LegCo Paper No. FC 133/96-97
(These minutes have been
seen by the Administration)
Ref : CB1/F/1/2

Legislative Council Finance Committee

Minutes of the proceedings of the meeting held on Friday, 16 May 1997, at 2:30 pm in the Legislative Council Chamber

Members present :

Members absent :

Public officers attending :

Mr Kevin HO, JP: Secretary for the Treasury (Acting)
Mrs Carrie LAM: Deputy Secretary for the Treasury
Mr TAM Wing-pong, JP: Deputy Secretary for Trade and Industry
Mr K K WONG: Principal Executive Officer of Trade and Industry Branch

Clerk in attendance :

Mrs Vivian KAM: Assistant Secretary General 1

Staff in attendance :

Mrs Constance LI: Chief Assistant Secretary (Finance Committee)
Ms Anita SIT: Senior Assistant Secretary (Finance Committee)1

As Dr Hon YEUNG Sum, Chairman, was engaged in other commitments, the meeting was chaired by Hon CHAN Kam-lam, Deputy Chairman.

Item No. 1 - FCR(97-98)9
RECOMMENDATIONS OF THE ESTABLISHMENT SUBCOMMITTEE MADE ON 30 APRIL 1997

2. The Committee approved the proposal.

Item No. 2 - FCR(97-98)10
RECOMMENDATIONS OF THE PUBLIC WORKS SUBCOMMITTEE MADE ON 23 APRIL 1997

3. The Committee approved the proposal.

Item No. 3 - FCR(97-98)11
HEAD 96 - GOVERNMENT SECRETARIAT: OVERSEAS OFFICES Subhead 001 Salaries
Subhead 002 Allowances

4. Some members sought clarification on the proposed pay packages for the locally engaged (LE) staff in the Hong Kong Economic and Trade Offices (HKETOs). With regard to the pay scales for HKETOs in Washington, New York and San Francisco, the Deputy Secretary for Trade and Industry (DS/TI) explained that most of the LE staff in these offices were for historical reasons recruited by the British Embassy (BE) or British Consulate General (BCG) on behalf of the Hong Kong Government, and they were remunerated on BE or BCG pay scales. For HKETOs in other countries, only a small number of LE staff were engaged and their pay followed that of the BE/BCG local staff in their host countries mainly for the sake of convenience. In reply to a member, DS/TI advised that the proposed employment terms for these staff were in full compliance with the employment legislation of the host countries. The pay packages were also broadly comparable with the remuneration package of LE staff in the Hong Kong Trade Development Council (TDC) overseas offices. By way of illustration, a LE clerk in London Office was paid between £870 - £1,120 per month while £1,092 was paid by the TDC office.

5. On the proposed 2% increase in pay for LE staff in the three HKETOs in the United States (US), DS/TI explained that this was to provide incentive for the existing staff working in these offices for accepting the new employment terms and to compensate for the lack of promotion prospects in the HKETOs. DS/TI also confirmed that the question of tax liability and pension benefit had been considered by the Administration with actuarial advice, and that the granting of contract gratuities in lieu of pension would not result in extra tax or reduced pension benefit for the staff concerned. In this connection, a Bill was expected to be enacted in the US which would, among other things, exempt those LE staff who were non-US citizens from payment of salary taxes.

6. On the additional annual costs of $1,456,000 to Government, DS/TI advised that this was largely due to the 3.03% salary adjustments for LE staff in the Tokyo office and payment of contract gratuities under the new package.

7. Responding to a member on the proposed delegation of authority to the Secretary for the Treasury under paragraph 2(d) of the discussion paper, DS/TI confirmed that Finance Committee approval would be sought should future pay adjustment exceed the annual pay adjustment for the civil service in the respective host countries or cities.

8. The Committee approved the proposal.

9. The Committee was adjourned at 2:55 pm.

Legislative Council Secretariat

27 May 1997

*.. other commitments

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