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On the recommendation of the Independent Commission on Remuneration for Members of the Executive Council and the Legislature of the Hong Kong Special Administrative Region, the Chief Executive in Council has decided that the remuneration package for members of the fourth-term Legislative Council be enhanced, by increasing the members' monthly remuneration, and by providing an annual accountable medical allowance and an end-of-term gratuity.
A government spokesman said that in conducting the review, the commission took an objective and forward-looking approach - to determine not the remuneration for the incumbent Legco members, but the appropriate package for the next term of Legco members due to be elected.
"The independent commission was also guided by the principle that the remuneration package should be commensurate with the powers and duties vested in Legco members, be attractive to talent wishing to run in elections, and be sufficient for those who regard Legco work as their main occupation to maintain a reasonable standard of living. The independent commission also factored in the objective of grooming political talent in the longer term," the spokesman said.
Monthly Remuneration and End-of-Service Gratuity
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The commission recognised the increasing volume and complexity of Legco's work, and the heavier responsibilities and higher public expectations placed upon Legco members. Moreover, a greater commitment of time by the members was now needed.
"In recognition of these factors, the independent commission recommended an increase in the monthly remuneration for Legco members," the spokesman said.
"The independent commission further noted that there had been no change to the level of the monthly remuneration since 1991, except the annual adjustments in accordance with the movements of the Consumer Price Index (C). The real value of the monthly remuneration had been curbed without moving in line with the growth of real income in the rest of Hong KongĄ¯s society."
Having examined indicators on the growth of real income, the commission recommended that the monthly remuneration be increased by 15%.
"This will raise the monthly remuneration from the present level of $56,750 to $65,263," the spokesman said.
The monthly remuneration for the Legco president and the president's deputy will continue to be fixed at 200% and 150% of the remuneration for their fellow Legco members, i.e. $130,526 and $97,895 respectively after the 15% increase.
The spokesman said the commission was sympathetic to Legco members' request that a gratuity at 15% of the total remuneration that a member received during a Legco term should be payable at the end of a Legco term.
"Acknowledging the need to provide some form of protection to help Legco members tide over a period should they decide not to seek re-election or fail to be re-elected, the independent commission recommended that this request be acceded to."
Annual Accountable Medical Allowance
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At present, Legco members are allowed to reimburse the costs of their medical and dental insurance policies from the Operating Expenses Reimbursement (OER).
"However, many Legco members had suggested that they had given priority to other demands on the OER (such as operating offices and engaging staff), and had not spared resources for their personal insurance plans. The independent commission recommended that the present arrangement be strengthened by the provision of a separate, additional annual accountable medical allowance of $25,000," the spokesman said.
"Legco members can use this allowance to pay for the premium of their personal medical and/or dental insurance cover, or their actual medical and dental expenses, or both.
"The independent commission further recommended that the above enhancements should take effect from the fourth-term Legco due to begin in October, 2008.
"This recommendation is in line with the principle that any substantial changes in the remuneration package should be implemented only in the following Legco term, a principle which seeks to preserve the integrity of the remuneration regime," the spokesman said.
"The independent commission also reviewed other components of the remuneration package. Having examined their utilisation rates, the independent commission recommended that the OER, Entertainment and Travelling Allowance (ETA) and the one-off provisions for setting-up, information technology and communications, and winding up, were largely adequate and their present levels should be maintained and would continue to apply to the fourth-term Legco. It further recommended that the current price adjustment mechanism applicable to the monthly remuneration, the OER and the ETA, i.e. adjustments in accordance with movements of the Consumer Price Index (C), should be retained and also applied to the proposed medical allowance.
"The additional funding required to implement all the recommendations for the fourth-term Legco, save for any annual price adjustments to be made, will be about $60 million," the spokesman said.
The commission is chaired by Mr Vincent Cheng Hoi-chuen and comprises Mr Chung Pui-lam, Professor Liu Pak-wai, Mr Nicky Lo Kar-chun, Mr Tim Lui Tim-leung and Mr Ng Leung-sing as members. It advises the Chief Executive on the remuneration package for Legco members. As it is the practice of the commission to conduct a comprehensive review of the package about a year before the start of a new Legco term, the commission started the review in April, 2007. It has submitted its review report (copy attached) to the Chief Executive for consideration.
Ends/Tuesday, December 18, 2007
Issued at HKT 16:00
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