Constitutional Reform in Hong Kong

Speech of the Hon K P Chan, JP at the Legislative Council on 9 June 2010 Motion Debate On Constitutional Reform

MR PRESIDENT: At a recent media briefing in Beijing on constitutional reform in Hong Kong, Mr Qiao Xiaoyang, Deputy Secretary-General of National People’s Congress, responded that the future of Functional Constituencies should be considered objectively given its existence since elected seats were introduced in the local Legislature.

I fully support views of the Deputy Secretary-General. I find that many critics of Functional Constituencies (FC) in the latest rounds of debates on constitutional reform have been unfair. They have put the blame on FC for almost every conflict in society. In my view, the community seems to have grossly misunderstood FC and even understated their values and contributions. Therefore, it is crucial to portray a full picture to the public at times when people are bombarded with radical slogans instead of realities.

When talking about constitutional reform, we should not ignore realities. In Hong Kong, the realities are maturing economy and stagnating competitiveness. Externally, Hong Kong is facing challenges of Singapore, Shanghai and Beijing. Internally, we are losing clerical and low-skill jobs to our vicinities. On the other hand, low-skill workers are increasing owing to population policies and other factors. The gross imbalance in supply of low-skill labour is depressing wages of the low-income group leading to widening rich/poor gap.

These problems would seriously affect future development of Hong Kong if they are not resolve timely. In fact, the crux of problem is stagnating economy. Yet, there is a different school of thought that they are political issues and FC are to be blamed.

Most people would not oppose to democracy. However, Hong Kong is facing problems that could not be resolved simply by abolishing Functional Constituencies. The real situation is not as described by some politicians. We all know that many countries having universal suffrage are troubled by economic and political problems. In some, premiership is changing frequently. In others, people are holding large rallies from time to time. Their economies are sluggish and people are suffering. In the US and Europe, unemployment rates are close to 10 per cent – a level inconceivable to the people of Hong Kong. Hence, those who are advocating the abolition of FC should be fair. They should tell the people unequivocally that its abolition would not resolve problems that we are facing.

In the contrary, untimely abolition of FC at this juncture would adversely affect Hong Kong instead. Owing to the inherent profile of local politics, directly-elected Members of our Legislature do not necessarily have broad perspectives. Many of them do not have experiences in dealing with economic affairs. Not many have field experiences in doing business or managing enterprises. They do not necessarily understand how the economy works. Comparing with counterparts in other countries, our political parties are not strong in economic research.

They are not necessarily capable of supporting directly-elected Legislators with substantial analyses for economic decisions. Therefore, if Functional Constituencies were untimely abolished, those who are familiar with economic and professional matters would be unable to continue their service. In turn, this Council would suffer from losing invaluable experiences in dealing with professional, economic and financial affairs. We would be even more disadvantageous at times of economic impasse because they are among those who actively participate in professional, economic and financial affairs of this Council nowadays and contribute positively.

Actually, most Members representing Functional Constituencies are working as hard as their colleagues representing Geographical Constituencies. They are equally caring about welfare of the community and the people. They are also bringing voices of their sectors into this Council in the same way as their directly-elected colleagues do for their districts. If any Member representing FC puts his own sectoral interest above public interest, he would not receive peer support. The Hon Lee Cheuk-yan says a moment ago that I voted against the establishment of a central employee compensation fund to replace commercial insurance out of sectoral interest. Probably, my learned colleague missed my remarks at the debate, and he has my sympathy. At the debate, I explained at length disadvantages of the proposed central compensation fund, drawing strong evidence from empirical studies. It is based on these rationale that I could not support the Motion.

Most members of this Council representing FC are endeavoured to serve the community. Many of us are giving up decent pay or decent jobs, or even precious time to serve in the Legislature. Businessmen, executives and professionals joining this Council through Functional Constituencies are paying rather high opportunity costs in reality.
On the other hand, many people are criticizing Functional Constituencies as elections of small circles. Admittedly, they are much smaller in electorate than Geographical Constituencies. Yet, we must be aware that their voters are carrying considerable sectoral responsibilities. Take the insurance industry as a case in point.

Although the electorate comprises only a hundred odd insurance companies, they earned gross premium of more than HK$188 billion in 2008 in total, accounting for 11.3 percent of GDP. Therefore, it is fully justified for the insurance industry to be represented in the Legislative Council. That said, I agree that the current electoral arrangement has room for improvement. The electorate should be enlarged to satisfy principles of equity and popularity. I shall leave it to the Government to follow up.

Mr President, with these observations, I conclude my remarks.

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