The claim is made at the start of a challenge to the civil service pay cut Terms of contracts signed with civil servants were disregarded by the government and treated as if they had been 'written in smoke in the air,' in order to secure a pay cut last year, a court heard yesterday. Philip Dykes SC, appearing for a civil service union, made the claim at the start of a challenge to the controversial pay reduction. He also argued that the government's action was unconstitutional. Mr Dykes is representing the Government Park and Playground Keepers' Union in its fight against the Public Pay Adjustment Ordinance which took effect on July 19, last year. The union is seeking a declaration from Mr Justice Michael Hartmann, sitting in the Court of First Instance, that the pay-cut ordinance was in breach of the Basic Law - which provides that civil service conditions are to remain unchanged for 50 years after the handover. Other unions, including those representing 25,000 police officers, are waiting for the outcome of the judicial review. Mr Dykes yesterday told the court that besides breaching the mini-constitution, the union would also argue the Hong Kong government had broken the employment contracts it entered into with its 160,000 civil servants. He said contracts were essentially a compromise, with the civil servants agreeing to devote the 'whole of their time and attention to the government' at a time when Hong Kong's private sector was experiencing a golden era before the handover. When the government announced plans to introduce a bill, it reneged on its previous agreement not to impose any pay cuts, he said. 'Those principles have not been adhered to by the government,' Mr Dykes said. 'It has treated the terms of the contract as if they were written in water or in smoke in the air. The contract means nothing ... the government has not compromised.' He said the administration had pushed through the ordinance by farming out its responsibilities to the legislature and asking it to use its 'legislative muscle' to ensure the bill was passed. Mr Dykes said this move had offended the separation of powers as the executive had bypassed any possibility of a legal challenge before the bill was passed. The job of the courts should have been to settle a contract dispute between the government and its staff, in the absence of new legislation. Instead, the legislature had been asked to rewrite the contracts by passing the ordinance. Mr Dykes said the Basic Law recognised the separation of powers between the executive, legislature and judiciary. It also dictated the pay conditions and terms of civil servants' employment contracts were to remain unchanged for 50 years after the handover to ensure stable governance. While acknowledging the pay-cuts were designed to save the government $3 billion this year and $6 billion next year, Mr Dykes said: 'We say that it is in the interests of Hong Kong citizens that the rule of law be maintained even if it causes financial inconvenience to the Hong Kong government.' The judicial review continues.