Appointment system breeds collusion
SCMP Saturday June 7 2008
Prepare for worse ahead with the new junior ministerial positions.
Far from being a constitutional advance, this is an extension of the
colonial system of appointment of people willing to back the government
in return for influence, prestige or commercial advantage. Instead
of entrepreneurial businessmen, grass-roots organisers or independent
professionals, here is a crop of individuals who appear to have been
picked as facilitators rather than for their administrative skills,
drive or originality.
To call them politicians is wrong. Only a few have been actively involved
in politics. Successful politicians in open societies must appeal to
electorates. In closed systems like China, competition within the ruling
party is fierce. But the Hong Kong politics as envisaged by Chief Executive
Donald Tsang Yam-kuen is neither. It is a throwback to the days when
Hong Kong was supposedly apolitical and the colonial government co-opted
enough of the elite to present an appearance of local representation.
The appointment system may have had some purpose when British officials
needed the support of local dignitaries. But it should have scant role
in today's Hong Kong. Yet the unofficial members of the Executive Council
continue to be simultaneously policymakers, representatives of commercial
groups and appointees to supposedly private entities which are, in
fact, government-controlled. Conflicts of interest are inherent.
The rumpus at Hong Kong Exchanges and Clearing with the resignation
of David Webb has drawn new attention to the incestuous links between
government and quasi-business figures. It is a pity that Mr Webb, apparently
out of frustration, resigned from a job to which he had been elected.
HKEx chairman Ronald Arculli and non-executive directors Laura Cha
Shih May-lung and Marvin Cheung Kin-tung are all Exco members appointed
to the exchanges board by the government. Whether or not the Executive
Council had knowledge of the purchase of HKEx shares by the Exchange
Fund, a series of potential or actual conflicts of interest exists
when individuals wear so many hats.
Mr Arculli is well liked, but his rise had more to do with his ability
to advance sectoral interests rather than the public interest. There
are few major policy decisions which do not affect the property and
finance sectors. He came to prominence as the Legislative Council representative,
from 1988 to 2000, of the richest and most powerful sectoral lobby
group in Hong Kong - real estate and construction.
From Legco, he went to the chairmanship of one monopoly, the Hong
Kong Jockey Club, and then in 2006 to another, HKEx, by which time
he was also on Exco. His connections with the property sector remain
very close, being on the boards of HKR International (along with Mrs
Cha), Hang Lung Properties, two Cheung-Kong-related companies and the
The government may have had a case for controlling the HKEx in the
aftermath of the 1987 collapse. But, after listing in 2000, it should
have been divorced from government control. Instead, the government
moved in the opposite direction, buying shares which enable it to further
increase the dominance on the board of its appointed trustees. This
is one of several advances made by the bureaucracy and its attendant
minions into the realm of commerce.
Mr Arculli, together with fellow Exco member Anthony Cheung Bing-leung,
is also on the board of one of the other government-controlled corporations
- the Hong Kong Mortgage Corporation - an example of the Monetary Authority's
empire-building in an economy that is supposed to be a shining example
of private-sector financial expertise. The corporation was created
to provide extra credit to help bolster apartment and land prices.
Collusion does not need an agenda or meeting place. It just needs an
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