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(From left) Former Hong Kong chief executives Leung Chun-ying and his predecessors Tung Chee-hwa and Donald Tsang. Photo: Dickson Lee

‘Gross mismanagement’ by Hong Kong’s four chief executives led to present city woes, author and ex-colonial policy adviser Leo Goodstadt says

Economist blasts city’s post-1997 leaders in new book, calling Tung Chee-hwa ‘a failure’, Donald Tsang business-minded, Leung Chun-ying ‘miscalculating’ and Carrie Lam unimpressive

Carrie Lam

The “gross mismanagement” of Hong Kong by the city’s four chief executives to date has resulted in the current problems faced by residents – from the housing shortage to a flawed education system and political uncertainty – according to a former chief policy adviser to the last two colonial governors.

The scathing comments by economist Leo Goodstadt are reflected in his new book, titled A City Mismanaged: Hong Kong’s Struggle For Survival .

Leo Goodstadt was chief policy adviser to the Hong Kong government from 1989 to 1997. Photo: Dickson Lee

The author argues the city’s post-1997 leaders emulated private sector models in public administration and imposed unnecessarily tight control over the provision of public services.

Goodstadt came to Hong Kong in 1962 and served as the first head of the government-appointed Central Policy Unit from 1989 to 1997. He told the Post in a recent interview: “Gross mismanagement in government is not caused by Hong Kong’s political system but by the incompetent performance of the individual power holders.”

Bad government policy worsens poverty, says ex-adviser Goodstadt

The mismanagement, Goodstadt said, had led to current woes in the city, such as the housing shortage, overcrowding in public hospitals and ineffective ­handling of relations with the ­central government.

Goodstadt, in the interview, questioned the political skills of current leader Carrie Lam Cheng Yuet-ngor and said her administrative performance was unimpressive, with her insistence on the profit-driven business model of governance.
Hong Kong Chief Executive Carrie Lam. Photo: K.Y. Cheng
In his book, Goodstadt said Tung Chee-hwa, Hong Kong’s first chief executive, was “a failure” and “just an entrepreneur” lacking political talent, while his successor Donald Tsang Yam-kuen damaged good governance by overly committing to business interests.

According to Goodstadt, the two leaders were responsible for shrinking public housing programmes and liquidating the Housing Authority’s land bank to make way for private developers.

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Third chief executive Leung Chun-ying had a “serious mistrust of a large proportion of the population” while he “miscalculated” his credentials and connections for building diplomacy with mainland Chinese officials, Goodstadt said.

Only Tsang responded to inquiries from the Post over Goodstadt’s comments. “I have much respect for Mr Goodstadt as an old friend of Hong Kong, and he is entitled to his views on how it might be better managed,” Tsang said.

The people of Hong Kong seem to be warning those in power
Leo Goodstadt, author

Goodstadt claimed “the people of Hong Kong seem to be warning those in power that the problems of daily life have become so severe that families can no longer rely on their own resources to survive”.

By the end of 2017, the Hong Kong government held a fiscal reserve exceeding HK$1.7 trillion (US$216.6 billion), official data showed.

While Article 107 of the Basic Law, the city’s mini-constitution, has often been cited by officials to defend frugal policies, Goodstadt questioned whether the government had been using the law selectively. Article 107 stipulates Hong Kong shall keep expenditure within the limit of revenues and strive to avoid a deficit.

He cites Article 35, which protects people’s right to social welfare, and said the local government had neglected the expectations of mainland Chinese drafters of the Basic Law, who sought to improve social services.

Goodstadt said the chief executives also mistakenly promoted “integration” of two different economies, which was “ineffectual” and wasted Hong Kong’s unique role in China’s economic modernisation.

“The most serious – and persistent – of the chief executives’ myths has been the alleged ignorance of Hong Kong people about their motherland and all it has to offer,” Goodstadt said.

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He added that going forward, the greatest challenge for the city’s government would be more about practical issues than political ones.

“How to improve access to post-secondary education, to guarantee adequate medical care for all, to provide safe and comfortable homes for all and to ensure the fair treatment of the workforce … These goals are enshrined in the Basic Law,” he said.

You can’t put all the blame on the chief executives because each of them had to face certain challenges
Lau Siu-kai, Chinese Association of Hong Kong and Macau Studies

Lau Siu-kai, vice-chairman of the Chinese Association of Hong Kong and Macau Studies, a semi-official think tank said: “I agree that the government hasn’t done enough to improve people’s livelihood but you can’t put all the blame on the chief executives because each of them had to face certain challenges such as the two international financial crises [in 1998 and 2008], and now the trade war between the US and China.”

But he said the biggest problem in the past 20 years was that some people refused to accept the “one country, two systems” principle and this made it difficult for the Hong Kong government to implement policies that could improve livelihood.

Ma Ngok, a political scientist from Chinese University, said the chief executives’ reluctance to increase public expenditure and their emphasis on integration were results of a broader political system the city had been trapped under since it returned to Chinese rule.

“The business sector has been drawing close to the central government and pressing the local government to fight for more market access for them ... Meanwhile the general public cannot influence policymaking and implementations ... These form the roots [of mismanagement],” he said.