For discussion
on 16 July 1999

Legislative Council Panel on Security
Measures to tackle indebtedness of Police officers


This paper sets out the current situation of Police officers with unmanageable debts and the measures taken to tackle the problem.


2. The Commissioner of Police is determined to maintain a clean and honest Police Force. He maintains a strict policy against indebtedness of Police officers and requires all Police officers to be prudent and temperate in their financial matters. He also encourages them to adopt a healthy lifestyle.

3. In this connection, the Force Management closely monitors the indebtedness situation by conducting half-yearly surveys on Police officers who have unmanageable debts. The Commissioner of Police also reports regularly the results of these surveys through half-yearly and annual progress reports to the Public Accounts Committee.

4. As reported to Members in September 1998, the economic downturn in the past year had an obvious impact on Force members in the same manner as it had on the community. It is therefore not surprising that the situation of Police indebtedness in the second half of 1998 deteriorated as the adverse impacts of the economic turmoil took full effect.

Current situation of Police officers with unmanageable debts

5. The overall situation has improved over the past four years as the number of officers with unmanageable debts decreased by 10 % from 145 in the second half of 1994 to 130 in the second half of 1998. However, when compared with the first six months of 1998, the latest survey (Annex A) for the second half of 1998 indicates that the number of Police officers with unmanageable debts has increased by 21.5% from 107 to 130. It should be noted that among the 130 officers, only 77 were directly responsible for their indebtedness while the remaining 53 (Annex B) were indebted due to problems of their family members or relatives. Of the 77 officers, the major reasons for incurring debts include overspending (22%), business and investment failure (16%) and gambling (12%).

Loans from the Police Welfare Fund, the Police Credit Union and Advance of Salary

6. Some Members have expressed concern that Police officers could easily obtain loans from the Police Welfare Fund (PWF), the Police Credit Union (PCU) and advance of salary under the Civil Service Regulation (CSR) 6181 , and that some officers may spend this money on luxuries or gambling. Members may rest assured that the Force Management has taken all necessary steps to cross-check the applications for loans from the PWF and advance of salary. All these loans would only be approved for legitimate reasons, such as further studies, house removal, marriage, medical reasons, etc, and applicants are required to produce documentary proof. In addition, all the application forms for loans from the PWF and PCU and advance of salary require the applicant to disclose details of outstanding loans owed to both government or non-government sources.

Measures to Tackle Indebtedness

7. To tackle the problem, the Force Management has implemented a series of measures to prevent, identify and handle indebted Police officers.

Preventive Measures

8. As prevention is always better than cure, the Force Management has adopted the following preventive measures:

  1. educating new recruits on prudent personal financial management;

  2. training of and liaison with Training and Staff Relations Officers in dealing with Police officers with unmanageable debts;

  3. running publicity campaigns on "anti-gambling", "avoid overspending", "integrity and honesty", "fit for tomorrow", "live a simple life" and "support your peers";

  4. launching the second phase of the "Living-the-Values" program in 1998/99 focusing on "integrity and honesty", "internal communications" and "trust"; and

  5. monitoring Police indebtedness at the Force Anti-Corruption Strategy Steering Committee chaired by the Director of Management Services and attended by key Force personnel and representatives of the ICAC.
Identification measures

9. The Force Management has also taken the following measures to identify and monitor Police officers with unmanageable debts:

  1. issuing guidelines to heighten the awareness of frontline supervisors on the extent of indebtedness of individual officers;

  2. interviewing Police officers who are the subjects of inquiries from financial institutions or being listed on notice of tax recovery;

  3. conducting six-monthly surveys on indebtedness among Police officers and interviewing monthly those who have unmanageable debts;

  4. cross-checking applications for loans from the Police Welfare Fund and advance of salary under CSR 618 to prevent borrowing by an officer for the same reason;

  5. organizing "Open Forum" sessions and "Team Building" exercises during Formation Training Days to enhance trust at all levels so as to encourage problematic officers to seek prompt assistance from colleagues.
Handling measures

10. Every newly emerging officer with unmanageable indebtedness will be carefully assessed by the Formation Commander, and referred to the Police Welfare Officers for assistance. Police Clinical Psychologists will also provide counselling services to these officers as necessary.

11. Three stress management workshops were held by the Psychological Services Group for a total of 49 officers with unmanageable indebtedness in the second half of 1998. These workshops were held to help them allay their stress arising from indebtedness, share their experience and rebuild their lives with emphasis on prudent financial management.

12. Whilst the Force Management will render assistance to Police officers who are indebted because of unforeseen or compassionate circumstances, there is no sympathy for officers who borrow simply for indulgence in overspending or gambling. In particular, Police officers who become indebted under the following circumstances will be subject to criminal or disciplinary actions:

  1. illegal gambling, gambling in police premises or whilst on duty;

  2. having financial obligation to any person or organization other than as permitted by the Acceptance of Advantage (Governor's Permission) Notice or the Police General Orders; or

  3. having their efficiency impaired by serious pecuniary embarrassment.
Security Bureau
July 1999

Annex A

Breakdown of reasons of Police officers with unmanageable debts

Reasons of indebtednessFirst half of 1998
(as at 30.6.98)
Second half of 1998(as at 31.12.98)
Gambling26 (24%)16 (12%)
Overspending 30 (28%)28 (22%)
Business Failure 10 (9%)14 (11%)
Investment Failure7 (7%)7 (5%)
Problems of Family Members and Relatives#25 (24%)53 (41%)#
Marriage*4 (3%)NA
Removal of House*2 (2%)NA
Decoration* 1 (1%) NA
Medical*1 (1%) NA
Important Life EventsNA10 (8%)
Others 1 (1%) 2 (1%)
Total107 (100%)130 (100%)

Note:Starting from the survey of the 2nd half of 1998, the reasons of indebtedness are grouped into seven major categories, namely, gambling, overspending, investment failure, business failure, problems of family members (including relatives), expenses on important life events (which include events like funeral, birth, marriage, divorce, serious sickness, court action, etc) and others.

* Cases of indebtedness under these reasons have been absorbed in the new category of *Important Life Events*

# For detailed breakdown, please see Annex B

Annex B

A breakdown of reasons by problems of officers* family members

Reasons Family Members' Problem
Gambling 7 (5%)
Overspending 2 (2%)
Investment Failure5 (4%)
Business Failure 17 (13%)
Important Life Events12 (9%)
Others 10 (8%)
Total 53 (41%)

1. CSR 618 provides that "An officer may apply for an advance of salary not exceeding the dollar value of MPS Point 21 (i.e. $26,805 in 1998/99) towards (a) necessary expenses on moving to new accommodations; (b) necessary expenses arising on the occasion of his marriage of the marriage of his son or daughter; (c) the funeral expenses of a dependent; (d) expenses arising from the commencement of his unmarried son's or daughter's full-time overseas education but excluding tuition fee, boarding fee or daily subsistence; (e) legal expenses incurred by him in civil proceedings or in the purchase of self-occupied accommodation. Stamp-duty on the property is excluded".