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Ambrose Leung

The civil service chief said yesterday there were no immediate plans to bring in another round of pay cuts, amid intense speculation that government servants' salaries would be reduced to ease the budget deficit.

The pledge from Secretary for the Civil Service Joseph Wong Wing-ping came as senior officials said there was room to cut expenditure and services in the social welfare and public service sectors in order to fulfil Chief Executive Tung Chee-hwa's plan to further slash spending by $20 billion to a total of $200 billion by 2006-07.

Mr Wong dismissed rumours that the government had already prepared consent forms on salary cuts for staff to sign.

'On the recent rumours saying the government has already drafted papers on pay cuts, I hope civil servants understand that we have definitely no final decision yet on pay adjustments for next year.

'I hope we can frankly discuss how to face the deficit problems together. Any decision will only be made after consultation.'

Although Mr Wong admitted the deficit problem was a serious one, he stressed that pensions payouts for civil servants would not be affected. The deficit stood at $72.4 billion at the end of October, and a civil service pay cut of between 1.58 and 4.42 per cent was imposed that month.

Responding to threats by civil service unions that they could strike or take to the streets if another round of pay cuts was imposed, Mr Wong called for calm and said the problem would be dealt with openly and justly.

Secretary for Health and Welfare Yeoh Eng-kiong and Secretary for the Environment, Transport and Works Sarah Liao Sau-tung, both said there was room for a cut in services under their policy bureaus.

Dr Liao said although it was not easy to cut some services, her department would seek to save more by merging units which carried out different functions.

Services which were needed to meet the public's basic needs would not to be cut, she added.

Dr Yeoh said there was room for a cut in spending on social welfare. 'For example, as there are less babies being born, the number of family clinics could be cut,' he said.



Forms for another pay cut have not been drawn up, says Joseph Wong