Cheung Chor Yung Quest for Good Governance Principal Officials Accountability System

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CHINA:AN INTERNATIONAL JOURNAL 1, 2 (SEP. 2003): 249 272 249

THE QUEST FOR GOOD GOVERNANCE

The Quest for Good

Governance: Hong KongsPrincipal OfficialsAccountability System

CHEUNG Chor-yung

The second Tung Chee-hwa Administration in Hong Kong introduced thePrincipal Officials Accountability System (POAS) in July 2002 to enhance

the quality of governance and accountability of its principal officials. Ateam of politically appointed principal officials replaced senior career civilservants as final decision-makers in the government. The co-option of twopolitical party chairmen into the cabinet heralds the beginning of coalitionpolitics, whereby the executive branch attempts to forge an alliance with

some political parties in the legislature. However, owing to theundemocratic nature of the POAS, in which principal officials are

responsible to the Chief Executive, not the public, it is doubtful if thePOAS will improve the quality of governance in Hong Kongs open and

pluralistic society.

The government of the Hong Kong SpecialAdministrative Region (HKSAR), in the name of enhancing the quality

of governance, implemented a new Principal Officials AccountabilitySystem (POAS) on 1 July 2002, the very day Tung Chee-hwa commencedhis second five-year term as Chief Executive of the HKSAR. Under the

ABOUT THE AUTHOR

Cheung Chor-yung ([email protected]) is a senior lecturer in the Division of Social

Studies at the City University of Hong Kong. He is currently registered in a PhD

programme at the University of Hull, UK. His thesis is on politics and the idea of civil

association. His major research areas are Hong Kong politics and modern political theory.


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POAS, all principal official positions of department secretaries and bureaudirectors are no longer employed on civil service terms. Rather, they areregarded as political appointees nominated by the Chief Executive and

appointed by the Central Peoples Government on non-civil service contractualterms. They are responsible for the policy outcomes of their respective policyportfolios.1

According to this new system, the Chief Executive can nominate candidatesfrom both inside and outside the civil service for appointment to these principalofficial positions. In the end, three department secretaries and 11 bureaudirectorships were created under the POAS, of which six directors were selectedfrom the civil service and five from other sectors.2

The government explicitly stipulates that all principal officials under thePOAS may be forced to step down in the event of serious policy failures orgrave personal misconduct. However, it has not defined precisely whatconstitutes serious failures and has maintained that the legislatures vote ofno confidence against a principal official has no constitutional binding authorityto sack the official concerned. Moreover, according to Article 48(5) of the BasicLaw, the HKSARs mini constitution, only the Chief Executive has theconstitutional power to nominate the principal officials for appointment orremoval. In this paper, I argue that this provision is inadequate and less than

persuasive.The POAS also brings major changes to the Executive Council (Exco),Hong Kongs final decision-making body, and to the higher civil service. Allprincipal officials under the POAS are now appointed to the Exco, and theExco Secretariat is absorbed by the Chief Executives Office, which is headedby a directorate grade level eight (D8) political appointee holding the title ofDirector of the Chief Executives Office who, in effect, is the Secretary to the

1 According to Article 48(5) of the Basic Law, the principal officials of the HKSAR

government are the Secretaries and Deputy Secretaries of Departments, Directorsof Bureaux, Commissioner Against Corruption, Director of Audit, Commissioner

of Police, Director of Immigration, and Commissioner of Customs and Excise.

The POAS applies only to secretaries of departments and directors of bureaux who

are policy makers under the leadership of the Chief Executive. The other principal

officials are still manned by civil servants whose offices fall outside the ambit of the

POAS.2 For details of the governments proposal, see Legislative Council Paper: Accountability

System for Principal Officials, Constitutional Affairs Bureau, 17 Apr. 2002.


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Exco and is responsible for the running of the Chief Executives Office andgovernment secretariats public relations activities.

With respect to the higher civil service, those in the most senior rank (i.e.,

the D8 rank) of the civil service posts in the bureau are now designated aspermanent secretaries. They are tasked with assisting the bureau directors in policyformulation, implementation, and administration of the government agenciesconcerned. The government also reiterates its commitment to a permanent,meritocratic, and politically neutral civil service.

The Political Implications of the Principal OfficialsAccountability SystemWhile the introduction of the POAS does not require any amendmentsto the Basic Law, it has, in fact, brought some fundamental changes to thepolitical system of Hong Kong. First, with the political appointments of themost senior policy makers to the Hong Kong government, it heralded the endof Hong Kongs rule by senior civil servants. A corollary of this is that for thefirst time in Hong Kongs modern history, there is a political leadership teammanned by full-time politicians who share the same political platform. No longerwill senior civil servants be required to wear simultaneously the hats of policymakers and policy administrators. Under the POAS, all policy-making principal

officials are appointed to the Exco, transforming it from a largely advisory andamateur body into a cabinet type decision-making body no longer dominatedby part-time unofficial members. Instead, apart from the Chief Executive asthe chair, the new Exco has only five unofficial members amidst 14 officialmembers.3

The newly-revamped Exco, also for the first time, allows local partychairmen to be its members. James Tien Pei-chun, Chairman of the pro-business Liberal Party, and Jasper Tsang Yok-shing, Chairman of thepro-Beijing Democratic Alliance for the Betterment of Hong Kong (DAB),

are now unofficial members of the Exco. In Hong Kongs so called executive-led government system, in which the power to initiate policy is concentrated inthe hands of the Chief Executive who by law cannot come from any politicalparty,4 local parties in the past could only exert their formal influence in the

3 In the past, apart from the Chief Executive, only the three secretaries of departments

were Exco members along with 11 or 12 unofficial members.4 Section 31 of the Chief Executive Election Ordinance (Cap. 569 of Laws of Hong Kong).


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fragmented legislature.5 Before the introduction of the POAS, party members,like the DABs former Vice Chairman Tam Yiu-chung, appointed to theExco had to give up their leadership position in their political parties and

join the Exco in their personal capacity. However, with the appointment ofthe two political party chiefs to the Exco, the situation has fundamentallychanged.

Both Tien and Tsang are members of the Legislative Council (Legco) andare bound by the Excos principle of collective responsibility, thus making itobligatory for them to vote for the government in the Legco once the Exco hastaken a decision. Together their parties command 18 votes (10 for the DAB and8 for the liberals) out of 60 in Legco and form the largest voting bloc in thelegislature.

The co-option of Tien and Tsang to Exco is the clearest sign so far thatHong Kong is moving towards coalition politics by allowing pro-governmentlocal political parties to share the power of the executive. In fact, anotherLiberal Party member, Henry Tong Ying-yen, has become the Secretary forCommerce, Industry, and Technology, making the Liberal Party the firstparty in Hong Kong to have a member holding executive power in thegovernment. While it is still too early to say whether such a development isa harbinger of the emergence of a ruling party in the HKSAR, this

coalition politics will certainly encourage a clearer distinction between anti-government parties like the most popular Democratic Party and the Frontier,and the pro-government parties like the DAB and Liberal Party.6 In the

5 Owing to a number of constitutional and institutional constraints, like the

inability of members of the legislature to move a private members bill of any

significance, the split voting arrangement between the directly-elected members

and functional constituency members on members initiated proposals, the absence

of a legislative committee system similar to that of the US, and the adoption

of the proportional representation system in the geographical constituency elections,Hong Kongs legislature is highly fragmented with no dominant party. For a good

discussion of this, see Kuan Hsin-chi, Election without Political Clout, in Power

Transfer and Electoral Politics: The First Legislative Election in the Hong Kong Special

Administrative Region, ed. Kuan Hsin-chi, Lau Siu-kai, Louie Kin-sheun, and

Timothy Ka-ying Wong (Hong Kong: Chinese University of Hong Kong Press,

1999), ch. 10.6 The Democratic Party has 12 legislators and is the largest party in the HKSAR in terms

of electoral support and number of seats held in the Legco.


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Legco, therefore, even the rare cooperation between pro-government partiesand anti-government parties on some livelihood issues is now replaced by aclear adversarial relationship between the two sides, with the government

enjoying more secure support by the pro-government parties7 as well as thepro-business sectors members of the Legco who are returned by the functionalconstituencies.8

The creation of 14 politically-appointed top policy makers (who are in effectHong Kong-style ministers) in the POAS is followed by a parallel developmentin the civil service: the creation of the D8 rank permanent secretaries in thepolicy bureaux to assist in policy making and implementation, and in administeringthe respective government departments and agencies. These permanent secretariesare to be informed and advised by the most senior civil servants who will remainpolitically neutral.9 There is a clear intention to demarcate policy fromadministration with a view to restricting political responsibilities in policy makingto the secretaries of departments and bureau directors, and maintain the politicalneutrality and meritocratic tradition of the civil service. Such a demarcation notonly necessitates the development of political accountability among the principalofficials, it equally requires the civil service to nurture a clear concept and practiceof political neutrality, in order to ensure the integrity of a meritocratic and

7

In an editorial after the introduction of the POAS, South China Morning Post(16 Jul. 2002, p. 15) made the following observation: Since the new arrangements

took shape on Jul. 1, two major bills have been passed, one on cutting civil service

pay and one on anti-terrorismWhat has changed is that legislators whose chiefs

have been co-opted by Mr Tung have made a more concerted effort to defend the

government, while those from other parties have taken on a clearer role of being

the opposition.8 In the 2000 Legco elections, half of the seats (i.e., 30) in the HKSARs Legco were

returned by functional constituencies, in which only members (mostly corporate

members) of those constituencies had the right to vote. Most of these constituencies

came from the business and professional sectors and their political stances are more

conservative than liberal. Only 24 seats belonged to the geographical constituencies, in

which universal suffrage was adopted by using the proportional representation system.

The six remaining seats were returned by the 800-member Election Committee, which

was boycotted by the democrats who support universal suffrage for all Legco seats as

soon as possible.9 Before the introduction of the POAS, the D8 rank in the civil service was the most senior

administrative officer rank, the holders of which normally filled the policy secretary (i.e.,

director of bureau) positions.


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permanent civil service, and not overstep the political territories of the principalofficials.10

Critics of the POAS, however, argue that it is, in effect, a step backwards

for democracy. Increased accountability to the Chief Executive who has nopopular mandate will only increase the power of the Chief Executive, not thepolitical accountability of the decision makers. Martin Lee Chu-ming, the thenleader of the Democratic Party, describes the POAS as government by theChief Executives puppets.11 Emily Lau Wai-hing, a member of the Frontier,contends that, as the principal officials under the POAS are not elected by thepeople and are not responsible to the elected Legco, describing such a systemas an accountability system is misleading if not deceitful.12 To these critics,the ministers under the POAS may be more eager to go out of their officesand listen to the publics views on public affairs, but all they actually seek to dois to manipulate the public and media, and use so-called public opinion pressureto bring the elected Legco to heel rather than pursue genuine politicalaccountability.

Strictly speaking, it is premature to make any definitive judgement onwhether the newly-introduced POAS will succeed in its quest for improvingthe quality of governance. However, it does not follow that we cannotcarry out an informed analysis of the POAS to assess if its proposed changes

are consistent, conceptually as well as institutionally, with its manifestedprinciples of accountability and political neutrality. Likewise, in the light ofthese manifested principles, one can also ask if the proposed institutionalchanges are adequate, or whether there are better or additional institutionalarrangements to fulfil these requirements. Since the critics of the POAS haveraised a fundamental query over whether accountability can survive withoutdemocracy, a more in-depth look at the question of democratic accountabilityis called for.

10 Ian Scott, however, made this observation about the pre-1997 Hong Kong civil service:Civil service neutrality in Hong Kong is a myth. But it is a myth to which the

principal players in the transition to Chinese sovereignty find in their interests to

subscribe. See his article Civil Service Neutrality in Hong Kong, in Democratization

and Bureaucratic Neutrality, ed. Haile K. Asmerom and Elisa P. Reis (London:

MacMillan Press and New York: St. Martins Press, 1996), p. 277.11 See Democratic Partys official publication Outspoken (in Chinese), no. 44 (Nov. 2001): 2.12 Emily Lau, Why We Wont Get Accountability, South China Morning Post, 28 May

2002, p. 14.


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Accountability as Sanction While the HKSAR government and its critics have diametrically oppositeassessments of the impact of the POAS on the quality of governance, they

appear to share one common proposition: that accountability is mostmeaningful if it is related to sanctioning incompetent policy makers. Thereare different levels13 and different aspects14 of accountability in general politicaldiscourse. In the context of the POAS, most people appear to agree that itmeans the existence of an authority to which an individual or body is subject,and by which the individual or body concerned can be controlled, even removedfrom office. A major difference is that the government takes accountability tomean that the ministers are responsible to the Chief Executive who is notreturned by universal suffrage, while the democrats argue that it should meanthat the ministers are responsible either to the people directly, or to the electedLegco.15

13 For example, in a paper on the POAS entitled How to Take Governance Reform

Forward: Accountability to Whom and How? by the SynergyNet, a policy

thinktank in the HKSAR, it is pointed out that four separate notions are central to

the overall concept of accountability: (1) answerability, meaning the obligation

to provide an answer or response to questions raised; (2) accountability in the

narrow sense, meaning the obligation to account for ones actions; (3) responsiveness,meaning the willingness to respond to demand and call for action accordingly;

and (4) responsibility, meaning the obligation to take action or carry out a duty

and the liability to get blamed for ones action or non-action. See pp. 78 of the

paper.14 Joseph G. Jabbra and O. P. Dwivedi, Public Service Accountability: A Comparative

Perspective(Connecticut: Kumarian Press, 1988). On pp. 58, they identify the following

aspects of accountability: administrative/organisational, legal, political, professional, and

moral.15 It should be noted that Article 64 of the Basic Law stipulates that the HKSAR

government must abide by the law and be accountable to the Legco in terms of

implementing laws passed by the Legco, presenting regular policy addresses to it,

answering questions raised by Legco members, and obtaining approval from the Legco

for public expenditure and taxation. It is obvious that in this context, accountability

does not involve the ability to impose sanctions and is therefore quite distinct from the

concept of accountability as used in the context of the POAS. As mentioned before,

there are different levels as well as types of accountability. It is therefore important not

to assume that throughout the Basic Law, there is only one meaning to the concept of

accountability applicable to it.


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While there is no dispute that effective accountability must involve theability to sanction policy makers, it is equally obvious that sanctions alone cannotexhaust the requirements of effective accountability. As John Uhr, an Australian

scholar on public service and deliberative democracy, notes, two prerequisitesare required for effective accountability: first, mechanisms for providinginformation; and second, mechanisms for imposing sanctions.16 The pointof deliberation and information is discussed in the next section. Meanwhile,let us concentrate on whether the governments proposals for principal officialsto be totally responsible to the Chief Executive for the outcome of theirrespective policy is conceptually, constitutionally, and institutionally tenable oradequate.

The government itself admits that since the reunification with China in1997, there has been a big change in Hong Kongs political ecology in the sensethat government policy and operation are increasingly subject to the criticalscrutiny of the public, media, and elected Legco. There have even been calls forsenior officials to step down and take responsibility for their policy failures.17

One would have thought that if the government really takes its words seriously,a conceptually-logical conclusion is to introduce an accountability system wherebythe public or the elected Legco can impose direct sanctions against those who areresponsible for their policy failures. But that was not what the government

proposed. Instead, the government says that all principal officials are accountableto the Chief Executive, who is selected only by a small circle 800-memberelection committee, and can only be removed by him, though it admits that it isimportant to listen to the views of the public.

16 John Uhr, Deliberative Democracy in Australia: The Changing Place of Parliament

(Cambridge: Cambridge University Press, 1998), p. 163.17 For example, in the summer of 2001, legislators were very dissatisfied with the fact that

the then Director of Housing Tony Miller could still maintain his position after the Legco

had passed a motion of no confidence in him in the so-called short pile scandal, inwhich some public housing built by the Housing Authority failed to meet construction

safety standards due to corruption. In another case, many people demanded the resignation

of Chief Executives Personal Assistant Andrew Lo Cheung-on, after he was found by an

inquiry headed by a judge as a poor and unreliable witness to the so-called Chung

Ting-yiu Incident, in which Lo was accused of attempting to undermine academic

freedom by indicating to the then Vice-Chancellor of the University of Hong Kong that

the Chief Executive was unhappy about Chungs survey on his popularity. The government

refused to let Miller and Lo resign on the grounds that they were civil servants and

responsible for administrative, not political, errors.


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One may argue that given the present executive-led requirements of theBasic Law, in which only the Chief Executive can nominate principal officialsfor appointment, it is constitutionally not possible to allow the elected Legco

or the people to sanction the principal officials directly. While it is true thatArticle 48(5) does specify that nomination for appointment and removal ofprincipal officials are powers vested in the Chief Executive, one should notoverlook the fact that in the HKSARs executive-led system, it is also intendedthat the Legco somehow has a final check and balance function against theexecutive in order to prevent predominance of the executive over other parts ofthe political system. This can most clearly be seen in paragraphs (2) and (3) ofArticle 52 of the Basic Law.

Article 52 stipulates three different circumstances under which the ChiefExecutive must resign, and paragraphs (2) and (3) are related to this check andbalance function between the Chief Executive and the Legco:

The Chief Executive of the Hong Kong Special Administrative Region must

resign under any of the following circumstances:

(1)

(2) When, after the Legislative Council is dissolved because [the Chief Executive]

twice refuses to sign a bill passed by it, the new Legislative Council again passes

by a two-thirds majority of all the members the original bill in dispute, but [theChief Executive] still refuses to sign it; and

(3) When, after the Legislative Council is dissolved because it refuses to pass a

budget or any other important bill, the new Legislative Council still refuses to

pass the original bill in dispute.

Commenting on these two paragraphs of Article 52, Xiao Wei-yun, a Basic Lawdrafter and Mainland authority on the mini-constitution of the HKSAR, says itis very appropriate to require the Chief Executive to resign under these two

circumstances, for the Chief Executive, in those cases, not only has lost the supportof the first Legco in question, but the newly-elected second Legco also finds itdifficult to support him. In light of this, he believes that the Chief Executive hasalready lost the confidence of the legislature and the only way to solve thisconstitutional deadlock and allow the legislature to check the executive power isfor the Chief Executive to resign.18

18 Xiao Wei-yun, ed., One Country Two Systems and the Basic Law of the HKSAR (Hong

Kong: Cultural and Educational Publications, 1990), p. 181 (in Chinese).


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It is clear from Xiaos comments that while the Chief Executive in theHKSARs executive-led system enjoys the most power in the area of policy-making, according to the constitutional principle of the Basic Law, he must resign

if he ultimately loses the confidence of the legislature because the legislature isthere to avoid the predominance of the executive.19 It is true that the ChiefExecutive enjoys great advantage in the event of a constitutional confrontationwith the Legco in relation to paragraphs (2) and (3) of Article 52, for he has thepower to dissolve Legco first. However, the Chief Executive requires the supportof the legislature to remain in office and he cannot, according to the Basic Law,dissolve the Legco more than once in each term of his office.20

With the introduction of the POAS, what is the constitutional role of theLegco in checking the executive and maintaining its confidence in the ChiefExecutive in light of a reasonable principle of accountability? To answer thisquestion, we must first realise that there is a distinction between when anindividual minister is at fault, and when the government as a whole is at fault.Although all principal officials in the POAS are required to adhere to the Excoscollective responsibility for overall government decisions, it is clear that eachminister is first and foremost required to take his responsibility within hisdesignated portfolio most seriously. If it is the Chief Executive or the governmentas a whole that fails to gain the confidence of the legislature, then we shall

follow provisions in Article 52 to hold the government or Chief Executiveresponsible. However, in the case of an individual principal officials failure, itis either up to the Chief Executive to exercise his power to remove the officialconcerned, or, if the pressure comes mainly from the Legco, a vote of noconfidence would be the clearest sign that the individual official has alreadylost the confidence of the legislature. He is therefore required to resign or beremoved by the Chief Executive, unless the Chief Executive is prepared toregard the officials failure not as his individual failure, but the governmentsresponsibility and risk Legcos sanctions in accordance with Article 52 of the

Basic Law. If a minister loses the confidence of the Legco, it is almost impossiblefor him to perform his duties as a government principal official, for anylegislation or government measure that falls into his portfolio is unlikely to bepassed by the legislature. If he still refuses to resign, the confrontation willeasily escalate from an individual level to the administration as a whole.

19 See Xiaos article On the Basic Principles of the Political System of the Basic Law,

a speech delivered by Xiao in Hong Kong, 4 Apr. 2002 (in Chinese).20 Article 50 of the Basic Law.


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It seems obvious that the rationale for introducing the POAS is first andforemost to enhance the accountability of principal officials as individualministersto their respective policy portfolios, for it is each and every one of them, not the

administration as a whole, that is accountable to the Chief Executive for anypolicy failure. It is unreasonable to expect that the Chief Executive should riskthe Legcos or publics confidence in his whole administration every time anindividual minister has difficulties in gaining the confidence of the Legco or thepublic. As such, it is reasonable to expect that the Legco should play an importantrole in sanctioning incompetent principal officials to check executive power, avoidconstitutional confrontation with the Chief Executive, maintain its confidencein the Chief Executive, and enhance the principal officials accountability to theLegco. It is reasonable to expect that the spirit of Article 52 of the Basic Lawrequires the POAS to develop a set of constitutional conventions whereby Legcossupport is required in order for a minister in trouble to remain in office. This willrequire the development of some institutional mechanisms to deal with situationslike this, and it seems that some form of individual ministerial responsibilityprinciples developed by conventions together with an adequately drafted code ofministerial conduct is required.

Individual ministerial responsibility is a constitutional conventiondeveloped in the Westminster type of parliamentary government, in which each

individual government minister is responsible to parliament for his policy areas.He is required to resign by the Prime Minister, or by parliament, if he hascommitted serious policy mistakes or grave personal misconduct. GeoffreyMarshall, the leading British expert on constitutional conventions, says thatconventions are set by a series of precedents, by agreements among the majorpolitical players, or by justified government principles like democracy orconstitutionalism.21Though Hong Kong does not have the Westminster typeof parliamentary government, if the POAS is to work and be compatible withthe spirit of Article 52 of the Basic Law, it is crucial that some form of individual

ministerial responsibility be developed. It should be established by precedent,i.e., the conscious principles decided by the political players in Hong Kong,

21 See his Constitutional Conventions: The Rules and Forms of Political Accountability

(Oxford: Clarendon Press, 1986), reprinted edition, particularly ch. IV Doctrine of

Ministerial Responsibility. For a very good account of the application and

development of individual ministerial responsibility in the United Kingdom during

1980s and 1990s, see Diana Woodhouse,Ministers and Parliament: Accountability in

Theory and Practice(Oxford: Clarendon Press, 1994).


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and by the constitutional spirit of open and accountable government todetermine each individual ministers political and administrative responsibilities.It should stipulate clearly the conditions under which the minister should be

held partially or totally responsible for policy failure.Apart from the undemocratic nature of the POAS, another major

inadequacy of this proposal is its failure to acknowledge the need to developa clear concept and set of principles for individual ministerial responsibility.At the moment, the government uses only very general terms in its paper onthe POAS to state that principal officials are required to step down in extremecases of policy failure or grave personal misconduct.22 In the governmentsCode for Principal Officials under the Accountability System, the governmentsays, principal officials are responsible for formulating, explaining anddefending government policies as well as canvassing support from the publicand Legislative Council. They are accountable to the Chief Executive for thesuccess or failure of their policies.23 All these statements are far from adequatein forming a foundation for the development of individual ministerialresponsibility.

SynergyNet, a Hong Kong liberal policy thinktank, made a good suggestionin a recent policy paper by putting forward some relatively specific guidelines todetermine when a principal official should tender his resignation:

Principal officials are expected to tender resignation from office to takeresponsibility for:

a major policy error or failure in policy administration within their portfolio

which has caused significant damage to the public interest or the publics

trust in the government; or,

a serious failure in supervision over their bureau or subordinate departments

or agencies in policy implementation, which has resulted in significant damage

to the public interest or the publics trust in the government; or,

any act which has grossly harmed the reputation and integrity of the

government.24

22 Accountability System for Principal Officials.23 Code for Principal Officials under the Accountability System, Chief Executives Office,

G.N. 3845, 28 Jun. 2002.24 See p. 26 of the SynergyNet report mentioned in note 14. For another comment on

the POAS by another local thinktank, Civic Exchange, see its report Accountability

without Democracy: The Principal Officials Accountability System in Hong Kong, at

.


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However, even criteria like these are not sufficient to determine theboundaries of individual ministerial responsibility. A study by Diana Woodhouse,an expert on the United Kingdoms individual ministerial responsibility, shows

that in addition to the constitutional aspect, there are always political factors inthe determination of what constitutes a major error or serious failure. Therole of the Chief Executive, Legco, and public opinion and their interaction arecrucial in the determination of the contents and meanings of these unspecifiedwords in the dispute concerned.25 Also, questions such as whether the ministershould be responsible for grave administrative errors made by the civil servants ofhis department without his prior knowledge, or the so-called vicariousresponsibility of a minister, are always to a certain extent, open and subject to thepolitical judgement of the day.

In this regard, the so-called penny stocks fiasco which erupted less thana month after the introduction of the POAS ( July 2002) helps reinforce theclaim that there is an urgent need to develop a proper framework for individualministerial responsibility. According to one estimation, the local stock marketlost HK$10 billion (US$1.28 billion) in value in one trading day. The apparentcause for the panic selling of penny stocks was the regulatory authoritiesconsultation paper, in which it was proposed that stocks trading below 50 HongKong cents for 30 consecutive days would need to consolidate their shares or

face de-listing. It was implemented with insufficient attention paid to possiblemarket reactions, for almost half of the stocks trading in Hong Kongs stockmarket may be defined as penny stocks. Though the consultation paper aimedto improve corporate governance in Hong Kong, it failed to provide alternativemeans for small shareholders of these stocks to trade their stocks once theywere de-listed by the authorities as proposed. Adding salt to the wound wasthe fact that it was released when the stock market was in its most bearishmood since the last global stock slump following the 11 September 2001 terroristattacks in the US.26The Hong Kong Exchanges and Clearing (HKEx), which

issued the consultation document, and its supervisory body, the Securities andFutures Commission (SFC) immediately shelved the proposals after the panicselling. Meanwhile, legislators, the press, public, and government officials fiercelydebated whether apart from the Chief Executive of the HKEx, Kwong Ki-chi,and the Chairman of the SFC, Andrew Sheng, who were directly or indirectlyresponsible for the implementation of the consultation exercise the ministers

25 Woodhouse, Ministers and Parliament, particularly pp. 1628.26 For details of this saga, see South China Morning Post, 1 Aug. 2002.


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who had overall responsibility for financial services policy (i.e., the FinancialSecretary (FS) Anthony Leung and the Secretary for the Financial Servicesand Treasury (SFST), Frederick Ma) should also bear responsibility. Yet,

the latter two claimed that they did not have prior knowledge of the contentsof the proposals concerned and were not directly involved in this kind of marketregulatory activity which enabled market professionals, not the government, toregulate their day-to-day operations.

Judging from the responses of, and measures adopted by, the government inthis incident there is still a long way to go before the political establishment candevelop a relatively comprehensive and mature concept of individual ministerialresponsibility for the enhancement of officials accountability.27 Three pointsshould be noted here:

First, it is strange for the fact-finding inquiry panel, set up by the FS andcomprising two independent members, to make judgements exonerating the FSand SFST from any ministerial faults, for these are constitutional as well aspolitical, not administrative issues to be decided by the government, Legco, andthe public.28 It is equally strange for the government to follow those judgementsas if the panel has the authority to do so.29

Second, the kind of responsibilities examined by the panel, namely policy,executive, systematic, and personnel responsibilities, are far from complete.30The

most notable responsibilities that are missing in the Report are the responsibilityof oversight and the vicarious responsibility of the ministers concerned fordepartmental faults. Though both the FS and SFST were not directly in chargeof the consultation, they oversaw (since the consultation fell within the ambit oftheir respective policy portfolios), and were indirectly responsible for, any mistake

27 The government set up a two-member panel to examine the incident. Robert G.

Kotewall and Gordon C. K. Kwong, the members, submitted the Report of the

Panel of Inquiry on the Penny Stocks Incident (the Report) to the government in

Sep.2002, in which they argued that no principal officials should be made responsiblefor the incident. For a more detailed analysis, see my contribution on departmental

faults and vicarious responsibility of the ministers published in the Forum Section

ofMing Pao, 6 Aug. 2002, p. D15 (in Chinese) and The First Test of Ministerial

Responsibility in Hong Kong: Some Thoughts on the Penny Stocks Fiasco at

(in English).28 Report of the Panel, ch. 12.29 See the local press reports such as in South China Morning PostandMing Pao, 11 Sep.

2002, the day after the release of the Report of the Panel.30

Report of the Panel, para. 12.16, p. 156.


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made by their subordinate bodies tasked with carrying out the policy. It is absurdfor the panels report to claim that the SFST did not have oversight responsibilityover non-government departments, as it is impossible for the SFST to carry out

his duties if he does not have the power and responsibility to make sure thatstatutory bodies like the SFC follow his policy instructions and implement themfaithfully and professionally.31

Third, while the FS and SFST should not resign as a result of this fiasco, itis wrong to argue that the SFSTs failings were mainly his sub-par performanceat the Legco Panel meeting on 31 July 2002 and conclude that the SFST shouldnot be held partially responsible for the fiasco.32 At that meeting, the SFST revealedthat his office was informed of the main points of the consultation exercise in theform of a SFC summary in advance, but he failed to take note of them at thattime as he was too busy dealing with other things. This failure also made himmislead the FS, who, based on this piece of misinformation, told the press onrecord that the government should not be held responsible as the HKEx or theSFC did not inform it of the contents of the consultation document in advance.Such a failure clearly points to the conclusion that the SFST was less thancompetent in exercising his responsibility, and together with his role in misleadingthe FS and public, should be held indirectly responsible for the fiasco. However,as constitutional convention scholars like Marshall and Woodhead have shown,

indirect or vicarious responsibility alone seldom merits ministerial resignationeven in a parliamentary system.33

In sum, it seems clear that the current POAS as introduced by the HKSARgovernment is highly inadequate in terms of providing political and institutionalguidance for enhancing ministerial accountability, and there is a lack of developedconstitutional conventions to assist policy makers, politicians and the public todeal with issues related to ministerial responsibility. In this regard, for students ofpolitics and public administration, this creates a vast new academic area for themto pioneer research projects on the theory and practice of ministerial responsibility

in the context of Hong Kongs one country, two systems.

Accountability and Deliberation The above section deals with one important aspect of accountability accountability as sanction. However, there is another equally important aspect of

31 Report of the Panel, pp. 4950.32 Ibid., p. 159.33 Marshall, Constitutional Conventions; Woodhouse,Ministers and Parliament.


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accountability that falls within what James G. March and Hohan P. Olsen call alogic of appropriateness:

Many of the complications surrounding the accountability of political actors stem

from an interweaving of the two standard logics of human action a logic of

consequence and a logic of appropriateness

A-logic-of-appropriateness frame for accountability leads to demands that political

actors be accountable for the appropriateness of their actions. Behaviour is assessed

as proper, less because of its consequences than because of its consistency with

cultural and political norms and rules.34

How does the POAS fare in this logic-of-appropriateness aspect of accountability?In a sense, the requirement of resignation for grave personal misconduct

certainly falls within this aspect of accountability, for this kind of misconductundoubtedly is inconsistent with the moral norms of society. However, what isalso being neglected in the whole discussion of the POAS so far is whether thegovernment has put in place mechanisms or measures to ensure that the actionsof principal officials are consistently in accordance with the requirements of anopen, liberal, and civilised society like Hong Kong.35

Under the POAS, principal officials must be dedicated to their duties, upholdthe rule of law, abide by the law (including the legislation against corruption), act

in the best interests of the HKSAR, be as open as possible about their decisions,avoid conflicts of interest, promote political neutrality and the meritocratictradition of the civil service, and so on. All these requirements are enshrined inthe governments code for principal officials.36 However, in some crucial areas (orwhat John Uhr calls the arenas of accountability), the measures proposed underthe POAS are far from adequate.37

One of the avowed objectives of the POAS is to improve the workingrelationship with the legislature.38 Yet, there are very few additional proposed

34 James G. March and Johan P. Olsen, Democratic Governance(New York: The FreePress, 1995), p. 154.

35 To March and Olsen, the logic of appropriateness will require the government to gain the

informed consent of its citizens by adopting coercion-free persuasion through the offering

of good reasons, arguments, and moral appeals, and the evoking of shared cultural standards

and the rule of law.Ibid.36 Code for Principal Officials under the Accountability System.37 Uhr, Deliberative Democracy in Australia, particularly ch. 8.38 Accountability System for Principal Officials, paragraph 2(k).


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measures to improve the quality of exchanges between the government andlegislature, or to promote the Legcos capacity to better scrutinise governmentproposals under the POAS.39Yes, the Chief Executive, after the introduction of

the POAS, has agreed to appear before the Legco more often, from three times ayear in his first term, to at least four times a year. Yet this token increase is farfrom impressive, and in no way compares to the last Colonial Governor ChrisPattens monthly appearance before the Legco.

Already, there are signs that the government is becoming increasingly lessforthcoming in its dealings with the Legco. The President, Rita Fan Hsu Lai-tai,recently offered the opinion that the relationship between the government andLegco had worsened.40 According to Fan, this was so because legislators werenot happy with the administration over several incidents, including the ChiefSecretary for Administrations announcing of the resumption of sale of HomeOwnership Scheme flats to the media without first informing the Legco for fearof negative responses from members of the legislature, and the governmentsannouncement of awarding the Sha Tin-Central rail link project to the Kowloon-Canton Railway Corporation without informing the Legco first. Both incidentsoccurred after the government had made known its intention to introduce thePOAS, making one wonder whether bypassing the Legco and shunning publicexchanges with legislators would enhance effective accountability.

All these incidents and practices are inconsistent with the spirit ofaccountability, as understood in the sense of the logic of appropriateness. Althoughsome element of political and tactical consideration is unavoidable in anygovernment business, there are things that the government should do to ensurethat the POAS can improve the chance of getting the informed consent of thepublic or their representatives, or be held accountable for failing to do so.

The Chief Executive should appear far more often before the Legco toanswer members questions and promote better quality exchanges between thetwo parties. He should go to the Legco at least once a month, upon his return

39 The requirements in this respect as set in the code for principal officials contain

nothing new, for the need to present regular policy addresses to the Legco, answer

questions raised by Legco members, appear before the Legco or its committees,

subcommittees and panels, take part in Legco debates, or give accurate and truthful

information to the Legco are all standard requirements having been practised for a

long time in Hong Kongs legislature.40 May Sin-mi Hon, Legislators and Officials Both Blamed for Bad Blood, South China

Morning Post, 16 Jul. 2002, p. 6.


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from any major trip to Beijing or overseas, and when the government wantsto make important announcements or respond to major events. It would bevery difficult to argue that the Chief Executive takes accountability seriously

if he is unwilling to be seen as more accountable than a Colonial Governor.In addition, the government may revive the publication of the annual progressreport of government policy goals (which was discontinued after 1998) beforethe Chief Executive announces his annual policy address, so that the Legcoand the public can then have a clearer picture of the progress made by thegovernment in the previous year before commenting on new government policyinitiatives.

Other possible instruments for the enhancement of accountability in thisrespect include making the Director of Audit, Ombudsman, and Commissionerof Equal Opportunities, all of whom are now appointed or nominated bythe Chief Executive and are accountable to him, independent officers ofthe legislature. They should report directly to the Legco on their respectiveareas of responsibility, and together monitor whether the government hasconducted its business in these areas properly.41 This will enhance theindependence of these offices. The officials concerned will be free from anyundue executive interference and will be in a better position to assist theLegco in monitoring the governments performance in these areas.42 Other

measures like the introduction of a Freedom of Information Act can also beconsidered as a means of improving access to official information for effectiveaccountability.

The purpose of drawing attention to all these possible instruments forenhancement of accountability is not to say that all of them should or can beapplied to the HKSAR any time. The merits and suitability of each to HongKong deserves to be discussed in detail, but due to space constraints this cannotbe done in this paper. The point, instead, is to demonstrate that the POAS hasalmost totally neglected this important aspect of accountability and should

therefore be regarded only as an inadequate system for promoting accountability.John Dunn, the Cambridge political theorist, is quite right when he says, themain weight of democratic accountability has to fall here: on the attempt to

41 Australia made a similar proposal in relation to its Auditor-General. See Uhr,

Deliberative Democracy in Australia, p. 189.42 Article 58 of the Basic Law stipulates that the Commission of Audit be accountable to

the Chief Executive. Therefore, such a proposal, if adopted, will require amendments

made to the Basic Law.


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43 John Dunn, Situating Democratic Political Accountability, in Democracy,

Accountability, and Representation , ed. Adam Przeworski, Susan C. Stokes, and Bernard

Manin (Cambridge: Cambridge University Press, 1999), p. 339.44 See Kenneth Kernaghan and John W. Langford, The Responsible Public Servant(Halifax,

Nova Scotia: The Institute for Research on Public Policy, 1990), pp. 567.

maximise the degree to which politically consequential conduct by rulers andtheir subordinates is always in the open.43

Political Neutrality: A FrameworkThe success of the POAS does not depend on the enhancement of accountabilityamong principal officials alone. Equally important is whether the POAS canprovide a credible framework for the political neutrality of the civil service, forthe whole POAS undertaking is premised on the separation of politics fromadministration, and the principle of political neutrality is needed for themaintenance of a meritocratic and permanent civil service.

In this regard, the framework provided by the Canadian public administrationscholar, Kenneth Kernaghan, perhaps captures best the major aspects of politicalneutrality of the civil service, the main tenets of which are as follows:44

Politics and policy are separated from administration; thus politicians make

policy decisions, public servants execute these decisions;

Public servants are appointed and promoted on the basis of merit rather than

of party affiliation or contributions;

Public servants do not engage in partisan political activities;

Public servants do not express publicly their personal views on government

policies or administration;

Public servants provide forthright and objective advice to their political mastersin private and in confidence; in return, political executives protect the

anonymity of public servants by publicly accepting responsibility for

departmental decisions; and

Public servants execute policy decisions loyally irrespective of the philosophy

and programmes of the party in power and regardless of their personal

opinions; as a result, public servants enjoy security of tenure during good

behaviour and satisfactory performance.

In the past, the fusion of the political and administrative dimensions in the

upper echelon of Hong Kongs civil service did not sit comfortably with thiswidely-accepted constitutional convention of political neutrality. The introductionof the POAS is in effect an admission of this inherent mismatch between the


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civil service status of these officials and the political demands placed on them bythe government. However, whether the changes proposed under the POAS cansucceed in maintaining a politically-neutral civil service is, for reasons given below,

rather doubtful. Two problematic areas are discussed here.

The Post of Secretary for the Civil Service: Confusionbetween Political vs. Administrative ResponsibilitiesThe first problem relates to the political appointment of the Secretary for theCivil Service (SCS), whose main responsibility is to oversee the governmentspolicy and management of the civil service. Under the governments POASproposals, the Chief Executive will select among serving senior civil servants, thecandidate to fill the post of SCS. This person may, age permitting, return to thecivil service at the end of his tenure if he so chooses.

The government believes that such an arrangement has the merit of reassuringthe civil service that they will continue to be managed by a principal official whohas a link with the civil service. The government also thinks that this proposal willcombine the best of both worlds because as a member of the Exco, the SCS will bewell placed to ensure that the interests and concerns of the civil service will be fullyrepresented and taken into account before the government makes any major decision.On the other hand, the Secretary will bring his civil service experience and

perspectives to bear on decisions taken in the Exco, the outcome of which verymuch depends on the implementation process executed by the civil service.This is not very convincing as the SCS is apoliticalappointee fully responsible

for the political decisions taken by him individually, and for all government policiescollectively. As a politically-appointed principal official, his first and foremostduty is to honour, to the utmost of his ability, his political responsibilities. Nothingshort of a full commitment to his political duty should be expected from theSCS, and quite rightly so. In other words, the management, both generally andon a day-to-day basis, of the civil service, including proposals on promotion,

recruitment, transfer, career development, disciplinary measures, etc., will becarried out by a politician, not an administrator, whose first duty to the governmentis political. How can one be assured that the integrity and political neutrality ofthe civil service will be vigorously protected under such an arrangement?45

45 Can one be assured that the SCS, with his political responsibilities foremost in his mind,

will pursue vigorously a complaint of undue political interference (which could cause

political embarrassment to the government) from his civil service subordinate against

his political colleague in the Exco, to which he and his political colleagues share the

same collective responsibility?


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The fundamental problem with this arrangement is the fusion of politicaland administrative responsibilities in one office-bearer, for the SCS is not onlythe political master of his bureau, but also the manager of it. In the more traditional

approach adopted by the British government, the manager of the home civilservice (normally filled by the Cabinet Secretary) is himself the most senior civilservant responsible for the management of the civil service with the Prime Ministeras its political head. It is a better alternative both for conceptual clarity and forinstitutional protection of the civil services integrity and neutrality.46 In the caseof Hong Kong, the Chief Secretary for Administration or the Chief Executiveshould assume the political headship of the civil service responsible for civil servicepolicy, and an equivalent of the administrative head of the civil service should becreated to oversee the management of the civil service. He should be chosenfrom the most senior civil servants and abide by the regulations governing thecivil service. The seniority of the Chief Secretary for Administration or the ChiefExecutive should also reassure the civil service that their interests and concernswill be made known to the most senior level of the government.47

Problems with the Role of Permanent SecretariesUnder the POAS, permanent secretaries are the most senior civil servants and actas the interface between their political masters and the civil service. They are there

to advise the principal officers and the government on policy, and under theinstruction of the latter, explain and defend government policies in public and atLegco panel or committee meetings. They also supervise the daily functioning oftheir respective departments, manage the implementation of government policy asdecided by the Exco, and oversee the delivery of government service to the public.

Unlike their counterparts in the United Kingdom, permanent secretaries inHong Kong are required to defend government policy in public under theinstruction of their political superiors.48This apparently contradicts the anonymityrule of the civil service under the principle of political neutrality. While it should

be pointed out that senior civil servants are increasingly being asked to appear

46 For a good account of the headship of the British Home Civil Service, see Peter

Barberis, The Elite of the Elite: Permanent Secretaries in the British Higher Civil Service

(Aldershot: Dartmouth Publishing, 1996), pp. 1221.47 According to Article 53 of the Basic Law, the Chief Secretary for Administration (which

is called the Administrative Secretary in the Basic Law) in terms of seniority, is second

only to the Chief Executive in the HKSAR government.48 Accountability System for Principal Officials, p. 11.


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before parliamentary select committees to answer questions on behalf of thegovernment in the United Kingdom, they are not allowed to defend governmentpolicy in the parliament, for this is against the constitutional principle whereby

the government is accountable through its ministers to the parliament.49In Hong Kong, Article 64 of the Basic Law requires the government to

answer questions raised by Legco members. The executive regards this as aform of accountability to the legislature. But the Basic Law does not specifythat the HKSAR government shall be accountable through its principal officialsto the Legco. Therefore, the concern in this regard has less to do withconstitutional propriety than with the danger of confusing politicalresponsibilities with administrative ones. There is nothing wrong for permanentsecretaries and senior civil servants who are required to advise the governmenton policy to explain government policy before Legco committees or in public,so long as they are adhering strictly to the agreed official lines while carryingout this duty. However, once they are required to defend government policy,they will face questions related to the rationale of, and justification for, thepolitical decisions taken by the government, which are clearly beyond the scopeof their administrative duty.

In order for permanent secretaries to perform their duty as policy advisorsto their political masters, they must be able to give objective, professional, frank,

and non-partisan advice to the principal officials in confidence. As it is nowpossible for members of political parties to take up political appointment positionsunder the POAS, it is crucially important that the permanent secretaries canobtain policy advice, in complete confidence, from both their current politicalmasters as well as possible future ones who may be of different political persuasions.In other words, the rule of impartiality under the principle of political neutralityof the civil service must apply in policy advice, and the requirement to defendgovernment policy before the Legco and in public will certainly undermine thisrule, for it will inevitably make the civil servants look partisan. In addition, rules

must also be in place whereby access to the advice given by permanent secretariesor other senior civil servants to their political masters will be regulated so as notto bias future principal officials towards the personal views of the civil servants.Otherwise, it would be quite impossible for civil servants concerned to give frankand honest opinions to their political masters.

In his letter to all civil servants on 17 April 2002, the SCS, Mr JosephWong, says, The bounden duty of every civil servant is to be loyal to the Chief

49 Woodhouse,Ministers and Parliament, ch. 10.


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Executive and the principal officials of the day.50The first and foremost loyalty,under the principle of political neutrality, of any permanent secretary must be tothe principal official of his bureau. However, this does not mean that permanent

secretaries do not have responsibility to the government, Exco as a whole, orChief Executive, in particular. While the principle of collective responsibility inthe Chief Executive-in-Council is well established in Hong Kong, there are timesin which there may be clashes between different departments before a collectivedecision is taken, or when a collective decision is in doubt. Under thosecircumstances, where should permanent secretaries and civil servants loyalty lie?Nothing in the current Code for Principal Officials under the AccountabilitySystem has touched upon issues of this kind, and I believe that a code for thecivil service which gives directions to handle this kind of situation is needed.51

The principle of a politically-neutral civil service should not be construed soas to preclude senior civil servants from administrative accountability. In NewZealand, for example, public sector reform in the 1980s and 1990s turned thetraditional permanent secretaries of the civil service into chief executives ofgovernment agencies who are required by law to report to parliament on theoutputs, that is, the service or the goods they have delivered, of their department,while the ministers continue to be responsible for the outcomes of governmentpolicy in which the effects of the outputs of government service on the community

are assessed.52

On the other hand, in the United Kingdom, permanent secretaries,as accounting officers of their respective departments, are accountable and directlyanswerable to the Public Accounts Committee (PAC) of the House of Commonsfor the financial control of their departments. They are entitled to express inwriting to the minister any disagreement concerning proposals for spending thatthey believe they cannot justify before the PAC. Such opinions will be passed onto the Comptroller and Auditor General who has the statutory responsibility toreport to Parliament on the economy, efficiency, and effectiveness of governmentdepartments.53

50 See LC Paper No. CB (2)1650/0102(05).51 For a discussion of the merits of adopting a code of practice for civil service to enhance

public service accountability, see Kenneth Kernaghan, Promoting Public Service Ethics:

The Codification Option, inEthics in Public Service, ed. Richard A. Chapman (Edinburgh:

Edinburgh University Press, 1993), ch. 3. For suggestions concerning the adoption of a

civil service code in Hong Kong, see SynergyNets report, pp. 256.52 Woodhouse,Ministers and Parliament, pp. 26870.53 Ibid., pp. 2403, and Barberis, The Elite of the Elite, ch. 4.


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Overseas experience of the above-mentioned kind is applicable to HongKong. Incidents such as the penny stocks, show that for an accountability systemto succeed, Hong Kong must urgently attempt to demarcate adequate boundaries

between political and administrative accountability and develop an appropriateframework for the latter in order to deal with the issues of accountability relatedto administrative heads of public agencies (like the Chief Executive of the HKExin the penny stocks) in cases of departmental fault.

Conclusion There is no doubt that the introduction of the POAS has brought somefundamental political and administrative changes to the HKSAR which deservethe careful scrutiny of students of politics and public administration in general,and students of Hong Kong government and politics in particular. It is argued inthis critical evaluation, that the POAS as introduced by the Tung administrationis found wanting conceptually, constitutionally, and institutionally. While it issafe to say that the POAS may have brought a more coherent team of ministersto the Chief Executive, it is far from certain that in its present form, it will increasethe democratic accountability of the HKSAR government or ensure the politicalneutrality of its civil service.

I would like to express my gratitude to Anthony Cheung Bing-leung, Alex Chan Wo-shun,

and Rikkie Yeung Au Lai-kit for their intellectual exchanges on this topic.

Documents

Cheung Chor Yung Quest for Good Governance Principal Officials Accountability System