None of this surprises me. The Productivity Council's expertise lies in such things as strategy bundling of "productivity enhancement platforms" and "sharpening core competencies"; in other words, talk, talk and more talk, endless blah, blah, blah, all at your expense and of no benefit to you.

This thing is even further past its sell-by date than the Trade Development Council and that's a pretty hard benchmark to surpass.

There is only one thing to do with the Productivity Council. Kill it. If manufacturers do not rate its services highly enough to pay for them, there is no reason for government to pay for them. The only thing that continued support of this wastrel hangover from the past can do is to make us look fools. Let's get rid of it now.

jake.vanderkamp@scmp.com

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