(Summary translation)

5 December 1996

Hong Kong Confederation of Trade Unions’ Position Paper on the Consultation Paper on the Review of the Employees Retraining Scheme

1. The results and recommendations of the review as a whole are disappointing, reflecting a failure to identify future directions for Hong Kong’s manpower training policy and making the already fragmented policy more divided. What we urgently require is a training policy with a long-term perspective, so as to help the working population in Hong Kong adapt to the ever-changing economic environment. It is a pity that the contents of the review report compiled by the Government are both superficial and short-sighted in terms of policy direction.

Among the results and major recommendations of the whole review report, only one point is concerned with policy direction: the Employees Retraining Board (the "ERB") should target those unemployed persons aged 30 and above, including new immigrants. However, the report has turned a blind eye to the fundamental question concerning manpower training policy : how to upgrade the skills of those with lower academic qualifications and technical skills so as to enable them to meet future needs arising from the economic development in Hong Kong? The future economic system of Hong Kong will be certainly dominated by the selling of service and knowledge. Therefore, those with lower academic qualifications must command new knowledge to strengthen their ability to make a living and earn higher wages. We expect the training policy to be a value-adding process for workers. However, the review report is totally disappointing in this respect.

2. Target Retrainees

1. The Hong Kong Confederation of Trade Unions (the "CTU") is opposed to the recommendations that all skills upgrading courses for the unemployed persons now offered under the Employees Retraining Scheme (the "ERS") be taken over by the Vocational Training Council (the "VTC") for the following reasons:

  1. The planning and implementation of manpower training programmes should be carried out by a single institution instead of being done by two different institutions concurrently. By so doing, it will ensure a comprehensive manpower training policy in Hong Kong. Having one institution to carry out such policy will ensure its consistency.
  2. The review report, in making the proposal, has failed to spell out how the VTC will take over all skills upgrading courses. According to information obtained from the VTC, even the VTC itself was not aware of the Government’s ideas. Although what is contained in the review report is only a suggestion, it has made no mention of its concrete details, reflecting the report’s perfunctory and superficial nature. In our opinion, any responsible recommendations should at least make the following points clear:
    1. At present, courses conducted by the VTC require participants to pay fees while those offered under the ERS are free of charge. What will be the future arrangements?
    2. The minimum admission requirement for courses conducted by the VTC is Secondary 3 level whereas courses under the ERS cater specially for those who have educational attainment at Primary 6 or below.
    3. The VTC is inexperienced in providing training for persons who are unemployed, semi-unemployed or having difficulties in finding employment. How will it deal with problems concerning its teaching staff and materials being out of touch with current needs?
    4. At present, skills upgrading courses are funded by the ERB and provided by various institutions. What will be the future arrangements? Will these courses be solely provided by the VTC or will current arrangements under the ERB continue?
    5. What extra resources will be allocated to the VTC for taking over these courses?
    6. What will be the transitional arrangements? The report only stressed that the training needs of the elderly and the disabled will not be affected. What about other people in need of training?
  3. The recommendations by the Government show a total disregard for the needs of local employees. The ERB has provided training for a total of 140 000 persons, 60 per cent of whom have attended evening or part-time skills upgrading courses, reflecting the huge demand for such courses.
  4. Cost effectiveness: the review report on the VTC pointed out that the VTC does not provide skills upgrading courses partly because its courses are more expensive than those offered by other institutions, which points to the fact that the current arrangements are more cost effective than having the VTC provide such courses.

The CTU is of the view that the ERB should be responsible for coordinating all manpower training courses catering for adults while the VTC should be responsible for coordinating all industrial training programmes catering for young students.

2. The CTU supports the recommendation that target retrainees under the ERS be limited to those who are aged 30 and above, with no more than Secondary 3 education, and the ERS should be expanded to include new immigrants as well. The CTU agrees that target retrainees should include new immigrants because they are part of Hong Kong‘s working population and they should be trained to acquire hi-tech skills. However, the CTU is opposed to the ERB’s exclusion of persons other than those unemployed because we believe that the aim of the retraining scheme should not be limited to solving unemployment problems, it should also help local workers upgrade their skills to meet future needs.

3. Course structure and Contents:

We support the recommendation concerning the structure of the retraining scheme for its emphasis on the job-specific skills training though in its selection of what training courses to offer, it demonstrates short-sightedness.

4. Retraining Allowance

The CTU is strongly opposed to the proposal to reduce the amount of Retraining Allowance from $1,000 per week to $500 per week on the grounds that it will prevent such allowance from being abused. This proposal will be counter-productive in that it will force those unemployed persons, who cannot live without a job, to look for whatever jobs available, thus giving up the chances of upgrading their skills. In our opinion, the community should encourage workers to receive retraining so as to meet future needs arising from the development of the economy. However, the above proposal has run counter to this end. On the surface, it will save the Government $18 million. But is it worthwhile saving this amount of money at the expense of dampening workers’ eagerness to receive retraining?

5. A placement-tied and performance-based funding system for training bodies

According to this recommendation, the sole criterion for judging the success of retraining scheme will be the number of its trainees who have succeeded in getting job placement while its contents or skills-upgrading functions are of no relevance. Such criterion is a short-sighted one in that training bodies will be tempted to favour trainee candidates who have a better chance of finding employment while rejecting those who have less chance. Moreover, training bodies will not have stable financial resources to plan and launch training courses. It is the workers who will suffer in the end.


The review report as a whole demonstrates a lack of both vision and commitment on the part of the Government in terms of manpower training policy. Although the Government proposes to make a further capital injection of $500 million to the ERB next year, that does not mean the Government will increase its commitment. According to Mr TAM Yiu-chung, Chairman of the ERB, this injection of funds is for use up to 2000, which works out to be about $270 million a year, representing an increase of less than 10 per cent. But the scope of the ERS will be expanded to cover new immigrants. Though the VTC will take over all skills upgrading courses, it is not clear whether it will be allocated additional funds. The CTU has long been pressing the Financial Secretary to set aside $500 million each year for retraining purposes. We believe the Government must invest heavily in manpower training so as to prepare Hong Kong for the 21st century.

Finally, we reiterate our position that the Government must formulate a comprehensive and long-term manpower policy. The current review is far from being able to meet the requirements in this respect.

LEE Cheuk-yan
Chief Executive
Hong Kong Confederation of Trade Unions

Last Updated on 21 August 1998