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January 2006

On the buses

Last Saturday the SCMP published a letter from New World First Bus in response to a letter last Wednesday that said that they "get completely free use of the roads" (whereas the MTR and KCR have to pay for the railbeds).  It was quite a short letter, but it made two splendidly ludicrous claims: 

In fact, bus companies and their passengers pay dearly for using roads in Hong Kong, in the form of a congestion (time) charge that serves to increase operating costs and thereby directly impacts upon fares. This penalty is, of course, mitigated to a great extent by the superior comfort of bus travel in Hong Kong, with most passengers being conveniently chauffeured from door to door in an individual seat space that is climate- controlled, inviting and altogether very relaxing.

Good grief.  What is an "individual seat space"?  What use is it to have the climate controlled by someone who apparently owns shares in "North Face".  Or a "chauffeur" who accelerates away and then slams on the brakes?  And not even any mention of Idiot TV, I see. 

As for the congestion on Hong Kong's roads, even a public transport enthusiast such as myself can see that there are too many buses operating at most times of the day.  Could this possibly be because the bus companies pay so little for fuel?  Would that be a subsidy, perhaps?

No surprise that Jake van der Kamp and David Webb have both responded to this nonsense, so I'll leave it to them.

Continue reading "On the buses" »


Still in the dark ages

My ATM card has been slightly broken for several months, but I've never quite got round to going to the bank to request a new one.  Well, it worked,  so why bother?

Until Sunday, that is, when the machine swallowed the card and was unable to return it to me.  I stood there for a few minutes, wondering why this advanced piece of machinery couldn't tell me the nature of the problem, and also why it was refusing to give me my money, but it steadfastly refused to give me my money or my card back. 

So today I went back to pick up my card.  Not available.  Apparently it takes a couple of days for the card to travel 50 metres or so from the ATM machine to the customer service desk.  However, amazingly enough when I started screaming and shouting it suddenly appeared from nowhere.

Next problem is that there is every chance that the next time I try to use the card it will be swallowed again.  So how can we solve the problem?  Well. luckily I had some ideas.

I can see that it may take a few days to create a new card, so how about we set up my credit card (from the same bank) so that I can withdraw cash from my savings account?  Oh, and advise me of the PIN because I've forgotten it.  Shouldn't take long, should it?  Oh no, sir, it probably can't be done before Chinese New Year.  WTF?

Watching the staff try to deal with these simple requests is quite something.  My name and account number have to be manually copied from a computer screen on to a printed form so that I can sign it.  Then this paper request has 'Top Urgent' (= "shouting Gweilo") stamped on it and then I suppose it is passed across to the clerks with the quill pens to deal with it at their leisure    

Hey, guys, ever thought of designing a software program that could print out the form with my difficult Gweilo name and my account number on it?  Surely that can't be too hard?  Then you could investigate automating the whole process so that the request is sent electronically to the appropriate person to deal with it.  Maybe it could be done in hours rather than days.   

No, I thought not.  Maybe all this technology stuff will never catch on - there's nothing wrong with paper and pen, after all. 


A small misunderstanding

The government has come up with an altogether more sensible explanation for what they are trying to achieve with new legislation about discrimination and expat salaries, as the SCMP reports:

Provisions for expat packages in the proposed anti-racism law will help rather than hinder companies' recruitment of the best employees for the job, the deputy secretary for home affairs said yesterday.

Mr Fisher said yesterday the proposal did not intend to make expatriate terms more difficult to get, nor would it add any more "bureaucracy" to the process, as some head hunters feared. Instead the exception was aimed at protecting companies.  "When the law is passed, a person who feels aggrieved [by a colleague getting differential pay terms] can bring a case against the employer," Mr Fisher said.

"We want to provide an exception in the bill to ensure people cannot bring a claim without good reason. The defence, if the case is brought against the employer, is that the staff have skills not readily available in Hong Kong and the staff are from overseas and not a Hong Kong permanent resident."

This does at least make some sense, though there are still some obvious absurdities here - surely it will make it more difficult to get expat terms (assuming anyone takes notice of the legislation), and it also seem to imply that the employer might want to stop their expat employees getting permanent residence.  Could you have an employment contract that specified certain benefits would cease if the employee became a permanent resident?  If that is possible, would the employer know whether the individual had become a permanent resident?  Would people really be asked to make the choice between the expat package or taking permanent residence?

I suppose we have to wait for the actual legislation will say, but I still find it hard to see how this is all going to work. 

What amuses me is that both the SCMP and The Standard came to the same conclusion about the intention of the planned legislation, and now the government is saying that it was all a misunderstanding.  It's not unknown for governments to float ideas in "off the record" briefings and deny them later, but it's a different matter when a senior civil servant is quoted directly.  What's going on here?


Letter of the week

The letters published in the SCMP are a constant source of amusement to me.  Today they have come up with another gem:

Have the chief executive or financial secretary given any thought to the tremendous cost to taxpayers of a five-day working week being introduced for the civil service in Hong Kong?  The shorter working week will mean, for one thing, that the disciplined services - police, fire, customs, immigration, prisons and hospitals - will have to increase staff strength by about 20 per cent.

Present salaries are based on a six-day working week. If this is reduced to five days, will salaries be reduced accordingly?

J. FLEMING, Cheung Chau

I suppose they have the SCMP on Cheung Chau, so J Fleming would have been able to read the information published in that fine newspaper on this very subject. 

In which case he or she would know that civil servants have a 44 hour working week, made up of 5 weekdays (8 hours each) and 4 hours on Saturday morning (then, as we know, they all rush off to Shenzen to spend their hard-earned salary in Chinese shops and restaurants).  If their working working hours were being reduced from 44 to 40 that would be a 10% cut, but actually the plan is that they will still work 44 hours, but over 5 days rather than 6 days.  Simple enough, really.    


Memoirs of a Geisha

I see that Mr Fumier and Mr Harbour have both been to watch this movie recently.  Me too.  As you may be aware there seem to be two schools of thought on this one, or maybe three if you include Fumier's perspective:

Criticism has also been made of the crappy dialogue, historical inaccuracies, failure to live up to the book, and the general Holly-woodiness of the film. For me, this is just eggheads carping. We are talking quality totty here - three of the best looking birds around, together in one film. Quality totty is quality totty whichever way you look at it. Rabbitting on about historical stuff is like saying tea tastes better out of a china cup. Pass the sick bag, Alice.

Much has been made of the fact that three Chinese actresses (Gong Li, Michelle Yeoh and Zhang Zi Yi) play leading roles in the film, apparently being plenty Asian enough to pass for Japanese as far as Hollywood is concerned.  As Phil says, it has to be an improvement on having an American actress in the part, which is probably what would have happened ten years ago.  As luck would have it, all the other main characters, speak exclusively in English, but minor characters do say a few words of Japanese lest we forget where the story is set.  I can just about live with that, but was it really necessary for them to talk in pidgin English and mumble a lot of the dialogue?

Apart from that, I don't have much to say.  It's a Hollywood movie, with all that implies, and probably better than average.  The cinematography is stunning, but it's about an hour too long (possibly because everyone talks so slowly). 


What they don't want you to hear

In Saturday's SCMP, Albert Cheng was complaining about the government's lack of plans for digital radio in Hong Kong (subscription required):

In Hong Kong, a steering committee was set up in 1998 to look into digital radio. It was assigned to co-ordinate trial tests by public and commercial broadcasters. The test results have been satisfactory, proving beyond a doubt that Hong Kong is ready for digital broadcasting.

A government-commissioned consultancy study also confirmed that there would be a market demand for the new service. The only uncertainty was whether consumers could afford the new radios. The government, therefore, decided that the market should drive the introduction of digital broadcasting.

Since then, market conditions have ripened. The government has taken another step forward by suggesting that future digital broadcasters should be regulated by the current licensing framework. Existing broadcasters will be allowed to continue traditional broadcasting on the current frequencies.

In a nutshell, everything is ready for the city's launch into a new era of digital broadcasting.

But at a recent meeting of the information technology and broadcasting panel of the Legislative Council, commercial radio stations were so desperate to safeguard their vested interests that they became illogical. One spokesman for Metro Broadcast urged the government to stifle the demands of the market in order to protect the station's near- monopoly status.

Gosh, that would be a first in Hong Kong. 

Digital radio took a while to take off in the UK, and at first it seemed that the companies that had paid for licences had miscalculated, but now the prices of receivers has dropped significantly (I read somewhere that it was one of the most popular Christmas presents this year) and audiences are on the up.

The BBC has created a series of new channels (1Xtra, 6 Music, BBC 7, Asian Network, 5 Live Sports Extra) and commercial broadcasters have come up with new stations and made previously local-only stations available nationally.  Stations that were consigned to poor quality AM are now available on high quality digital.  Everyone's a winner.   

Surely if Hong Kong people were given the chance to buy a digital radio for a few hundred dollars and get a much greater choice of channels, they would jump at the chance.

Mind you, in the UK there are so many channels squashed into the digital spectrum that the quality is actually worse than FM


It still doesn't make any sense

Still on the subject of expat pay, Simon points out that David Webb has a letter on this subject in today's SCMP.  He points out is that although it is widely-believed that Hong Kong has a simple flat-tax system there are actually plenty of ways to pay less tax, one of which is to provide a housing allowance, a common component of expat packages. He also thinks he has spotted some hypocrisy in this proposal:

If Deputy Secretary for Home Affairs Stephen Fisher is serious about denying permanent residency to anyone getting what he calls "expat packages" or "overseas terms", then would he please tell us how many civil servants of his grade or above receive housing, rental allowances, overseas education for their children, air-conditioning allowances and other perks from their employer?

What utter hypocrisy.

The form of remuneration should have no bearing on a person's eligibility for permanent residency. Employers should be allowed to remunerate employees in whatever form they choose to recruit and retain talent, whether from Hong Kong or overseas, permanent resident or not. The total cost of compensation reflects the free-market value of an employee to an employer. How it is structured, in cash or benefits, is usually driven by other considerations.

The government should instead remove its fiscal incentive to structure packages. Employees should be taxed on the full value of all benefits received, including housing. Currently, housing or rent is only deemed to be worth 10 per cent of the value of the other income from the employer

Although Mr Fisher did say that the government would prevent people on "overseas terms" becoming Permanent Residents, this does not apply retrospectively, and I imagine that 99% of the civil servants on those terms have already become Permanent Residents and that very few (if any) generous packages like that are still on offer. 

"Those already on expat packages can continue on the existing terms of employment provided they remain in the same group of companies," he said.  "But after the law is in place, anyone recruited on overseas terms must have expertise that is not readily available in Hong Kong and that person must not be a Hong Kong permanent resident. If that person wants to remain on the overseas terms, he or she cannot become a Hong Kong permanent resident."

Anyway, it's all nonsense if you ask me.  How do they define "overseas terms"?  As far as I know it is quite legal to offer local staff a housing allowance or any of the other benefits that expats may be given, so how can they tell who is on "overseas terms"?  Oh, by the fact that are foreigners, right?  No discrimination there, then.

Also, if this mythical expat wanted to become a Permanent Resident, all they need to do is re-negotiate their package, swapping some of the benefits for cash.  Pay a bit more tax and become a Permanent Resident.


Discriminating expats

The most puzzling story of the week is the one about the government outlawing expat pay packages. The SCMP ran this story (subscription required) on Wednesday:

Hong Kong companies will have to justify their offers of generous "expat packages" to foreign employees under an anti-racism bill now in an "advanced stage of drafting". They will have to prove the recruit has expertise not readily available in Hong Kong, and permanent residents will not be able to receive such special terms.

Are we really supposed to believe that although Hong Kong has no minimum wage, there is going to be legislation to stop companies paying staff more than they are worth? Seems unlikely.

There are (as far as I know) two types of "expat" job. The first is where a foreign company wants to have someone from Head Office on-site, and the second is where an expat has skills or experience that are not available locally. It is many years since Brits could work without an employment visa, and if you want to hire someone from abroad you already have to convince the Immigration Department that local candidates are not available before an employment visa will be issued (and rumour has it that a high salary makes it easier to convince them to grant the application). So why would anyone go to the trouble and expense of recruiting from abroad if there are local candidates who could do the job?

Not that you'd believe it from reading the letters in the SCMP. Here's Harry Chen, who seems to have a chip on his shoulder:

I believe that it is time for the glorified expat salary packages to disappear. It is true that they are important to attracting to Hong Kong staff with talent and expertise, but at the same time the companies providing these expat packages are guilty of racial discrimination. A local Hongkonger educated in an Ivy League university and fluent in four languages would not be eligible for the same generous expat salary package that an American, with a lower educational level and no Asian language skills, demands.

Ask yourself if having these overpaid staff actually helps the economic situation of your typical Hongkonger. An expat company vice-president in Hong Kong would still be a department supervisor if he or she had stayed in their home country.

Isn't this a myth? How many expat companies like that are there left in Hong Kong? Well, OK, there are a few companies left where all the top jobs go to expats, and very competent locals are stranded beneath the glass ceiling, but the good staff will leave and join employers who will give them more opportunities, and fewer and fewer companies can afford that luxury. Things are changing, and one high-profile example of this was Marks & Spencer, who decided to cut costs by getting rid of expat managers and 'localizing' instead. Hence you hear complaints from expats who find it difficult to get jobs because companies prefer locals (perhaps in the belief that expats expect higher salaries).

The fact is that the last ten years have seen a steep decline in traditional expat packages, and the main reason is the economy. As the economy picks up, a few companies will look abroad for staff with particular skills, but it seems very unlikely that we will ever see a return to the way things were ten years ago. There is absolutely no need for the government to legislate against expat packages, and I find it hard to believe that they would do so.


Five and a half

In Hong Kong it is common for offices to be open on Saturday morning, something that you would not find in the UK (or most other countries as far as I know), and hence we have public holidays on a Saturday (the cause of moaning from those who don't have to work on Saturday). In fact, it's not quite as bad as it might seem, because many people only have to work alternate Saturdays ("long week" and "short week").

However, I think that is a (very) gradual trend towards a five-day week. I know one company that used to open their office on Saturday but stopped doing so (though they asked staff to make up the hours during the week), and others that have "always" had a 5-day week. If you read the job adverts you will sometimes see this advertised as a benefit.

This week, Donald Tsang took everyone by surprise by announcing that the governments wants to introduce a five-day week for civil servants, but that they will still have to work 44 hours per week. Moving swiftly on without making any jokes about civil servants and work, this will surely accelerate the trend towards a five-day week in the private sector as well, which seems to have alarmed to "Pro-Business" lobby. Liberal Party leader James Tien rarely misses a chance to make a fool of himself, and this was a prime opportunity for him to say something stupid. He did not disappoint us (from The Standard):

James Tien, chairman of the pro-business Liberal Party, said the plan will create unnecessary pressure on the small-and-medium sized enterprises that account for about 90 percent of business firms in Hong Kong. "This will raise expectations of staff at private firms. And if some companies choose not to follow the government's system, they will easily be branded `unscrupulous employers'," he said.

Tien called for the government to rethink the system as he believed it could drive more workers to spend weekend holidays in the mainland and thus hurt the retail and catering industry.

The last comment is priceless. Over the last ten years, Hong Kong and China have become much closer - there is a significant trend towards Hong Kong people spending the working week in China, PRC residents come to Hong Kong for shopping, and Hong Kong people pop across the border for shopping, eating and all manner of other services. It benefits both Hong Kong and China.

Does he really think that if all Hong Kong people had a whole two days off every week, 90% of them would flood across the border on Friday night to return only on Sunday? It seems rather unlikely, and a moment's thought would tell him that there is hardly any difference between this and someone working in Hong Kong on Saturday morning and crossing the border the same afternoon.

Me, I'd welcome it if Hong Kong was a bit less crowded every weekend, but I can't see it happening.