Extending retirement age for all civil servants is fairer, and better for Hong Kong

Albert Cheng says a bigger pool of public officials will address shortage of qualified candidates for top posts, and prevent accusations of abuse

PUBLISHED : Thursday, 21 May, 2015, 3:59pm
UPDATED : Thursday, 21 May, 2015, 6:43pm

Just look around and you will see the trend. According to the World Health Organisation, Hong Kong will have the fifth-highest proportion of senior citizens in the population by 2050 among all major cities.

At present, one in eight of us is 65 or above. In 20 years, a quarter of us will fall into this bracket. The tally of elderly citizens will then top two million for the first time.

Meanwhile, our birth rate continues to decline. Five years ago, every 1,000 people in employment had to care for 172 dependents. Come 2021, the number of non-working persons to be supported will surge to 227.

The economic case to enlarge the working population is clear. In response to the challenge, the government plans to follow Western countries in pushing back the official retirement age.

The Civil Service Bureau has proposed redrawing the line from 60 to 65 for public servants. As for the disciplined forces, the recommendation is to change the mandatory retirement age of 55 to 60. Once the new arrangement is in place, public bodies and quasi-government organisations will follow suit.

The proposed scheme is, however, meant only for future recruits. Incumbent civil servants who want to stay on will be assessed by their department heads on a case-by-case basis.

Civil service unions have denounced this as divisive and discriminatory. They are worried it could lead to nepotism and other abuses of power. Police staff associations, in particular, find the proposal unpalatable. If the sensitive issue is not handled tactfully, the grievances might deteriorate into labour disputes or even strikes.

I sympathise with the civil servants. The proposal should cover all 170,000 employees already on the payroll. Equality and uniformity are the prerequisites of any fair and just personnel policy. As an employer, the government is asking for trouble in excluding serving civil servants from the benefits of an extended career.

Thanks to advances in medical science and living standards, most people are healthy and mentally alert at 60. They have the added advantage of experience and established networks. They will be forced to quit in their prime if the mandatory retirement age remains unchanged.

A more flexible policy can ease the apparent deficit of seasoned hands to fill responsible positions at the top echelons. The exodus of administrative officers, considered the cream of the civil service, has intensified under the government of Leung Chun-ying. Many have left, or are keen to leave, for greener pastures outside government. The choice to retire at 65 would act as a stabilising factor.

Secretary for the Civil Service Paul Tang Kwok-wai revealed that some 4,000 civil servants had retired every year in the five years to 2012. The average will have risen to 5,600 by the end of the following five years, then to 7,000 in the next five-year period. Pension and Mandatory Provident Fund payouts will be astronomical. The option for retirees to work half a decade longer will lessen the growing burden on the treasury.

However, once senior officials are allowed to retire later, they should face greater obligations too. The post-service control period before they can seek private employment should be lengthened accordingly, to minimise the perception and possibility of them favouring any particular interest while still in office.

The deferment of retirement is particularly important for the police force, which is suffering a shortage of experienced officers at the top. The police grade is divided into 15 ranks. An officer will have to be promoted to chief superintendent before the age of 45 in order to be considered for the post of police commissioner. That means the officer needs to climb a rung of the ladder every two or three years. That's a tall order.

Five more years of service will lead to a wider choice of well-qualified candidates.

The civil service is a cornerstone for a stable and prosperous Hong Kong. Whether and how well the notions of "one country, two systems" and a "high degree of autonomy" are implemented hinges on the quality of our civil service. A later retirement age is a pragmatic move in the right direction.

Instead of confining it to new recruits, the proposed scheme must be broadened to be effective. A line between future and incumbent civil servants is doomed to backfire.

Policymakers should be more liberal on retirement age. In fact, they can take a step further to encourage pensioners to continue to work. Some former civil servants on the old pension scheme are reluctant to work after retiring because their new salaries might not match their pension payments.

If a pensioner takes up a job that pays less than his monthly pension, the government should make up the difference. This will be beneficial to pensioners and the labour market as a whole, at no additional cost to the public purse.

Albert Cheng King-hon is a political commentator. taipan@albertcheng.hk