For discussion
on on 14 January 1998


Subhead 082 Recoverable salaries and allowances
(Post Office Trading Fund)

Members are invited to recommend to Finance Committee -

  1. the creation of the following permanent posts in the Post Office -

    1 Principal Executive Officer
    (D1) ($92,650 - $98,300)

    1 Chief Systems Manager
    (D1) ($92,650 - $98,300)

  2. the creation of the following supernumerary post in the Post Office up to 31 July 2000 -

    1 Chief Controller of Posts
    (D1) ($92,650 - $98,300)

    offset by the deletion of the following permanent post -

    1 Chief Executive Officer
    (MPS 45 - 49) ($72,135 - $83,105)


There is inadequate directorate support in the Post Office to cope effectively with the increased complexity and volume of work on human resource management initiatives, information technology (IT) and liaison with international and Mainland postal authorities.


2. We propose to strengthen the directorate structure of the Post Office by -

  1. upgrading the post of Departmental Secretary (DS) from the rank of Chief Executive Officer (CEO) (MPS 45 - 49) to Principal Executive Officer (PEO) (D1) to improve qualitative management of human resources;

  2. creating one permanent post of Chief Systems Manager (CSM) (D1) to assist in the formulation and implementation of long term IT strategies to support the business and IT needs of the department; and

  3. creating one supernumerary post of Chief Controller of Posts (CCP) (D1) up to 31 July 2000 to cope with increasing liaison and contacts with Mainland and international postal authorities on development in international and bilateral postal services.


Upgrading of the Departmental Secretary's Post

3. The DS of the Post Office, ranked at CEO, is responsible for departmental administration and human resource management work. He reports to the Assistant Postmaster General (Corporate Development) (D2), except on promotion and staff relations matters where he reports directly to the Deputy Postmaster General.

4. Since the ranking of the DS post at CEO in 1981, the level of responsibilities and complexity of its portfolio have grown tremendously. The establishment of the department has grown by 69% from 3 483 posts in 1980-81 to 5 888 posts in November 1997, despite the hiving off of 215 telecommunications staff, including three directorate staff, to the Office of the Telecommunications Authority in 1993. The major impact on departmental administration and staff management has stemmed from the transfer of the status of the Post Office from a vote-funded department to a trading fund on 1 August 1995. The change has demanded a much stronger administrative support from the DS towards a more commercial and proactive approach to postal services and management. These are detailed in the following paragraphs.

Human Resource Management (HRM)

5. Under the trading fund operation, the department has to be sensitive towards market demand and committed to the provision of quality services. In pursuit of its vision, mission and values, the department places great emphasis on the workforce - "to have a highly motivated and valued workforce", "team up for excellence" and "care for the colleagues and customers". As the department's human resource manager, the DS has to map out strategies and develop programmes to promote and support the necessary culture change among staff in addition to the normal range of HRM functions, including recruitment, promotion, succession planning, staff welfare, staff relations and discipline. The DS is required to have a strategic input into HRM to support the function of the department as it faces the challenge set by the changing commercial environment in which it operates. Activities in which the DS organises to bring about a culture change include the conduct of seminars for staff unions/associations to disseminate the department's vision, mission and values; realignment of the recruitment strategy to the new culture; and enhancement of the incentive activities, including the setting up of a Staff Recognition Fund. The DS has a vital responsibility to review and improve staff relations strategy to strengthen mutual understanding and trust. This includes maintaining a close dialogue with the eight active staff unions in the department to obtain views and secure their understanding and support.

6. The DS will play a central role in the major programme to develop core competencies for the departmental grade staff, including the Controller of Posts, Postal Officer and Postman grades with a view to help improving performance management. This will also serve as a "drive programme" for other HRM programmes. His strategic role will cover means of securing staff commitment, setting standards and providing development opportunities and management support to the staff in attaining the higher level of performance advocated by the department.

New Management Initiative

7. The Post Office senior management is drawing up a departmental strategy framework for the coming five years. A strategy group, chaired by the Postmaster General (PMG), of which the DS is a core member, has been set up to oversee the development of a HRM plan to build up a highly skilled and involved workforce to prepare for the challenges in the next five years.

8. In view of the DS's higher level of responsibility and complexity of work, and the growing importance of his role as a change agent, the PMG and the Director of General Grades consider that the post requires an experienced officer with strong HRM background and skills to forge ahead with the implementation of the management initiatives. It is considered that the duties and responsibilities of this post are such that it should be upgraded to PEO (D1) level.

Creation of one Chief Systems Manager Post

9. The Post Office has implemented a large number of initiatives to improve its service to customers after moving to trading fund operation on 1 August 1995. However, in an environment increasingly driven by technology, further improvements in efficiency and the service to customers will depend heavily on how effectively the Post Office applies IT.

10.Recognising the threat of IT to postal business, some overseas postal administrations have started to develop their own electronic commerce service, including certification authority, electronic postmark service etc. which may gradually transform some of the traditional letter post into an electronic product. The Universal Postal Union (UPU) has established a working group to develop a set of guidelines and standards for member postal administrations to follow in developing these services. The Post Office is closely monitoring the development of the electronic commerce services, with a view to implementing such services at the appropriate time. Such developments, plus a number of areas where the Post Office has a pressing need to computerise its operations, cannot be managed without strong in-house IT expertise.

Need for a Dedicated Team of IT Professionals

11.At present, the Post Office has an Information Technology Division headed by a Senior Controller of Posts (SCP) (MPS Point 45 - 49) to look after its operational IT needs. His main areas of responsibility are user liaison and project management. One Senior Systems Manager (SSM) post and one Systems Manager (SM) post were created in October 1996 on the Post Office establishment to oversee the development of a computerised track and trace system for mail.

12. The major problem of the existing IT organisation is the lack of a dedicated team of IT professionals, which understands the Post Office's operations and its priorities, and is capable of developing strategic IT in response to the rapid changes in IT. The present practice of assigning IT personnel from the Information Technology Services Department on a project basis is not effective. The Post Office requires a team of in-house IT professionals headed by an officer with sufficient knowledge, experience and authority to plan IT systems to address corporate information needs, and to grant technical approval to IT projects. The Post Office plans to implement IT systems costing some $160 million in 1998-99. The setting up of a team of IT staff will allow the Post Office to respond better to rapidly changing customer needs in a market that is increasingly competitive.

13. The PMG and the Director of Information Technology Services consider that a permanent post of CSM (D1) should be created on the Post Office establishment to head a second IT Division to give technical support and help formulate and implement a long term IT strategy to support the Post Office's operations, improve efficiency and meet the changing needs of customers. The SCP will continue to head the existing IT Division overseeing the business aspects.

Creation of a supernumerary post of Chief Controller of Posts

Negotiations with Overseas Postal Administrations

14. The Post Office is one of the leading postal administrations in the region and the world in terms of mail traffic handled. Some 215 million international mail items are handled every year. The Post Office has been very active on the international postal front and enjoys a high standing and good reputation in the international postal community. The Post Office continues to operate as an autonomous postal administration after reunification, including negotiating with overseas postal administrations over service arrangements. Operating in an increasingly competitive environment, the Post Office needs constantly to upgrade the quality of its services. It is extremely important that the quality of services provided by overseas postal administrations meet the standards required by the Post Office, in order to deliver tangible quality improvements to customers. The Post Office will soon embark on a series of negotiations with overseas postal administrations with a view to the signing of memoranda of understanding on service standards to be provided by them. A directorate officer with appropriate standing and extensive experience in postal operations is required to lead the negotiations.

Liaison with Mainland Postal Authorities

15. The Post Office participates in international events either as a member of the delegation of the People's Republic of China, or on its own, at events not limited to States. The continued participation in these international activities is very important for the Post Office to influence developments on important issues in the international postal community. To achieve this, the Deputy Postmaster General has to liaise frequently with the Mainland postal authorities prior to attending international meetings and conferences to discuss strategies and policies, and to ensure that Hong Kong's position, even where it may be different from that of the Mainland, can be advanced. With this increasing liaison work, it has become apparent that the existing level of support given to the Deputy Postmaster General by a SCP is inadequate.

16. Hong Kong's reunification with the Mainland has brought a closer relationship between the two postal administrations. A number of new or improved services are being considered. These include the introduction of postal remittance service, the extension of direct mail exchange with more cities in the Mainland, the expansion of the Speedpost network and the establishment of better service standards. Frequent discussions with the Mainland postal authorities at ministry, provincial and city levels are necessary, at this initial stage of development, to agree on the expanded scope of services and the operational arrangements for these services. This puts further strain on the manpower of the Post Office.

UPU Congress

17. The next UPU Congress, a major event held every five years, will be held in August 1999 in Beijing. China, as the host country of this Congress, has set up an organising committee to prepare for this major international event. As part of the Chinese delegation to the UPU, the Post Office will be taking an active part in preparing for the event, both in liaising with the UPU and other overseas postal administrations, and in discussing and agreeing with the Mainland postal authorities on the strategies to be adopted on issues to be raised at this Congress. The work involved is highly complex and will require input from a dedicated officer at directorate level with necessary experience, competence and skills.

18. In view of the above, the PMG considers that a supernumerary CCP post should be created to head an External Affairs Division. It is expected that the proposed CCP will have to wrap up co-ordinating work after the Congress. The post will therefore be required up to 31 July 2000. Thereafter, the PMG will review the need for this post.

19. The job descriptions of the proposed posts of PEO, CSM and CCP are at Enclosures 1 to 3 respectively. The existing and proposed organisation charts of the Post Office are at Enclosures 4 and 5 respectively.


20. The additional notional annual salary cost of this proposal at mid-point is -


No. of posts

New permanent posts

PEO (D1)
CSM (D1)



New supernumerary post

CCP (D1)






Permanent post to be deleted

CEO (MPS 45 - 49)






21. The additional full annual average staff cost of the proposal, including salaries and staff on-costs, is $4,526,150. In addition, this proposal will necessitate the creation of one additional Personal Secretary II post at an additional notional annual mid-point salary cost of $171,960 and an additional full annual average staff cost of $283,620. Sufficient provision is available under the 1997-98 Post Office Trading Fund Business Plan to cover the additional costs of the proposal.

22. The financial requirements for implementing the above proposal represent 0.13% of the estimated total recurrent expenditure of the Post Office. Therefore, the proposal will have minimal impact on fees.


23. In August 1997, a supernumerary CSM post was created on the Post Office establishment for six months to manage a study to develop a long term strategy plan for IT development in the Post Office. Subsequent, an Information System Strategy Study commenced in November 1997 and the report of the study will be ready by early 1998. Upon creation of the permanent CSM post, the supernumerary post will be deleted.

24. In July 1996, the directorate structure of the Post Office was re-organised. One of the associated changes was to split the International Affairs and Operations (IOS) Division into two as the External Affairs and the Operations Support Divisions, each to be headed by a SCP and to report to Assistant Postmaster General (Corporate Development) and Assistant Postmaster General (Postal) respectively. However, the split of the IOS Division was suspended, pending a review of the function of the Division when the relationship with the Mainland postal authorities after reunification became clearer. The IOS Division was, nevertheless, renamed as External Affairs and Operations Support Division (EOS) and has remained under the supervision of Assistant Postmaster General (Postal).

25. The Post Office has reviewed the situation. Having regard to the importance of maintaining an influential role in the international postal community and the growing contacts with the Mainland postal authorities, it is considered that a new External Affairs Division should be set up to serve as a contact point with the UPU, Mainland postal authorities and the overseas postal administrations. As the issues to be dealt with will have significant implications for the Post Office and affect all the existing three branches, the new Division should be headed by a CCP instead of a SCP as originally proposed (the creation of the SCP post has been held in abeyance pending the review) and be put under the direct supervision of the Deputy Postmaster General. After the split, the Operations Support Division, to be headed by a SCP, will remain under Assistant Postmaster General (Postal) who will be responsible for various reviews aiming at service improvement, including the quality of service for both domestic and international mail services.


26. Civil Service Bureau supports the upgrading of the DS post and creation of two D1 posts in the Post Office to strengthen directorate support in dealing with increased activities associated with departmental administration, IT development and liaison with Mainland and international postal authorities. The grading and ranking of the proposed posts, as well as the duration of the supernumerary CCP post, are considered appropriate in the light of the level of responsibility and professional expertise required.


27. The Standing Committee on Directorate Salaries and Conditions of Service has advised that the grading proposed for the posts would be appropriate if the posts were to be created.

Economic Services Bureau

January 1998

Enclosure 1 to EC(97-98)48

Job Description for the Departmental Secretary
Post Office

Rank : Principal Executive Officer (D1)
Responsible to : Assistant Postmaster General (Corporate Development)

Duties and Responsibilities :

  1. To develop and formulate human resource policy and strategy, in supporting the senior directorate to achieve the vision, missions and values of the department and to serve as member/secretary to the Post Office Policy Committee.

  2. To develop and formulate staff relations and staff consultative strategies and action plans, and to serve as a management representative of the Departmental Consultative Committee and to deal with staff relations issues.

  3. To advise the senior directorate on all human resource functions such as recruitment, promotion, retention, motivation, conditions of service, discipline, performance management, staff welfare, and establishment matters such as staffing request, ranking of posts and deployment of human resources.

  4. To oversee the efficient provision of administrative support to the department, including office organisation and procedures, record keeping, translation service, secretarial and typing service and staff recreation activities.

  5. To supervise all general grades staff in the department and to provide administrative support to the department.

Enclosure 2 to EC(97-98)48

Job Description for the Chief Systems Manager

Rank : Chief Systems Manager (D1)
Responsible to : Assistant Postmaster General (Corporate Development)

Duties and Responsibilities :

  1. To head the Information Technology Division II for the development and implementation of new information technology (IT) systems and the effective use and maintenance of existing systems.

  2. To act as the departmental IT authority and grant technical approval to all technical proposals, feasibility studies etc. relating to IT systems on being satisfied that these comply with the appropriate technical standards and serve the best interest of Hongkong Post.

  3. To act as the IT advisor to the senior management on the trend of IT and the areas where IT may provide solutions to the Post Office's problems.

  4. To oversee the formulation of IT strategies and policies and their implementation upon approval by the management.

  5. To liaise with Information Technology Services Department and other external organizations on all matters relating to IT development in the Post Office.

  6. To oversee the collection and analysis of technical intelligence and advise on the development in the IT industry, and the scope of applying new technologies to upgrade the service to customers and/or improve operational efficiency.

Enclosure 3 to EC(97-98)48

Job Description for the Chief Controller of Posts

Rank : Chief Controller of Posts (D1)
Responsible to : Deputy Postmaster General

Duties and Responsibilities :

  1. To act as contact point with the Mainland postal authorities to devise strategies and policies for matters relating to service development between Hong Kong and China.

  2. To participate in the planning work for the Universal Postal Union (UPU) Congress held in 1999 in Beijing, and undertake other organising work relating to the Congress as the need arises.

  3. To represent Hong Kong Special Administrative Region in the UPU monitoring group to discuss the strategies on International Express Mail, other international postal conferences and projects.

  4. To co-ordinate all matters relating to the implementation of UPU Congress decisions and resolutions and review the subjects for further improvement.

  5. To review, recommend and oversee the implementation of necessary adjustments to all postal treaties and conventions.

  6. To conduct study on terminal dues and devise policies on necessary charges.