Hong Kong civil servants to receive 3% pay increase despite fiscal challenges, impact exceeds HK$27 billion over past 3 years

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10th June 2024 – (Hong Kong) The Executive Council recently approved a uniform 3% pay increase for civil servants across all salary levels this year. Despite several civil service organizations expressing dissatisfaction and raising concerns about the fairness of a uniform pay raise, the government, after engaging in discussions with the employee representatives, emphasized the limited room for adjustment. If the pay raise is ultimately confirmed, it would mark three consecutive years of salary increases for civil servants, even in challenging economic conditions. According to government data, the cumulative impact of the salary adjustments over the past three years, including civil servants, Independent Commission Against Corruption personnel, employees of subsidised organisations, and auxiliary forces, amounts to over HK$27 billion.

While the announcement has stirred mixed reactions from various civil service unions, who argue that the uniform pay raise may not fully address the diverse needs and responsibilities of different positions, the government maintains that there is limited room for adjustment given the current circumstances. The decision takes into account factors such as public sentiment, the state of the economy, changes in the cost of living, and the well-being of civil servants.

Last month, the Pay Trend Survey Committee (PTSC) released the net pay trend indicators for this year’s civil service salary adjustments. The indicators were 4.01% for the upper band, 4.32% for the middle band, and 5.47% for the lower band. However, the Executive Council previously announced a uniform pay increase of 3% for civil servants across all salary bands, which still outpaces inflation. According to documents submitted by the government to the Legislative Council, the total amount involved in the 3% pay increase for civil servants, Independent Commission Against Corruption personnel, employees of subsidised organisations, and auxiliary forces amounts to HK$8.729 billion.

In the 2023-24 fiscal year, the net pay trend indicators for different salary bands were as follows: 2.87% for the upper salary band, 4.65% for the middle and lower salary bands. Last year, the government decided on a pay increase that aligned with the net indicators for the upper and middle bands and matched the 4.65% increase for the lower band. According to documents submitted to the Legislative Council, the additional expenditure resulting from the salary adjustment last year amounted to HK$5.218 billion.

The pay raise last year was higher compared to the previous year, namely the 2022-23 fiscal year. The net pay trend indicators for that year were 7.62% for the upper band, 4.55% for the middle band, and 2.04% for the lower band. The increase for the upper band sparked significant controversy and was criticised as being “excessive.” Ultimately, the Executive Council approved a uniform pay increase of 2.5% for civil servants across all salary bands, with a total expenditure of HK$6.803 billion.

The immense scale of the civil service in Hong Kong cannot be overlooked. With over 190,000 employees and a vacancy rate of nearly 2,000 positions, the civil service constitutes approximately 4.5% of the city’s total workforce. Furthermore, when factoring in subsidised organization employees, the percentage rises to a staggering 18.6%. This highlights the significant role civil servants play in the local economy.