Thwarting the Hong Kong spirit

SCMP August 7, 2006

Barely a day goes by without further evidence, big and small, that Hong Kong's natural verve - that of individual talent and business entrepreneurship - is being suffocated by an increasingly arrogant, politicised and institutionally corrupt bureaucracy.

I use those latter words advisedly. The corruption may not be of the individual form that might be investigated by the Independent Commission Against Corruption. Rather, it is the mutual backscratching that goes on between the senior bureaucrats and a few business interests - notably those with inherited wealth. It is against competition, against proper and independent regulation of the stock market, against serious efforts to either tackle pollution or put the public interest before private profit.

First, take Donald Tsang Yam-kuen's plan to create a new political class of deputy ministers. Worse than creating another bunch of overpaid shoeshiners for the chief executive, the concept further blurs the line between the civil service, politics and business.

It is, in effect, an attempt to build a government party that - if not like the Communist Party - is at least like the People's Action Party in Singapore. That means an elite group whose members glide between ministerial jobs, senior civil-service positions and leadership of quasi-private industries.

In this kind of set-up, power is no longer just its own reward: it's also the path to riches. Mr Tsang's scheme is a deliberate attempt to bolster a narrow power elite to ward off not just democracy, but also the defence of public interests at large. It is not clear how much of his model comes from Singapore, or Beijing, or the Catholic Church, or Franco's Spain - but it contains bits of all of them.

As for lesser illustrations, here are a few from recent days. This newspaper revealed last week that the Competition Policy Advisory Group (Compag) declared that a complaint of price-fixing in freight forwarding was 'not substantiated' - even though the body which claims to represent 90 per cent of air-freight handling actually publishes a fixed-price list. Compag is headed by the financial secretary, includes a bevy of senior officials and is administered by the bureaucracy. It cannot be taken seriously except as a dishonest attempt to pretend to promote competition while shielding cartels.

As this and earlier rulings show, Compag is a classic case of collusion - between government and a business group - to keep prices and profits high at the expense of smaller businesses and the economy at large.

Another case is the placement of Gracie Foo Siu-wai, a civil servant with no actual broadcasting experience, as the No 2 at RTHK. Coming from the Telecommunications Authority, she may know something about regulating broadcasters, but this was a direct slap in the face for Director of Broadcasting Chu Pui-hing. Be sure that this bureaucratic lifer is there for one reason only - to limit the freedom of the airwaves.

Then there's Mr Tsang's demand that the public take the lead in fighting pollution - while his supposedly executive-led government endlessly delays decisions on cleaning up power stations and diesel engine emissions, and pushes ahead with exhaust-generating central road schemes.

Finally, we saw further financial scandals that underline the inability of the government-controlled monopoly Hong Kong Exchanges & Clearing to regulate itself. This was the collapse of Ocean Grand Holdings, which left more than 800 million yuan in clients' funds missing. We saw the rapid exodus of high-profile figures from the Ocean Grand board, following their apparent failure to carry out their fiduciary duties towards the shareholders.

HKEx is clearly run to protect vested interests from both free competition and the rigorous enforcement of rules.

Democracy is no panacea, but without a stronger and more representative Legislative Council, this drift towards bureaucratic authoritarianism will continue.

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